Following growing interest across the co-op grocery world, Valley Natural Foods in Burnsville, Minn., recently completed installation of four self-checkout lanes in its store. The self-checkout units are the latest available from LOC SMS and have been up and running for several weeks. Nick Seeberger, Valley Natural Food’s CEO, reported that customer acceptance of self-checkout has been positive and noted that the lanes were a bonus during a recent period when the co-op was acutely short on front-end staff.
According to Seeberger, the co-op made the decision to install self-checkout, or SCO, during the co-op’s annual strategic planning process. “At Valley Natural Foods (VNF), we have a rolling five-year vision of where we want the co-op to be, and each year we create a highly tactical strategic plan to propel us toward our five-year vision,” Seeberger said.
Seeberger was also aware of the fact that the Merc Co+op in Kansas had successfully implemented self-checkout and that VNF had a peer that could share important lessons learned as they worked on the implementation process. Once they decided to move forward, VNF gave SCO the greatest urgency and importance due to the potential it offered in saving labor dollars.
“If we wanted to pay our staff more and avoid attrition or layoffs from a sales impact, we needed it in place ASAP,” Seeberger said. “We see our deli/juice bar as a huge competitive advantage, and as we focus on growing our offerings and sales in this area, having a quick check-out option for those customers will help the speed of service and ideally make us a frequent stop for those lunchtime and dinner customers.”
Running a simple return-on-investment exercise, the co-op made assumptions about how many hours per day they could reduce their cashiering schedule. Given the impending sales hit from competitors, Seeberger and his staff realized the budgeted income statement for the year looked a lot better because of the reduction in labor they would start realizing within two months of opening the lanes. Now, about a month and a half past fully launching SCO, the results are even better than anticipated. The total cost came in at roughly $58,000 — significantly under budget — and VNF is already seeing over 30% of transactions going through SCO, which allows them to operate much lighter front-end labor schedules.
Heading into the project, the co-op addressed the concerns of both staff and customers, which made the transition relatively smooth. They held meetings with staff to discuss changes and provided them with talking points for when the news about SCO became public. The front-end team was given an entire month of set-up time with the lanes before launching, which Seeberger said actually built customer curiosity and excitement as they could see the work progress. Dedicated staff now actively invite customers over and help them use the lanes, so they can get comfortable using SCO.
“For those individuals who cherish the human connection at the end of their shopping experience, it is still a part of their experience. For those who prefer speed of service or avoiding contact, we have the SCO,” said Seeberger. “We have raised our staff wages while reducing our overall labor costs, and we are well prepared not only to weather the impact from coming competition, but also to focus on being a top-notch grocer.”
