Reinventing The Checkout

New mobile shopping apps, self-checkout options and a scanning tunnel are just some of the options taking POS to the next level in grocery stores.

In a grocery store, one of the main areas where a customer comes in contact with technology is at checkout. Whether it's a typical point-of-sale (POS) system, a self-checkout or inter-acting with a mobile phone for coupons and payments, the checkout process can leave a lasting impression on a customer — either good or bad.

Today's shoppers like options, and they also like to pay and exit the store as quickly as possible once they've finished shopping. As technology evolves, savvy retailers will meet these needs and offer a variety of options at POS, according to Bill Bishop, chairman of Barrington, Ill.-based Willard Bishop and chief architect of Brick Meets Click.

"What I anticipate from grocery is having more of a variety of checkout options than there are now," says Bishop. "There could be three or four different checkout experiences available. I'm also expecting to have more mobile checkouts. The real growth is when customers can use their smart-phones, and this will grow quickly."

Bishop also believes tablet systems like Revel Systems' POS iPad technology could offer secondary checkout options at departments such as deli, a coffee shop, bakery and other areas where customers can opt to grab and go without having to pay at the front of the store. Revel recently announced integration to a number of reward and enterprise resource planning (ERP) companies, as well as QuickBooks, and can also connect to a flatbed scanner in a grocery store, according to Lisa Falzone, CEO of San Francisco-based Revel.

Another area of growth, although not affecting the customer directly, is moving to cloud-based options. Terry Brett, owner of Kimberton Whole Foods, a Kimberton, Pa.-based independent natural and organic food retailer with four locations, recently elected to have his POS company, ECR Software Corp. (ECRS) in Boone, N.C., back up all of the company's data onto the cloud.

Some industries are embracing cloud-based POS, including many quick-serve restaurants (QSRs), but Bishop says that while a few grocers are migrating several areas of operation to the cloud, many still have concerns about security and reliability when it comes to POS.

"I think there are still lingering concerns, and vendors need to make sure they cut the tail on security, and make sure the POS can run even with an interruption," he explains.

Self-checkout is also evolving with the advent of mobile apps and the ability for customers to scan items with smartphones. The latest consumer research shows that stores with self-checkouts are actually thought of as limited by customers, according to Bishop.

"I'm not sure customers are convinced they are well applied," says Patrick Fitzpatrick, president and CEO of Atlanta Retail Consulting Inc. in Alpharetta, Ga. "They are supposed to replace express lanes, but they are further from the door, and they also take longer."

However, in many instances it comes down to perception. Some customers perceive self-checkout as faster because they're more involved with the process rather than waiting for a clerk to scan and bag items, notes Joe Jurich, president and CEO of Retailer Owned Research Co. (RORC) of Arlington, Texas.

One of the newest self-checkout options available from both NCR Corp. and QThru puts the power into the hands of customers using an app to scan products as they shop. Once done, users can also pay with their mobile devices at self-checkout kiosks.

"I don't think there is a more powerful way to build customer engagement," says Bishop, explaining that grocers and brand partners can offer digital coupons for items as they're scanned by the phone, or offer special promotions that drive larger baskets. "Portable self-checkout is changing the front end of the store."

Going Mobile

Whether customers scan products, pay for transactions or apply coupons using smartphones, mobile is changing the grocery checkout process. Robesonia, Pa.-based Associated Wholesalers Inc. (AWI) is working with independent grocers to create mobile apps as robust as those used by larger chains, including those with recipe options and virtual shopping lists, and RORC, owned by three cooperative wholesalers, including AWI, is exploring the creation of a line-buster app. This would allow employees to pre-scan a customer's items while he or she is waiting in line to check out — ideal for use around the holidays, according to Jurich, who says the company also rewrote its POS system to accept e-coupons.

"We are working to get the POS more open so it's easier to plug into third-party components, such as Google wallet, e-coupons, electronic receipts, and loyalty programs that don't require cards," he explains.

Duluth, Ga.-based NCR recently launched a mobile shopper app with Woodman's Food Markets in Madison, Wis., allowing customers to use their iPhones to scan items as they shop.

Shoppers can use the app to create virtual shopping lists before going to the store, to increase the speed, efficiency and ease of their shopping trips. NCR designs and implements the technology to reflect the brand of the store using it.

To check out, shoppers go to Woodman's self-checkout stations and scan a QR code on their phones to transfer their mobile shopping information to the self-checkout station, which confirms the weight of the items scanned with the phone against the items being bagged at the station. Attendants can help customers reconcile any discrepancies the system identifies and answer any other questions they may have. Produce, other non-bar-coded items and impulse items can also be added at the self-checkout.

Another mobile shopping solution, from Seattle-based QThru, can be used on an iPhone or Android mobile device. Using a small kiosk, customers also scan a QR code to pay with a credit card stored in the app. They can then print a receipt, bag their items and leave the store.

"We need to know prices and advertised specials in the store, and we integrate at the POS level or ERP level," says Aaron Roberts, founder and CEO of QThru. Customers download the app — which can be store-specific — and enter their credit card info by holding it in front of the phone. The app also stores securely in a PCI-compliant database, according to Roberts.

The solution, which additionally has the ability to integrate a loyalty card, is in place at two Seattle-area IGA stores owned by Myers Group, and the stores' owner, Tyler Myers, worked with QThru to help the vendor enhance its solution to meet the needs of a grocery store, such as dealing with weighted items like produce or age-restricted products.

"Now, if an age-restricted item is scanned, the app won't allow them to check out and pay until a clerk comes over to check the ID," Myers explains. "Then the clerk scans a card with a UPC code on it so the system releases the transaction. As far as weighted items, if you were buying three apples, you just weigh the items on a digital scale and scan a QR code with the phone to add it to the order. There is no need to print a label."

QThru came into Myers' stores and offered customers $5 off a $50 grocery bill for trying the solution, and Myers saw the number of users go up dramatically. "The feedback from customers has been great," he notes. "We also saw the average sale per customer increase with the use of the technology, and more items are added to the cart."

The app also offers a recipe section from which customers can add items directly to a shopping list, and the feature Myers is looking forward to using is the home checkout piece. This allows customers to create a list from home, send it to the store, and then just drive up to collect the bags and pay.

Since one of his biggest concerns in the beginning was theft, Myers has an employee check the basket with the receipt before customers leave the store. "I look at it as an alternative checkout for people who want to get in and out quickly," he says. "Customers can also scan items in their kitchen to create a list, and download recipes to add those items to their list."

A Faster Checkout

Most consumers agree that the hardest — and certainly least fun — part of grocery shopping is waiting in line to check out. While some believe self-checkout is faster, others would rather have someone else doing it for them, but perception plays a role in both.

"Customers always appreciate getting through a line more quickly, so anything that can scan items faster is something grocers would find beneficial," says Brett at Kimberton Whole Foods. His POS vendor, ECRS, is getting ready to test its newest checkout option, RAPTOR (Retail Application Prototype Testing of Operational Robotics) this summer. The solution scans items as customers place them on the belt; the attendants' only job is to bag the items and collect payment.

The system uses ECRS software, Catapult Transaction Server, along with Datalogic's Portal Scanner, which integrates with the POS system. It's also designed for larger purchases, says Pete Catoe, president and CEO of ECRS.

"The software is carrying more of the workload for the attendant, and it speeds up the whole process," he notes. "The consumer gets a faster checkout time and gets all their items bagged by the time they are done placing them on the belt."

The advantage of this technology is that it offers the best of both worlds, according to Bishop, who saw it in action at the most recent National Retail Federation Annual Convention and Expo in New York. "It allows you to be self-service and a service checkout at the same time, and part of the execution is to be able to reconcile the UPC readings form all angles," he observes. "This is a big idea."

The Datalogics technology uses approximately 14 cameras to track the items as they go through the tunnel, and ECRS' software integrates with it to make the transaction seamless. (To see a video of the RAPTOR system in action, visit the videos section of www.independentgrocernetwork.com.)

"There could be three or four different checkout experiences available. The real growth is when customers can use their smartphones, and this will grow quickly."

—Bill Bishop, Brick Meets Click