In October 2021, we looked at the introduction of check-out free (COF) stores in the UK and Europe – read here. Six months on, let’s review how the technology is landing.
What is the point of check out free stores?
In short, they eliminate queuing. As designers our briefs often address this pain point explicitly, recognising that queuing is a problem that needs to be solved. On the face of it, therefore, check-out free stores make sense.
There is, however, currently a huge cost associated with installing the cameras and sensors that run COF stores. Given how tight margins are in grocery, does it have mass rollout potential?
And do shoppers really want it, given the ‘side effects? Check-out free reduces friction insofar as you don’t have to pause to pay, but what are the implications for controlling spend in a scenario where a receipt might not arrive for an hour or longer after purchase? Once customers get accustomed to COF, will they then start asking why they can’t see a running total of their spend while they shop?
What other problems can check out free solve?
The most obvious one is geographical reach. COF can put unmanned stores in remote locations where staffing costs would otherwise be a barrier. Swedish chain; Lifvs launched in 2018 and is the largest unmanned grocery chain in Europe. Its 20 containers are open 24 hours, allowing for different working and shopping patterns. Entry is via a phone app that is also used to scan products. The process is less seamless than simply putting items straight into a bag. The app keeps a running total and there is no wait for a receipt, therefore meeting a genuine customer need. There is no equivalent or better solution that works economically and operationally for a retailer and is convenient for the rural customer.
The unmanned container solution isn’t just for remote locations or small communities though. Albert Heijn’s new convenience store concept at Amsterdam’s Schipol airport encourages shoppers to scan their bank card. They can pick from 70 SKUs and leave, the store is designed to feel akin to taking something from your own fridge. University campuses, temporary sites at festivals or locations where the main store is being refurbished – something the Co-op is trialling in the UK – are other notable examples.
What about beyond grocery?
There is a natural division between functional, necessity and optional, discretionary purchases where service and advice play a key role. This is relevant in luxury but also for brands like Lush, where knowledge and expertise are part of the core pillars of the proposition.
Travel retail, with its limited assortment and time-pressured customer, is an obvious growth area, including motorway service stations. There are varied challenges in apparel. Customers shop clothing stores very differently, picking items up to inspect them and often putting them back elsewhere. As such a certain level of staffing will always be required to manage the shopfloor, maintain standards, and at times can be at the cash tills. In addition, we’d question how capable the technology would be of detecting minute differences between similar styles, sizes and patterns. This could make inventory management and accurate charging very difficult to achieve.
COF has already evolved hugely since Amazon Go first launched in 2021. We’ll be issuing our next status report in due course.
We’ve packed a lot of thoughts into this quick read. To learn more, get in touch to book in a 30-minute chat with Sarah and Dan:
Watch CADA’s Lunch & Learn where we explore the topic of Check-out free stores!
