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Analysts says Albertsons is quotlooking for the right valuationquot before going public Photo by Ethan MillerGetty Images News
<p>Analysts says Albertsons is &quot;looking for the right valuation&quot; before going public. (Photo by Ethan Miller/Getty Images News)</p>

Albertsons pleased as it bucks self-checkout trend

Operations exec sites simplicity, service benefits

The trend-bucking practice of removing self-service checkouts is continuing at Albertsons Cos. as the company renovates and integrates stores acquired in recent years.

In an interview with SN  last week, Susan Morris, EVP of operations for Albertsons’ East Region, said that although some stores are keeping self-checkout, the Boise, Idaho-based retailer has pulled the units from “most” locations including most recently the dozens of former A&P-owned units absorbed by its Acme division in the Northeast, and at numerous Safeway stores on both coasts acquired as part of its merger with that company.

“We prefer face-to-face interactions with our customers,” said Morris.

In many cases, Morris added, the removal of self-checkouts is accompanied by an increase in the number of express lanes to accommodate customers seeking rapid checkout and the repositioning of customer service desks to a central position on the front end. Albertsons has also been experimenting with a single queue in some stores with a goal of serving customers faster, Morris said, and expanding its “Three’s A Crowd” program designed to open a new register when more than three shoppers are waiting on a line.

These changes in some ways mirror Albertsons’ discontinuation of card-based loyalty programs over recent years as it pursues a more simplified operations structure that reduces costs and, officials say, better serves its shoppers.

By contrast, competitors like Kroger in recent years have made substantial investments in self-service and customer loyalty, citing them as opportunities for greater efficiency.

Introduced nearly 25 years ago, self-checkout has grown exponentially due to high consumer acceptance and the potential for retailers to use it to improve customer experience, according to a report published by NCR in 2014. That report cited a survey conducted by NPD on behalf of the transaction technology company that indicated 90% of shoppers globally identify themselves as users of self-checkout, and that 7% of all shoppers always use the option when available.

The NCR report also cites Food Marketing Institute’s 2014 Grocery Market Trends report that said 40% of U.S. shoppers agreed that self-checkout was “somewhat important” or “very important” when selecting a primary grocery store.

Morris of Albertsons is aware of these reported trends but noted the complexity in running self-checkout can often overshadow its perceived benefits for the company and its shoppers. She cited among other things equipment that is not compatible with changing payment technologies like cards with EMV chips; consumer frustration with entering codes for items sold by weight; shrink issues triggered by improperly coded items; and issues bagging groceries. Also, she noted, trained checkers typically provide faster service than a shopper checking themselves out. “We measure these things,” she said. “It can be a matter of seconds, but they all add up.”

Further, Morris said, face-to-face interactions between shoppers and staff allow the company to maintain a sales-focused culture. “It gives us a chance to thank them for coming in, and keep them aware of our programs like [electronic loyalty programs] MyMixx and Just For U. In most cases, we are adding worker hours to do this.”

Morris said the effort has led to higher customer satisfaction scores as indicated by surveyed shoppers, “and we know there’s a direct correlation between high customer satisfaction and ID sales. Our strongest ID sales are coming from stores with the strongest customer satisfaction scores.”

Some — but not all — social media mentions of the switch suggest customer consternation with the move:


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