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The Honolulu Advertiser
Posted on: Sunday, April 3, 2005

More turn to self-serve stations

By Sean Hao
Advertiser Staff Writer

Looking for customer service? You may need to look in the mirror.

Lisa Connais of Ka'a'awa finds that she prefers to use the self-serve checkout at Home Depot to avoid the lines at the attended registers.

Bruce Asato • The Honolulu Advertiser

Movie theaters, airports, the post office and even big-box retail stores in Hawai'i are rolling out new self-serve technologies that let consumers check in and check out without the chit-chat. Evolving from automated gasoline pumps and the Automated Teller Machine, such devices are becoming a commonplace customer-service option that's gaining increased acceptance.

"I love it," said Mayra Abendano, 32, of Pearl Harbor, after weighing and mailing her package at an Automated Postal Center near Honolulu International Airport. Abendano bypassed a line of about 10 people inside the post office. "It's so convenient," Abendano said. "I only use this now."

Nationwide, the value of such self-check transactions last year was estimated at $70 billion, according to retail analyst IHL Consulting of Franklin, Tenn.

Although that remains just a fraction of an estimated $3 trillion in total annual U.S. retail sales, the value of self-serve transactions is forecast to rise nearly fivefold to $330 billion by 2007.

Businesses are embracing self-serve technology as a way to boost customer service without increasing labor costs.

"It's a convenience for (customers). It's a convenience for us that helps them get out of the store faster," said Bill McKale, manager for Home Depot in Pearl City, where self-checkout stations account for as much as 45 percent of the store's transactions. "The benefit for us is we were able to take the hours of the people who used to be on the registers and put them on the floor to provide customer service."

In Hawai'i, six of Home Depot's seven stores have offered self-checkout stations since January 2004. The four-station set-up, which is monitored by a sales person, is manufactured by NCR Corp. and costs about $100,000 per store.

Hilton Hawaiian Village installed similar technology at the airport last September. Their four self-serve kiosks allow guests to skip the front desk by picking up their room key before leaving the airport.

The airport kiosks and three more in the Hilton's main lobby handle about 15 percent of eligible check-ins each day, primarily from business travelers, said Hilton spokeswoman Dara Young.

The list of self-serve offerings will only grow as restaurants such as McDonald's begin testing self-serve kiosks, and grocers experiment with self-serve delis on the Mainland.

Other future applications include self-serve kiosks for renting automobiles, said Mike Webster, vice president and general manager for NCR's self-service division. Atlanta-based NCR is a leading provider of self-serve technology. Its customers include Home Depot, Hawaiian Airlines and Aloha Airlines. Kiosks for filling out job applications will become more commonplace.

The main driver for the technology is its ability to speed shoppers along their way, Webster said. NCR pointed to a survey of 6,359 people worldwide released last year by IDC Corp. where consumers identified shorter lines as the top benefit to self-checkouts, followed by faster checkouts and having the option of choosing how to check out.

"The common currency for the consumer is time," Webster said. "The self-service phenomenon is taking place because consumers believe that by interacting with these machines they can save themselves time."

However, even if the line for the self-checkout machine is shorter, the process can take longer because consumers may be unable to work as quickly as a cashier. But when people participate in the process, the perception can be that time passes quickly.

Lisa Connais, 34, of Ka'a'awa, agreed that while the lines for self-checkout machines are shorter, self-checking items can take longer.

"It does, but you're not spending time waiting in line," she said after purchasing painting supplies at Home Depot in Iwilei. "It just feels faster."

The devices typically require a consumer to scan or weigh, then bag, their items, which can then be paid for via credit card/debit cards and sometimes cash.

Customers may be left to figure things out on their own, though sometimes staff are available to aid them through the process.

The machines also can have limitations, including difficulty scanning and weighing items such as cement blocks, plants and sheets of plywood. Acceptance of coupons or other special discounts also can be problematic.

Doing it yourself also can raise the risks of making a mistake — at least initially. That's what happened to Ralph Kaneshiro, 70, of 'Aiea, a customer at the airport post office.

"The first time I put the thing in there without the postage," he said pointing to a chute where customers drop off mail after affixing the correct postage.

That gaffe was easily fixed and now it takes Kaneshiro just minutes to ship packages on his own.

"If there's no line I'll go in there; otherwise I use it," he said. "I definitely like it."

Despite such growing acceptance, it can take time for people to warm to the technology.

"We find some people who are interested and some people who don't want to go anywhere near them," said Duke Gonzales, a spokesman for the airport post office. "People with experience with computers are willing to give it a shot. You find a lot of younger people willing to take the chance."

The post office has deployed 18 Automated Postal Centers statewide mostly since November. During December, when traffic peaks because of the holidays, the $20,000 machines made by IBM accounted for nearly 10 percent of revenues statewide, Gonzales said. As volume and lines returned to normal levels, that figure dipped to 6 percent of revenues.

Last Wednesday, many people continued to stand in line at the airport post office, even when a nearby Automated Postal Center was available.

People familiar with self-serve technology acknowledge there are hurdles to gaining public acceptance, particularly among those uncomfortable with technology.

"This technology will continue to be rolled out and there will be more enhancements to it and more uses for it," said Lee Holman, vice president for product development at IHL Consulting. "For people that are technology savvy that don't want to waste time at the counter these are great devices."

Reach Sean Hao at 525-8093 or shao@honoluluadvertiser.com.