How ending self-checkouts boosted Dollar General's sales

Daily Mail​

a day ago

It may be the end of self-checkouts as we know it after Dollar General's tech gamble paid off. The retailer removed self-checkouts from 12,000 stores nationwide in 2024 - leaving them in only a handful of locations. The company said at the time that it made the move in order to cut rising 'shrink', the retail term for theft.
The value store had seen shoplifting soar since installing the tech. Now it seems removing the machines is helping stop theft. The company reported that lower shrink and higher inventory markup were major factors in boosting its income by 8 percent to $392 million in the first quarter of this year, Retail Dive reported. Chief Financial Officer Kelly Dilts said improvement in shrink rates will be a tailwind throughout the year and that 'should be the gift that just keeps on giving.'
'The removal of self-checkout is sensible at Dollar General. The stores are pretty small and don't really need self-checkout,' Neil Saunders, retail expert at GlobalDatatold DailyMail.com. Other chains may follow in its footsteps, he added, but he does not think it is likely they will disappear entirely from all stores.
'I think some chains will remove self checkout, but we won't see the concept disappear entirely. It still has advantages,' Saunders said. Retailers like Walmart , Costco, and Target have already begun removing self-checkout, mainly to curb theft and revamp stores.
In the first quarter of this year Dollar General has opened 156 stores and remodeled 688 locations as part of its Project Elevate, and revamped 599 through so-called Project Renovate.
The company continues to operate over 20,000 stores in the US and Mexico, and it finished off this year's first quarter with $10.4 billion in net sales, a 5.3 percent increase from this time last year. 'As we think about gross margin, we are just really pleased with where shrink came in,' chief financial officer Dilts said.
CEO Todd J Vasos also praised improvements in layout and merchandising. 'Our store standards are much, much better than they've been in quite a long time, and every single quarter that goes by continues to get better and better,' he said on Tuesday. Walmart also experienced sales increases in its recent quarters, having removed self-checkouts from all Sam's Club stores in favor of AI technology .
While Target has removed self-checkout in some locations, a spokesperson told the New York Post that it will not be gone for good. Despite the apparent success of the removal of self-checkout machines, it has not been completely smooth sailing for Dollar General in recent months.
Locations were shuttered last year, and Vasos claimed its 49 percent profit drop in last year's fourth quarter was partially due to consumers pulling back on spending .
'Many of our customers report they only have enough money for basic essentials, with some noting that they have had to sacrifice even on the necessities,' Vasos said as the retailer announced October to December earnings. DailyMail.com has reached out to Dollar General for comment.