Case Study: Storefront Checkout Flow Analysis
The Kroger Company, a large grocery store chain in the US and the country’s second largest grocery retailer by volume, required a simulation tool to address its store check out configurations.
The Key Retailing team at Kroger is charged with the responsibility of investigating process improvement methods for efficiently handling customer check-outs at the front of its stores. This includes analysis and streamlining of check-out processes, investigation of new technologies such as self-checkout or u-scan robots, queue management, tools for staff planning, etc.
There is a great deal of data available at the store level, which can be used to identify customer service levels and cashier utilization. The team had a number of static spreadsheet models to assist them in this analysis, but these models did not allow for the analysis of a new check-out lane configuration or the effect of increased customer traffic under specified staffing plans.
Moreover the team required a single Checkout Flow Analysis tool that could be standardized at all locations as each storefront has a unique layout.
The Visual8 team created a Checkout Flow Analysis simulation tool with drag-and-drop objects that would allow the team to configure the different types of cash-out lanes at the front of the store with easy-to-adjust customer demand profiles by time of day and day of the week. This helped the team analyze current and alternative storefront layouts with respect to staffing, technology, and customer demand.
The component-based simulation tool was created with drag-and-drop objects including regular and express check-out lanes as well as U-scan robots. Users could specify the number of cashiers, baggers, and customer assistants by time of day and create different customer profiles by day and week. Additional inputs included processing times at both regular and express check-out lanes. These were based on standards preset by the Key Retailing team, which are drawn from Kroger standards.
Customer selection of a check-out lane will be based on factors such as proximity, queue lengths, the number of items in the shopper’s cart or basket and the shopper’s interest in using the self-serve or U-scan robots. Lane-swapping will also be simulated and customer check-out times will be a function of the cashier’s experience, number of items in the cart, number of price checks or interventions, customer type, etc.
Detailed analysis allowed the Key Retailing team to identify possible process improvements at customer check-out and to make recommendations on the design and layout of new or re-modeled storefront operations.
Of particular interest was the 1+2 criteria, which is the condition that there should be at most 2 people waiting to be served at a lane (in addition to the one currently being served). If there are >2 people in the queue then the criteria has been breached.
The proposed system provided Kroger with a purpose-built storefront simulator to analyze the impact of different check-out configurations with changing staffing and customer demand profiles. The tool also helped the Key Retailing team to identify process improvements at customer check-out and to make recommendations on the design and layout of new or re-modeled storefront operations.
In addition, the simulator also helped the Key Retailing team to validate the results from the Enterprise Labour Management System (ELMS) and explore new standards for customer check-out based on process changes and the introduction of advanced technologies.