Marks & Spencer to roll out self-service tills to cut costs

The retailer has had to cut costs to survive – but chief Stuart Machin must beware of eroding customer standards and service

MARKS & Spencer has vowed to push on with adding more self-checkouts across its stores, after it installed hundreds last year in an effort to slash costs.

The retailer revealed it had added 800 self-checkout tills to stores over the past year in an effort to make its shops more efficient. The rollout is part of plans to save £150m this year.

At some stores, around 70pc of food sales are now made through either self-service checkouts or the retailer’s “Scan and Shop” mobile phone app.

M&S has recently been speeding up the introduction of unmanned tills into its clothing and homeware stores, adding 300 in the past year.

Chief executive Stuart Machin said there were no plans to pause a rollout despite criticism from some charities and customers.

Campaigners have raised concerns that self-checkout tills can be difficult to use for elderly or disabled customers.

Caroline Abrahams, charity director at Age UK, said: “Many older people also really enjoy the human interaction they get from speaking to a member of staff at the till.” Silver Voices, a charity, added that the tills could be “uncomfortable and inconvenient” for some older customers, while disabled shoppers would also find it impossible “juggling heavy items in front of selfservice tills to find the barcode”.

Earlier this year, M&S faced a backlash on Twitter after one wheelchair user said the checkouts were too high for her to use, while others were too close together.

M&S said at the time that its checkouts met accessibility standards but that it took customer feedback seriously.

Mr Machin said the retailer was being very sensitive to feedback and watching customer reaction “very carefully”. M&S has stressed customers will always have the choice to go to manned tills.

Expansion of self-service tills is part of wider efforts to cut costs by more than £400m over the next five years. M&S was hit by inflation in its latest financial year, revealing an 8pc fall in profits before tax and adjusting items to £482m. Mr Machin said the retailer had faced “significant headwinds”, including inflationary pressures.

‘Once a business loses a key selling point, it is very hard to get it back’

Sales up, profits up, and a scorching 13pc share price bounce, not to mention the restoration of a dividend axed during the dark days of the pandemic. Can this be the same Marks & Spencer that has seemingly spent the last 20 years in a state of perpetual decline? Or the M&S that chairman Archie Norman warned was in danger of disappearing within a decade when he was parachuted in to work his fabled turnaround magic in 2017?

Chief executive Stuart Machin can barely contain himself as he points to “sustained trading momentum”, “quality and value” in food at a six-year high, and improved sales “in store and online” – or what is nauseatingly referred to as an “omni-channel model”. M&S, he says, is “a special business with so much potential”.

A day away from his one-year anniversary in the hot-seat, it is probably fair to say that Machin thinks that some of that potential is being tapped again.

Yet it wouldn’t be M&S if there wasn’t something lurking amid the piles of unwanted oversized chinos, waiting to dampen the mood. Buried away on page eight of the annual report is a development so grim that the M&S die-hards will be left choking on their prawn mayonnaise sandwiches.

It is every shopper’s worst nightmare – the proliferation of the dreaded self-checkout. There can’t be a human being on Earth that doesn’t hate them. There are four of the things in my local Co-op and nearly everyone I see avoids them like the plague. People prefer to join the queue for the tobacco counter, even if it is already seven or eight customers deep and there’s only one employee on the till, rather than brave these technological mind-scramblers.

Why bother? Who has the time to keep scanning the same item over and over again until the laser finally recognises what it is you are trying to pay for? Or the patience to wait for a staff member to come over because you’ve put said item in the bagging area but the computer hasn’t recognised it? And what’s the point anyway if a till supervisor keeps having to intervene because of repeated system errors?

The wait for someone (anyone) to spot your panicked expression and finally respond to the flashing red light is enough to make a person shop at Aldi – a place where the queueing part takes longer than it does to fill a trolley – for the rest of their lives. So the news that M&S is planning to install yet more in its stores is desperately depressing. It has added 800 in the last year alone. The only reason that so many major retailers insist on stuffing their shops with self-checkouts is in the seemingly never-ending quest for lower overheads, as M&S makes perfectly clear. It’s a race to the bottom.

The company’s latest cost-cutting programme envisages more than £400m of savings over the next five years.

No doubt a slimmer cost base is an important part of any survival plan but so too are customers, and it’s certainly not going to improve the shopping experience, whatever anyone in senior management tells you.

M&S says self-checkouts will soon be commonplace in its clothing and home department too. Until now, they had largely been confined to grocery shopping but the decision to deploy the machines across its stores conjures images of a dystopian future where the typical shop has been all but emptied of floor staff altogether, leaving confused customers to fend for themselves before they give up and walk out empty-handed.

The implications for a high street already emptied out in many places are huge. Even the most loyal of bricks and mortar fans will begin to ask themselves why they continue to trudge through the doors when they can no longer be guaranteed even the most basic levels of service and you can buy everything online for a fraction of the hassle and heartache.

M&S needs to tread carefully. The retailer is clearly riding high. A doubling of the share price, albeit from near record-lows of around just 90p last October, suggests investors are beginning to believe the turnaround story.

Full-year profits are up by a fifth, smashing City forecasts, and as its food offering goes from strength to strength, some pizazz seems to have been restored to a clothing arm that appeared well past its best.

M&S is certainly in a much better place than John Lewis, yet the flagging fortunes of its arch-rival offer a salutary lesson in the dangers of wielding the axe too keenly. Once upon a time the pair represented the gold standard in how to treat customers. It set them apart from the competition for decades.

But a common complaint among John Lewis shoppers today is that “skeleton” store staff has led to an erosion of standards and service. There are several painful lessons that some of the most established retailers have learned. One is that consumers are fickle; the other is that once a business loses a key selling point, it is desperately hard to get it back.

The experience of somewhere like Middlesbrough should focus minds. Within just a few hundred square metres, the town centre has lost House of Fraser, Debenhams, TK Maxx and – you guessed it – Marks & Spencer, in the last couple of years, leaving the local newspaper to lament the sea of “to let” signs and whitewashed windows in the area.

We need fewer ghost towns, not more.