(NewsNation) — Dollar General is joining the list of big stores cutting down on self-checkout.
“We relied too much this year on self-checkout in our stores,” Dollar General CEO Todd Vasos said during an earnings call. “We should be using self-checkout as a secondary checkout vehicle, not a primary[…] It’s going to make a world of difference.”
In 2022, Dollar General expanded self-checkout stations to approximately 19,000 stores, Retail Drive reported. They also piloted some self-checkout-only stores. The company hoped it would offer convenience, speed and reduce labor costs.
The store is now rethinking self-checkout after experiencing “shrink,” which is the retail industry’s term for loss of inventory. The retailer announced they’d be investing an extra $50 million into labor by the end of the year bringing their total 2023 investments to $150 million. That means you might soon see more employees at Dollar General.
Why cut back on self-checkout?
Self-checkout was first introduced during the 1980s to lower labor expenses, and the concept expanded to supermarkets in the early 2000s. Stores ultimately were hoping to cut costs, but during the pandemic customers relied more on self-checkout to minimize interactions with employees. Fast-forward to today, and retailers are revising their self-checkout strategies as backlash grows.
A study of retailers in the United States, Britain and other European countries found that companies with self-checkout lanes had a loss rate of about 4% of the total value of the purchases, double industry average.
“It helps on the sales line because we’ve got somebody to meet, greet, and ring up the customer. It also helps on the shrink line because you’ve got somebody at the front end of the store that is always there to monitor the front end of the store,” Vasos added during the call.
Who else is ditching self-checkout?
Walmart got rid of self-checkout lanes at two Albuquerque locations this year. A Delaware ShopRite pulled self-checkout after customer complaints.
Costco announced it would add more staff to the self-checkout areas after non-members were found sneaking in. Five Below has said that “shrink” increased when there were more self-checkout lanes and that they plan to increase the number of people at registers.
Target: In November, Target announced their plan to restrict some of its self-checkout areas to shoppers purchasing 10 items or less. The change will only affect a small number of stores during a test phase, according to a Target representative.
NewsNation has reached out to Dollar General for more information.
NewsNation’s Utah affiliate ABC4 contributed to this report.
