The supermarket chain that said no to self-serve checkouts

YOU won’t hear “unidentified item in the bagging area” here. This Adelaide supermarket has more staff and people are abandoning the big two to shop with them, bosses claim.

A sign from the Adelaide's Finest Supermarkets Foodland store chain which has said no to self-serve.

“I’VE not heard a negative whisper from any customer,” says Paul Mabarek, manager of customer engagement at the Adelaide’s Finest Supermarket chain.

“I see all of the customer complaints and I cannot recall a single customer saying please put in self-serve checkouts. Not a single one.”

The South Australian retailer has banned self-serve checkouts. In fact it says it would be a “disaster” for it’s business if it installed them.

Mr Mabarek claims the electronic contraptions are behind a drop in customer service levels at Coles and Woolworths which has been a major “misstep” for the big two.

He even suggested the retail giants would be wise to turn their back on self-serve altogether.

The checkouts are back in the news again following Coles’ decision to crackdown on slow coach customers clogging up the store scanning trolleys full of groceries.

Adelaide's Finest Supermarkets Foodland at Frewville.

The supermarket will trial a new 12-items-or-fewer rule at the checkouts in some stores. The supermarket said self-serve continues to be popular with basket shoppers who can checkout quicker.

And then there’s all that theft — the “swipe everything as carrots” mentality.

In early October, Coles called on NSW police to help them target self-serve checkout theft, and reduce its annual overall theft debt which some retail industry experts estimate at $1.1 billion.

On Tuesday, it was revealed a Queensland mum had taken self-serve theft to a whole new level with an elaborate barcode scam that enabled her to steal $4500 in groceries from Coles and Woolworths.

But Woolworths has declared self-serve a success, and says in some stores it will more than doubling the size of the self-service area.

“We know that self-serve checkouts are very popular with our customers and we have them in around 80 per cent of our stores, with an average of six in each,” a spokesman for Woolies told news.com.au last week.

That’s not the message Mr Mabarek’s customers have been telling him.

“We’ve asked them and they are unequivocal. They like what we do. We have received nothing but support by having service at the checkouts.”

Adelaide's Finest Supermarkets says it will never go down the self-serve route.

AFS, owned by the Chapley Group, runs a small chain of full-size Foodland IGA co-branded supermarkets in the Adelaide suburbs.

The stores are no minnows, however, being among the highest turnover in the IGA stable and are in a state where the banner retailer has been most successful in taking the retail fight to Coles and Woolies.

Following refurbishments several years ago, bosses at the AFS stores at Frewville and Pasadena vowed never to go down the self-serve route.

Mr Mabarek admits maintaining full size belted checkouts is costly but says the extra customers they have nabbed from the big boys means it’s a cost worth bearing.

He said some AFS stores had double the number of store staff compared to comparably sized competitor supermarkets.

“One of our marks of success is that we employ more staff, not less staff, because there’s a fundamental belief that if you improve your service and are in tune with customer’s expectations they will support you.

“We’re not business naives, we know what the bottom line looks like and our policy is leading us to tremendous growth and our profitability is sound,” Mr Mabarek said.

Coles and Woolworths have consistently denied self-serve was introduced to cut headcount in stores. Excess staff from checkouts have been redeployed to other parts of the supermarket, they say.

The Adelaide chain is known for its quirks — such as instore pianists. Picture Mark Brake

Unlike AFS, some IGA franchisees have also installed self-serve lanes. Conversely, Aldi has shunned self-serve saying its design of register makes them just as efficient.

Marketing consultant Barry Urquhart has previously told news.com.au, his research showed 84 per cent of customers prefer to be served by a human.

“They think, ‘hold on, I’m saving you money, where’s the advantage or benefit in it for me?’” he said. “That’s when they become frustrated.”

However, a 2014 survey by self-serve checkout manufacturer NCR found 90 per cent of shoppers had self-swiped their shopping — particularly those with small baskets.

Nine per cent of shoppers only use self-serve, the research found. But another 10 per cent — mainly older customers — refused to use the machines preferring to be helped by an employee.

A customer uses a self-serve checkout at Coles in Erina. Picture: Mark Scott

Mr Mabarek said prices were competitive at AFS but conceded “people come to the store not because they want the cheapest food but because of other things like store atmosphere.”

Unique initiatives included special “quiet hours” where shoppers can peruse the aisles in peace while on other days a live pianist tinkle the ivories as shoppers choose their veggies.

“We have huge flows of Coles and Woolworths execs scratching their heads trying to work out what they do,” he said.

They’ve been reducing staff but it takes focus away from customers and our view would be once you stop thinking about customers’ needs you get all tangled up and I can see that [Coles and Woolworths] are all tangled up — they don’t know where to go.”

Mr Mabarek said the major retailer’s focus on the bottom line was a “misstep”.

What did he think of Woolies and Coles sticking by, and even investing further in self-serve?

“Good luck to them, but we know where we’re going and they have no impact on us.”

Besides, he added, “We wouldn’t take a lead from the big two. For us that would be a disaster.”

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Originally published as The supermarket chain that said no to self-serve checkouts