Target reserves self-checkout lanes for customers with 10 items or fewer

Love them or hate them, self-checkout lanes are being limited by some retailers, including Target, and in some cases are being pulled out altogether.

After a pilot in 200 stores last fall, Minneapolis-based Target said this week all stores will start restricting use of self-checkout lanes to customers buying 10 items or fewer. The new rules go into effect Sunday at most of its 2,000 stores nationwide.

In a statement, Target noted that self-service lanes rose in popularity during the pandemic as a contactless option, but said it is making the change now in the name of speed and a better overall customer experience.

“Self-checkout was twice as fast at our pilot stores,” the company said, adding that customers also indicated in surveys their overall checkout experience was better in stores where it was tested.

But retail analysts suspect a different motivation is at play: reducing theft and product losses when customers forget to or incorrectly scan items.

Rising retail theft and product losses, referred to as “shrink” in industry speak, has been a recent challenge for many retailers.

“There’s a lot of shrink that happens at self-checkouts both deliberately and accidentally and I think Target is very keen to reduce that,” said Neil Saunders, managing director of GlobalData. “Nudging people back to manned checkouts where it’s more of a controlled experience and these mistakes don’t happen is a way of trying to reduce that shrink.”

A Target spokesman said while theft was not the primary reason the retailer is making the changes to self-checkout lanes, he acknowledged the company did see a reduction in shrink in the stores where the restrictions were tested.

At an investors’ meeting last week, Michael Fiddelke, Target’s chief financial officer, told analysts that the retailer’s shrink costs increased more than $500 million last year, putting more pressure on its profit margins.

“Happily, we’ve seen some encouraging trends recently resulting from both the actions we’ve taken and the community efforts we’re seeing across the country,” he added.

On Thursday, executives at Dollar General said they will remove self-checkouts from more than 300 of its highest shrink stores. In stores that will continue to have them, they will limit transactions in those lanes to five items or less and convert many of them to assisted-checkout options.

Executives They said they think the moves will help combat theft as well as people not properly scanning items.

As for Walmart, some shoppers have recently noted on social media that its self-checkout lanes have sometimes been closed. In a statement, the company said it has always let stores adjust when they use self-checkouts.

“For example, a store might start or end the day with staffed checkouts,” Walmart said. “As the number of shoppers and associate staffing increases, these stores open self-checkout registers to manage the increased customer flow. This process isn’t new.”

But what is new is that during times of limited access to self-checkout lanes, Walmart is now designating some of them as being open only for those in its membership program Walmart+, who are using its scan and go service or for operators of its delivery services.

“This decision is intended to better manage checkout availability,” Walmart said.

In announcing its changes this week, Target said it will open more traditional checkout lanes with cashiers to accommodate shoppers.It added that while hours for the self-checkout lanes vary by store, they will be open during the store’s busiest hours.

Saunders said he hopes Target does open more checkout lanes to accompany the new limitations because he visited some stores over the holidays where restrictions were being tested and it was “a big mess.” It pushed more people to the manned checkout lanes, but there weren’t enough such lanes open to compensate.

He added that he thinks the limitation on self-checkout will annoy customers in other ways, too, and will be difficult to enforce.

“Some customers will just ignore it,” he said.. “Customers will say, ‘Well, why is it 10?’ It’s a very arbitrary limit.”

And it will be hard to enforce, he said.

Saunders acknowledged that self-checkouts aren’t popular with everyone. Some people prefer them while others find them to be a big hassle.

“Self-checkout is one of those technologies that still divides people,” he said. “But it is a type of checkout that a lot of people will use regularly, especially if they aren’t buying very much or they want to get in and out pretty quick.”