Is Going Cashier Less the New Winning Strategy in Retail?

Shutterstock photo

The grocery war is heating up with tech giants fast trying to invade the space. Reportedly, Microsoft, Inc. MSFT is working on a technology that will eliminate the role of a cashier in a store. And if reports are to be believed, the tech giant is already in talks with retailers, including Walmart, Inc. WMT . Understandably, the technology is being developed in a move to compete with Amazon.com, Inc.'s AMZN Amazon Go, the e-commerce giant's cashier-less store.

That said, an increasing number of retailers and grocers are focusing on customer convenience. From speeding up delivery to introducing digital shopping scanners and coming up with cashier-less stores, retailers are aggressively pumping in more money to develop new technologies and adding muscle to their delivery arm to stay ahead in the race.

Microsoft Challenges Amazon

Microsoft is reportedly developing a technology wherein a cashier would no longer be required in a brick-and-mortar store. The tech giant is working on a system, which will be able to track what a customer puts in his or her cart in a brick-and mortar store. In fact, Microsoft reportedly has already demonstrated the sample to select retailers.

Interestingly, the new technology could revamp the company's previous failed attempt of check-out free shopping. Moreover, Microsoft plans not to introduce this technology in its stores first. Instead, it is reportedly in talks with Walmart. Understandably, the new technology is in a move to challenge Amazon Go, the e-commerce giant's cashier-less store. 

Amazon, over the last few years, has changed the entire retail ballgame that has made brick-and-mortar stores like Walmart, Target Corporation TGT , The Kroger Co KR , Dollar Tree, Inc. DLTR and Dollar General Corporation DG shift focus to online.

However, Microsoft's aim is to develop a cost-effective retail tech system that will not only eliminate the role of a cashier but also will help in cutting down the cost of thousands of cameras installed on the ceilings of brick-and-mortar store.

Others Join the Race

In January 2018, Amazon opened the first Amazon Go store in Seattle. The 1,800-square-foot automated store has replaced cashiers with a smartphone app and hundreds of small cameras that tracks customers' purchases. This certainly was a revolutionary move by Amazon and a direct challenge to brick-and-mortar giants.

However, brick-and-mortar giants too have been increasingly focusing on online sales and using technology to stay abreast in the race. Walmart, Amazon's biggest rival, already has its Scan and Go technology that allows customers to shop at its stores without interacting with a cashier.

In fact, earlier this year, Walmart announced that it will be expanding its Scan and Go technology to an additional 100 stores. Amazon sports a Zacks Rank #1 (Strong Buy). You can see  the complete list of today's Zacks #1 Rank stocks here .

Moreover, immediately after the launch of Amazon Go, Kroger announced that it will expand its Scan, Bag, Go technology to new divisions. The technology helps customers to visit a store self-checkout area for payment. Apart from expanding its Scan, Bag, Go technology to 400 stores by the end of this year, Kroger is also working on a new technology wherein customers can skip checkout and directly pay through an app.

Understandably, everyone is trying to build a loyal clientele by playing on the customer- convenience quotient. Amazon too is planning to open more Amazon Go stores by the end of this year, thus heating up the retail race.

Bottom Line

Technology undoubtedly has changed the entire retail game in the last few years, with the gap between online and offline fast disappearing. Microsoft's new technology certainly will make things easier for retailers and intensify competition.

Wall Street's Next Amazon

Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It's a once-in-a-generation opportunity to invest in pure genius.

Click for details >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Amazon.com, Inc. (AMZN): Free Stock Analysis Report

Microsoft Corporation (MSFT): Free Stock Analysis Report

Walmart Inc. (WMT): Free Stock Analysis Report

Dollar Tree, Inc. (DLTR): Free Stock Analysis Report

Dollar General Corporation (DG): Free Stock Analysis Report

Target Corporation (TGT): Free Stock Analysis Report

The Kroger Co. (KR): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
Referenced Symbols: AMZN , MSFT , WMT , DLTR , DG

More from Zacks.com




Equity Research

Research Brokers before you trade

Want to trade FX?