Smart Shopping: Paying for More Than Just Convenience

(By: Kondjeni Ambinga)

Kondjeni Ambinga

Namibian supermarket checkouts are changing shape, and not just the plexiglass screens and card readers. Before Namibia was a case, “Smart shopping” systems and self checkout machines have redefined shopping experiences in supermarkets across the globe, changing how groceries are purchased.

Self checkout systems promise customers speed and control, meanwhile they promise retailers lower operating costs and greater data about shopping habits. However for communities riddled with high unemployment rates, these tradeoffs appear as cause for concern requiring serious public debates.

Smart shopping essentially is an umbrella term for in store technologies that make shopping more automated and data rich, using technologies such as scan as you go trolleys, AI assisted shed navigation, self checkout kiosks and cashier less checkouts. Self checkout kiosks let shoppers scan, bag and pay without a cashier; more advanced smart carts let customers scan while they shop and pay on the cart itself. Smart shopping is nothing new, with roots dating back to the 1980s , however it took two decades of cheaper sensors, better software and the push for omnichannel retail to make self checkout mainstream.

When supermarkets and retail stores in the United States and stores all over Europe first embraced self checkout systems at scale the first and most obvious effects of these rollouts were to reduce the number of staffed checkout lines. Early research by the American Economic Association and subsequent industry reporting show several consistent patterns; trade analyses show that self-checkout reduces demand for traditional checkout staff, thus can manifest in reducing cashier hours or the shrinking of entry level positions, this than directly affects part time and youth employment that flows through supermarkets.

Automation creates jobs in system maintenance, IT support and in supervised self checkout attendants roles, online order picking, shelf replenishment and loss prevention roles however these positions are fewer and typically require different skills that require supervision or retail training.

The labour market is then left to struggle with absorbing displaced workers into new roles, although the net effect on displaced workers differs by supermarket chains, region and how aggressively self checkout systems have been deployed. However the risk of theft, customer dissatisfaction with fully automated experiences, has prompted some retailers to hold back on fully redesigning their smart shopping models.

Moreover academic studies and research have shown that while automation exposes many routine retail tasks to substitution, at a national level jobs continue to grow although growth is concentrated in other occupations and the workforce most exposed to automation face slower employment gains. To say, technology changes the type of jobs and which workers benefit most. With a fragile labour market, Namibia’s unemployment rate stands at 36.9% according to the Namibia Statistics Agency 2023 labour force census, with a specific high 44.4% youth unemployment rate. These statistics place Namibia among countries with the highest levels of unemployment.

President Netumbo Nandi Ndaitwah has continued to reiterate the “Namibians are too few to be poor”, I add that Namibians are far too few to have such high unemployment rates. Model one of Namibia’s largest private employers reporting to employ more 2300 employees country wide, this makes any changes to their labour model locally important.

Model formerly Pick n Pay officially opened their new store in Auas Valley in Windhoek on the 1st of October, which was described as a milestone in the Namibian retail sector by Vice President Lucia Witbooi who officiated the event. The store constitutes a multi million dollar investment for its parent company Olthaver & List (O&L), the Aus valley store is the first fully revamped roll out forming part of O&L group’s larger mission to introduce modern shopping solutions while raising the bar in customer service as well as enhancing employment standards. The new store features a robotic assistant, the first of its kind in Namibian stores, the robot is designed as a navigation tool to help customers find their way around shelves. It also features four self checkout stations.

However in a country where more than a third of the labour force is officially unemployed, the new system offers a possible stark future for many. The immediate and most visible effect will be fewer cashier positions, jobs that are filled by young men and women who need flexible, accessible employment, essentially this will make it harder for unskilled youth to find entry level employment.

While Model may reassign some staff to online fulfillment, customer help or loss prevention, these roles require a degree of skills and sometimes tertiary education and training and may be fewer positions available than the displaced cashier roles. Without structured training by model many workers could find themselves out of work. However, international experience demonstrates that self- checkout systems can increase shrinkage if not managed, forcing retailers to either rehire staff for supervision or accept large losses, neither of which outcome is ideal for wage growth or stable employment.

I do believe that this provides an opportunity for Model and regulators, policymakers to shape the outcome of this new system rollout. Before mass deployment, Model should publish expected headcount changes and the companies plan for redeployment and retraining of their current workforce, policymakers should push for or incentives such an assessment. Model alongside parent company O&L can use this opportunity to invest in the skills of their current workforce to prepare them for the anticipated rollout, by investing in short courses in retail technology supporting, basic IT skills and customer services.

This is a keen opportunity for social dialogue between corporate, Unions and government to negotiate transition pathways wage support, temporary redeployment and placement services to ensure that Models current labour force remains protected from potential labour cuts. Smart shopping and self checkout bring real life benefits for many shoppers and clear efficiency gains for retailers.

But in Namibia’s labour context, the stakes of replacing human cashiers are higher than in much more developed countries, fewer alternative jobs exist, with a high youth unemployment the labour force cannot afford a mass loss of entry level jobs. Model, as a prominent employer has an opportunity to show how retail modernisation can coexist with social responsibility. If the chain and policy makers take proactive steps, phased rollouts, retraining and hybrid models, Namibia can gain convenience and competitiveness without sacrificing the fragile job opportunities so many young Namibians need.

If not we risk trading the warmth of community shops for the cold efficiency of kiosks, leaving a generation worse off and failing the country’s youth. Kondjeni Ambinga holds a degree in Journalism and Media technology from the Namibia University of Science and technology, where she is currently pursuing an honours degree in Journalism and Media Technology. She is passionate about youth advocacy and ethical use of AI and technology to advance human lives.