Dollar General has announced plans to remove self-checkout machines from 300 stores and restrict their use in thousands of others in response to escalating retail theft. The decision, disclosed during the company's recent earnings call, aims to combat "shrink," a retail industry term for losses due to theft, fraud, and damage.
The company, which operates over 14,000 stores, will limit self-checkout transactions to five items or fewer. Additionally, Dollar General will convert many self-checkout registers to assisted-checkout options in approximately 9,000 locations. This shift aims to direct customer traffic to staffed registers, thereby reducing opportunities for theft and improving customer service during peak shopping periods.
Dollar General To Eliminate "Vast Majority" Of Self-Checkout Due To Soaring Theft https://t.co/szst09Kz70
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CEO Todd Vasos explained that these changes are expected to positively impact shrink levels by the latter half of 2024 and into 2025.
The company reported a significant increase in shrink over the past year, with fourth-quarter shrink rising more than 100 basis points compared to the previous year.
Dollar General To Eliminate "Vast Majority" Of Self-Checkout Due To Soaring Theft
"Shrink continues to be the most significant headwind in our business"https://t.co/GfRYRvHz7s
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In an effort to address the issue, Dollar General has invested heavily in labor, with an additional $50 million allocated for 2023, bringing the total investment to $150 million. This increase in staffing is intended to bolster in-store security and enhance customer service, further mitigating theft risks.
Dollar General's move follows similar actions by other major retailers grappling with the surge in retail crime. Retail theft has been a growing problem across the industry, with an estimated $112 billion lost in 2022 due to unprecedented levels of theft.
While the elimination of self-checkout options may inconvenience some shoppers, Dollar General is confident that the enhanced security and customer service will ultimately benefit both the company and its customers.
The retailer's proactive measures reflect a broader industry trend of reassessing self-checkout strategies to better address the challenges posed by retail theft.
