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Why smart stores don't check out

Mike Elgan | April 10, 2017
Amazon, Starbucks and Apple want you to walk into their stores, pick up your items, then walk right out. There's just one problem.

Starbucks mobile app
Credit: Starbucks' Mobile Order & Pay app/Starbucks

Cash registers are dumb. Why do we still have them?

Invented in 1879 to keep saloon employees from stealing, the cash register combines the functions of a calculator to add up the purchases and a lockbox to keep cash safe.

It assumes that retail employees have no verifiable way to add up numbers. And it assumes customers are paying in cash. Nowadays, most people have a smartphone and pay electronically. So the assumptions are gone. Yet cash registers remain.

The success of online retail demonstrates that you don't need a Victorian-era contraption to sell things. You can do it all electronically.

But brick-and-mortar retail stores have a problem that online stores don't: shoplifting. Without a cashier verifying the purchase and providing a paper receipt, it's hard to stop some people from just taking stuff and walking out without paying.

The whole cash register model now represents a ritual that exists mainly as an anti-theft system.

That sounds like an easy problem to solve. Turns out it's not.

 

Why Amazon Go isn't ready to go

Amazon Go is that company's latest concept for disrupting brick-and-mortar retail. The company's vision is that you shop normally, then just walk out of the store without waiting in a line or interacting with a cashier or point-of-sale system.

amazon go 
The Amazon Go concept store watches you shop and lets you skip the cash register. Credit: Amazon

Amazon Go is a single 1,800-square-foot store in downtown Seattle that sells groceries as well as prepared food that's ready to eat. Amazon Go also features "Amazon Meal Kits," which are pre-portioned ingredients with recipes, a concept similar to Blue Apron.

The Amazon Go store is not open to the public. Amazon has been developing the store's technology for years and "beta testing" the store with employees for months. A report in The Wall Street Journal claimed that Amazon intended to open last month but delayed the launch because of technical issues.

That's not surprising. Amazon is attempting something very bold and new.

Amazon is using a combination of computer vision, sensors and deep-learning algorithms to know who's buying what. Amazon says that its patented "Just Walk-Out Technology" uses artificial intelligence (A.I.) comparable to the A.I. used in self-driving cars.

Here's how the store works. When you enter, you scan a QR code on the Amazon Go app at the front door. That scan announces to the store's system that you're there and preemptively authenticates the purchases you're about to make.

 

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