Dollar General is reducing self-checkout stations

Dollar General has announced plans to completely remove the self-checkout stations in 300 locations and has begun converting some or all of the registers in another 9,000 stores.

The reasons are twofold. Customers, on a wide scale, are tired of having to scan and bag their own goods, especially given the numerous errors the machines encounter. Businesses, despite saving on labor costs with self-checkout, see the drawbacks of it, too. Northern England grocery chain Booths ended most of its self-checkout services in November, saying employees bagging groceries “delivers a better customer experience” than self-checkout kiosks.

And the devices have also led to a surge in theft by shoppers, which retailers call “shrink”. (Home Depot, for instance, says over $100,000 worth of goods was stolen in Florida alone via self-checkout machines earlier this year.)

Almost one-third (31%) of Generation Z shoppers have admitted to shoplifting from self-checkout kiosks, according to a November LendingTree survey of 2,000 U.S. consumers. (Just 15% of shoppers overall admitted to the habit.) Almost half of Gen Z participants (46%) said they plan to steal the most expensive item in their cart, while 37% said they will forgo paying for basic items, like food and water.

Dollar General says of the stores that keep self-checkout registers available, they’ll begin limiting transactions at those to five items or less.

“We believe these steps are in line with where the customer wants us to be, which includes increasing personal engagement with them at the store,” said CEO Todd Vasos on an earnings call Thursday. “Additionally, we believe these actions have the potential to have a material and positive impact on shrink as we move into the back half of the year and into 2025.”

In 2021, self-checkout usage represented 30% of transactions, almost double from 2018, according to a survey of retailers by FMI, an industry group. But as theft increases and customer complaints rise, retailers are removing them from stores.

Walmart took the kiosks out of three New Mexico locations last fall. Target announced that starting March 17, it will transition to “express self-checkout” in most of its 2,000 U.S. stories, limiting the number of items a shopper can self-scan to 10.  Target locations piloting the new system reported self-checkout was “twice as fast” as before, according to the retailer.