CHECK - OUT OPERATIONS IN A SUPERMARKET Thais Ior the Degree oI M. A. MICHIGAN STATE UNIVERSITY Joseph Emile Zola, Jr. 1956 HESI. LIBRARY I Michigan State University CHECK-OUT OPERATIONS IN A SUPERMARKET by Joseph Emile Zola, Jr. AN ABSTRACT Submitted to the College of Business and Public Service of Michigan State University of Agriculture and Applied Science in partial fulfillment of the requirements for the degree of MASTER OF ARTS Department or General Business Curriculum in Food Distribution 1956 e?‘ ///' // / 4"! Approved(/' . (ffé? ,/// ABSTRACT Profit and efficiency are important goals of manage- ment. Management continually strives to increase profits through efficiency. The remainder after costs and eXpenses have been deducted from earnings is called profit; and effi- ciency is doing the right thing, in the right place, at the right time, by the right person. Chain supermarkets operate on a net profit on sales of about one per cent. Therefore, each supermarket in the chain must keep unnecessary eXpenses and losses at a minimum, Since the cashier is the employee responsible for tabulating orders, collecting money, and making change (if necessary), she is in a position that contributes greatly in influencing whether or not there will be a profit in the supermarket. Preventative steps should be taken to avoid losses. These preventative steps should include an attempt to increase accuracy, efficiency, and speed, by having qualified checkers, properly trained, with the most suitable equipment. A qualified checker is one who has been trained in company methods and policies. Management should develop methods of checking which increase the accuracy and speed of a cashier. Cashiers should be instructed on the proper methods of handling the cash register, correct fingering, coordination, change making, check cashing, customer service, personal appearance, courtesy, complaint handling, refund handling, and balancing-out the cash register. Company policy outlines the procedure to be followed in the per- formance of the various parts of the check-out operation. The cashier is the last, and usually the only employee with whom the customer comes into contact during the shopping process. Thus, the cashier contributes to the acquisition of a good or bad name by the store, because, in the customer's mind the checker is the company. Therefore, accuracy, per- sonality, and speed are needed by the cashier so the goals of the best customer service and higher profits for manage- ment are obtained. The bagger and/or carry-out boy is an important assistant to the checker. The bagger's Job is to assist the customer and the cashier in every way possible at the check- out stand. Unloading bascarts, sacking the merchandise and placing it in the customers car, keeping the check-out area clean, assisting the cashier by checking on prices and serving the customer, are some of the tasks that must be per- formed by the bagger. Having a sacker perform these Jobs right is as necessary to the goals of management as the Job of the checker, since the bagger and the checker compose the human element at the check-out counter, and in most cases, throughout the entire market. Management should insure that suitable checkstands are used to assist the cashier in maintaining a high degree of accuracy and speed. The checkstand selected for a super- market should meet the requirements of the store in design, 3 accessibility, and size. The check-out counter used should make the cashier's work easier, quicker. and more accurate. Management must choose the checkstand that suits its parti- cular type of operation. When this is done, the customer and the cashier become satisfied with speed and service which leads to higher profits through goodwill and morale. When the proper cash register, which performs the functions desired by management, is obtained, the final piece of equipment has been added to complete the check-out operation. Management has a choice of a regular adding machine cash register, a change computer, or a refund sub- traction.model. Since the register is a machine that is both accurate and fast, the needs and wants of both manage- ment and the customer are served. Although the accuracy and speed of the cash register are limited to that of the oper- ator, the register can, in most cases, out-perform any per- son in the various checking transactions. Since there is no question as to the accuracy and speed of the cash register, the decision by management which remains is choosing the make and model*which best conforms to the wishes of the customer. I There is no profit without customers, thus the customer must be preperly served since she is the important person in a supermarket. Therefore, qualified checkers. properly trained, with the most suitable equipment are extremely nec- essary for the proper functioning of the check-out operations in a supermarket. CHECK-OUT OPERATIONS IN A SUPERMAHKET by Joseph Emile Zola, Jr, A THESIS Submitted to the College of Business and Public Service of Michigan State University of Agriculture and Applied Science in partial fulfillment of the requirements for the degree of MASTER OF ARTS Department of General Business Curriculum in Food Distribution 1956 ? v.9— d? 3" 7 ~ giamf/J To Dad ACKNOWLEDGMENT The author would like to express his sincerest gratitude to Dr. E. w. Brand, Director, Curriculum in Food Distribution, for his guidance throughout the entire school year, and for the assistance rendered in the preparation of this thesis. Words cannot eXpress the appreciation the author has for the untiring effort and long hours spent by his wife, Joan, in her assistance in preparing this text. “Thanks” are also in order for the National Associa- tion of Food Chains for making the course in Food Distribu- tion possible, for American Stores Company of Philadelphia for making it possible for the author to attend this course, and for Mr. James Simpson, Sr., American Stores Company, for furnishing much of the material used in this text. TABLE OF CONTENTS CHAPTER PAGE I. THE PROBLEM. . . . . . . . . . . . 1 Definition of terms . . . . . . . . Introduction. . . . . . . . . . . Purpose of study . . . . . . . . . Sphere of study. . . . . . . . . . ODO\U\\.OH II. TRAINING THE SUPERMARKET CHECKER. . . . . Need for training . . . . . . a. . . 10 Prerequisites of checker training. . . . 11 Training program of American Stores Company, Philaselphia . . . . . . . 12 Training schedule of Standard-Humpty Dumpty . . . . . . . . . . . . 16 Training suggestions of National Cash Register Company. . . . . . . . . 18 Recommendations of author . . . . . . 21 Summary . . . . . . . . . . . . 23 III. BAGGER (BACKING) TRAINING . . . . . . . 26 Importance of bagging correctly . . . . 27 Correct method of bagging . . . . . . 30 Summary . . . . . . . . . . . . 3“ IV. CHECK-OUT COUNTERS . . . . . . . . . 35 Importance of the most suitable check-out counter. . . . . . . . . . . . 36 The deve10pment of the checkstand. . . . b4 CHAPTER Comments by the author. . Summary. . . . . . . V. THE CASH REGISTER . . . . The National Cash Register Company. The Standard National Cash Register. The Change Computer . . The Swede Cash Register . Comments by the author. . Summary. . . . . . . VI. CONCLUSIONS . . . . . . BIBLIOGRAPHY . . . . . . . . APPENDIX. C O O I O C O O C 1v PAGE 5e 56 58 59 6o 63 65 67 69 71 76 80 TABLE I. II. III. IV. LIST OF TABLES Single Operator. Two Operators. . Three Operators. Three Operators. Four Operators . PAGE 41 42 #2 1+3 CHAPTER I THE PROBLEM Definition of Terms In order that a business may grow and prosper, profit and efficiency are essential. Training programs are neces- sary to teach employees the best methods of performing the Jobs so that they (the employees) may be better equipped to serve the customers. Policies must be established and made known to employees in order that the company's plan of action is followed. A wholesome attitude must be developed in the employees by management. The above statements may mean many different things to various types of people and businesses. In order that the reader may understand the author's concepts, the prin- cipal terms are defined as follows: PROFITS - l. The residual values which remain after costs have been deducted from income. 2. A necessary cost factor needed to keip a business operating and growing. EFFICIENCY - Performance of the right thing, at the right time. in the right place, by the right person: A principal aim of management planning. Right is interpreted to mean 'correct' or 'most suitable.' 1A. E. Benn, The Mana ement Dictionar (New York: Exposition Press, 1952. p. 2 7. 21bid.. p. 115. market, TRAIN - TRAINEE To indoctrinate with knowledge of the performance of a Job or an action, and to follow up original instruction to establish whether or not the individual being trained really undegstands that which he is being taught.' - A worker receiving regular formal training for an occupation requiring a limited degree of skillzg differs from 'learner,' who does not get formal training and who learns through actual work experience and Job perform- ance under supervision, and from 'ap- prentice', who learns a skilled trade.” TRAINING - 1. Education applied to give or ac- quire ability to exercise a specific skill: a less broad term than the con- cept denoted by education. 2. The process through which changes are brought about in the improvement of attitudes, potential behavior patterns, etc. POLICIES - Statement of aims, goals, principles, purposes, or intentions which commit management to a course of action in accomplishing specified objectives; policies are not to be confused with rules and regulations, for they change more slowly. EMPLOYEE - Each and every person, on every level, who is employed in the work of the organ- ization. The terms checker and cashier are used synonymously. A 'supermarket' is defined as a large, self-service operated by a chain. p. 335. P. 335. p. 336. p. 257. p. 119. Introduction Profit and efficiency are the goals of most top executives including those in food retailing organizations. The ideal situation sought is higher net profits and greater efficiency. Three factors are necessary for the attainment of these goals; (1) Qualified personnel, (2) suitable equip- ment, and (3) proper training. The questions then arise-- What is the prOper training program and the most suitable equipment? Who are the qualified peOple? Whenaare these three things obtained? The answers to these three questions can be found in each particular organization. Personnel, equipment, and training must be tailor-made to fit the in- dividual requiements of the employer. The buying operations in supermarkets are usually the same. The customer enters the store through a self- Opening door and takes a bascart to carry the purchases. Moving throughout the store the customer does not come into personal contact with a clerk unless there is a particular question that must be answered. The merchandise is dis- played in the supermarket so that the customer may serve herself with whatever is desired. Except for the manager who might st0p and talk, a clerk does not usually speak to the customer throughout the process of shopping. After everything that is needed is obtained, the customer proceeds to the check-out counter and either stands in line or is immediately checked out. At the L. check-out stand the customer, for the first time, comes in- to personal contact with an employee for any length of time. At this final stage of the shopping process, the first and final impression of the entire operation is made upon the customer. Every act of the checker is recorded in the mind of the buyer. If the checker is pleasant--so is the market, if she makes mistakes--so does the store, if she says ”Thank you”--so does the organization, if she is slowa-so is the management, if she is rude--so are all the personnel, and so on. Every move of the checker is in- terpreted by the customers as a move of the organization. Therefore, the right checker with the preper equipment and training is necessary in order that the customer receives a favorable picture of the operation. From a customer's standpoint, the checker is pro- bably the most important of all store personnel. With the advent of self-service meats and prepackaged pro- duce, the checker may be the only person she talks to during her entire shepping tour. In her mind the attitude of the personnel at the checkout reflects the store's attitude. A friendly greeting or a warm smile on the checker's part can certaénly confirm her belief in shopping in your store. In order to obtain high profits efficiently, the customers who already shop in the supermarket must be re- tained. An accurate check—out system with the proper equip- ment to give the quickest service with the least amount of expense is also essential in order to maintain high net profits. 8"Planning Your Work at the Checkout," Pgogressive Grocer, vol. 3“, no. 12 (December, l955),73. Pugpose of Study The purpose of this study is to suggest ways of improving checker training programs and check-out equipment. One way that management‘s goals of profit and effic- iency can be acquired is through prOper customer and clerk relationships. The cashier must treat the customer in a pleasing manner. Any act that may dissatisfy a customer must not be tolerated, for this can contribute greatly to the losing of customers. By having a great loss of customers, the store is placed in an unsteady market, which is dangerous considering the fact that the trend of the food industry since l9hu has shown an increase in sales with no decrease in sight.9 If a store places itself in an unsteady market, a position has been gained which is not in line with.the food industry. The supermarket is thus “walking on weak legs.” Without the customer there can be no profit--effi— ciency is useless. Therefore, keeping present customers is essential to the life of the business and new customers should also be sought. The qualified person, properly trained, using the most suitable equipment is necessary so that the customer receives a favorable impression of the supermarket. A properly trained person with the right equipment is needed 9 Editors of Fortune, The Chan in American Market (Garden City, New York: Hanover House, l9535,p. 157. 6 so that both the customer and the market will get what is due'to them in dollars and cents. If the customer is short- ohanged, she may never come back to the store again. Too much change given to a customer will be the cause of losing money, and over a period of time, the supermarket will be exposed to great losses. A food chain operates on a net profit of about one per cent on net sales. Thus, if a customer purchases five dollars worth of merchandise and recives five cents too much change, the chain does not make a net profit on that sale. If this situation happens frequently, the chain reaches a point where net profits are likely toldecrease. If net profits decrease, then the goals of management are not obtained, stockholders are unhappy because of the low return on investments, and money for future expansion and improvements is lost. Thus, the supermarket is placed in an undesirable position. ‘gphere of Study This study is broken down into three main divisions: l. A discussion on checker training, which in- cludes the importance of this training. several companiesf checker training programs, and some suggestions for improve- ments to training programs. 2. A discussion on the various types of check-out stands and their importance-~also, some suggestions for improvements to checkstands. 3. A discussion on the most used cash registers. Included in the study will also be an informal training program for baggere. The author feels that the best study on check-out operations in a supermarket would include all phases of the operation. For this reason, checker training, bagger train- ing, check-out counters, and cash registers have been in- cluded in this study. CHAPTER II TRAINING THE SUPERMARKET CHECKER Through training, employees are fitted more quickly for their Jobs and are given the tools they need to do their Jobs well. Training is the lubrication that reduces wear and tear in an organ- ization and helps the business run more smoothly.M3 The check—out operation is one of the very important functions in a supermarket. Every sale is completed at the checkstand.and at this point the customer receives her final and most-lasting impression of the supermarket. Therefore, a great deal of added responsibility is placed upon the checkers because of the importance of successful customer contact in a supermarket. The checker must be of such cali- ber that a lasting impression is made upon the customer that this is the store at which to buy, because the personnel is accurate, the market gives fast service and is a pleasant place in Which to shop. Accuracy - Personality - Speed, these are the prereQuisites for a really good checker. Speed is important in getting the customer through the check- out in the minimum amount of time. A pleasant per- sonality is important because it is at the checkout that the customer will form a lasting impression on the store and its personnel. But, most vital of all is the ability of a checker to be accurate. Nothing loses a customer's confidence in a store faster than the discovery of an error against her. Even a mistake 190. Preston Robinson and Kenneth B. Haas, ng to Establish and 0 rate a Retail Store (New Yerk: Prentice- Hall, lSEEI, p. 233. w in her favor tends to shake confidence, since the customer feels that if mistakes fife made, then they can be made in either direction. The average number of items in a supermarket ranges between 3,000 and 6,000, with some markets handling more. There are countless new and different items sold in a supermarket. The variety of articles that can be purchased and the speed with which the customer can get her shopping done in today's supermarkets are far superior to the markets of “yesterday." The merchandise is displayed in such a man- ner that the customer can I'pick and choose" to suit her taste. Items are easily accessible, prices are standard, and in most cases good merchandise is sold. The supermarkets attempt to utilize good locations, attractive stores, and effective advertising to bring customers to the market. Good merchandise, effective displays, and the right prices are used to keep old as well as new patrons coming back to the supermarket. The above mentioned ”lures" are useless if the check-out operation is not run in a manner that is accurate and fast. Good merchandise, priced right, and effectively displayed, persuades her (the customer) to buy. But one mistake at the cash register can ruin every ef- fort that you have made. Customers can be found in many ways but the easiest place to lose one is at the cash register.12 11"Tips on How to Handle Money at the Checkout," Progressive Grocer, vol. 35. no. 2 (February, 1956) 202. 12"The PayoffPoint--Managers' Training Course Session 1," Chain Store A e, vol. 29, no. 9 (September, 1953). insert Between 103-107. 10 Need fgngrgining A system that will assure accuracy and speed at the checkstand is necessary. A method should be created so that both the customer and the company will have the utmost con- fidence in the ability of the checker. The system must be designed to fit the needs of the organization it will serve. To believe there can be one type of system that will serve the purposes of all companies is a.fallacy. All men are different. Companies are composed of men. Therefore, com- panies are different. The goals of companies may be identi- cal, but the means of arriving at these goals are not the same because of the difference in individuals and their ideas. Therefore, what may be a good system in one organi- zation is not always the best in another. Once a loss-preventing system has been developed, proper use is essential. In order that the system may be properly used, some sort of training program is necessary. The training program can be formal or informal, depending upon the importance of the Job in the eyes of the executives. Regardless of which method of teaching the Job is used, the employees should learn a system whereby the customers and .the company are better served. Because of the importance of this training program, it should become company policy. The author has found in corresponding with many chains that checker-training procedures are company policy. If the chains feel that checker training is important enough to 11 make company policy, then there must be an extreme need for this type of training. Therefore, potential checkers should complete this course of training. Prerequisites of Checker Training In order to establish a training program there must be a "plan of action." The follOWing points may be included in such a plan:13 A. Have a time table. 1. How much skill is expected of the trainees. 2. How soon. Break down the Job. 1. List principal steps. 2. Pick out the key points. Have everything ready. 1. The right tools and equipment. 2. Materials and information. Have the work place properly arranged. 1. Everything in its proper place. 2. Set up as the worker will be expected to keep it. Before teaching traininees the company's methods, there are certain steps that should be followed by the training instructor. These steps are:14 I. Prepare the workers. (1) Put them at ease. (2) Find out what they already know about the Job. (3) Get them interested in learning the Job. (u) Place them in correct positions. 13Training Department, American Stores Company, Philadelphia, Pennsylvania. Ibid. 12 II.. Present the operation.. (1) Tell, show, illustrate and question carefully and patiently. Stress key points. Instruct clearly and completely. Taking up one point at a time, but no more than they can master. AAA PU N vvv III. Tr out performance. (1) Test them by having them perform the Job. (2) Have them tell and show the instructor, have them explain key points. (3) Ask questions and prevent errors. (h) Continue until it is known that the employees know. IV. llow'upe F0 (1) Put them on their own, check frequently. (2) Designate to whom they go for help, encourage questions. (3) Get them to look for key points as they progress. (4) Taper off extra coaching and close follow-up. 'Since the actual difference among companies regard- ing their training programs comes about in the contents of the programs, the prerequisites stressed by American Stores Company can be used as a model by any chain, regardless of the field of operation. This "plan of action” relates to the end result expected, which is the same in most compan- ies--higher profits through better trained personnel. Training Program of Agerican Stores Company, Philadelphig In the summer of 19h“, the management of American Stores Company decided to do something about the.accuracy of the checkers. The customers, as was generally known, doubted the accuracy of the checkers. For American Stores, the time had now come to do something about this doubt. In 1945, after a checker training program had been put into 13 effect, the personnel training director placed an article in Chain Store Agg about American Stores‘ simplified teach- ing method which develops competent checkers. The follow- ing is a brief summary of this article. How accurate are checkers? For years customers and management alike have debated this question. 'Of course, they never hit it exactly right, but come as close as possible,‘ one of our customers was heard to remark one day. Last summer, to settle this vital question, we began to search for a better way of checking out merchandise-~a system that would prevent loss either to our patrons or to ourselves. Under the guidance of a specialist in training, a staff of workers was assembled whose Job it became to ex- plore all known methods of checking.15 Mr. W. C. Ferguson, Director of Personnel Training, American Stores Company, further stated that check-out pro- cedures at that time were inadequate because of inaccuracy and inconsistency. The previous method of ringing merchan- dise was to check out of the bascarts. The decision was made by management to assemble the order according to de— partments and combination-priced items. In order to faci- litate the arrangement of goods, a new checkstand was de- signed which would take up the same amount of floor space but give sixty per cent more counter area. The purpose of the training program was to teach the employees how to use both hands at the same time, thus creating a quicker and more accurate operation. ~The training 15William Carlisle Ferguson, "Training Checkers for Accuracy," Chain Store Agg, vol. 21, no. 7 (July, 1945). 178. 14 program is a three day course with slower students retained an extra day if necessary. During the three day session the trainees are instructed on handling the cash register, correct fingering, coordination, change making, sacking, handling refunds and cash for deposit, mechanics of the cash register, proper procedure in check cashing, customer service, personal appearance, courtesy, and complaint handl- ing. The actual beginning of American Stores' checker training program was in 1944. Few changes have been made since then, with several modifications to take care of changing times. The checker school is attended on the first three days of the week so that the trainees may be available for work in the stores on the weekend. American Stores pays full salary while the employee is in training. .EXpenses are paid if the employee lives an excessive distance from the training school. American Stores Company checker training schedule is as follows:16 MONDAY 1. Introduction - answering the questions “Why, When, and How?” about the checker training program. 2. Introduction to Re ister. 3. Introduction on 1- Keys. 2. Practice 1-4 Keys, Addition Drill. 6 . Instruction on 5-9 Keys. . Practice 5-9 Keys, Group Prices. American Stores Company, op, cit. 15 7. Exercise 3 & 4 (tests), Group Price Sheets. 8. Instruction on Assembly. 9. Assembly Practice. 10. Instruction on Ringing. ll. Ringing Practice. 12. Instruction on Making Change. 13. Making Change Practice - Change Exercise. 14. Coupon Discussion. 15. Instruction on sacking. 16. Sacking Practice. TUESDAY 1. Review of First Day (Review at register with order). 2. Instruction on Complete Checking Operation. 3. Complete Checking Operation Practice. 50-50 exercise. 4. Instruction on Refunds. 5. Refund Practice. 6. Bottle Rebates. 7. Practice Runs - 7 to 12 Orders - (Accuracy). 8. Instruction, Checker-Bagger Team. 9. Practice, CheckerbBagger Team. 10. Checks and Credits. WEDNESDAY 1. Instruction on Mechanics of the Register. 2. Instruction on Manual Register Operation - Practice of Manual Operation. 3. Instruction unloader-Checker—Bagger Team. Practice, UnloaderbChecker-Bagger Team. 4. Instruction on Cash Disbursement. Practice Cash Disbursement. 5. Practice Single Operator, 7 to 12 Orders. . Final Runs - 1 to 6 Orders. 7. Service to Customers. 8. Discuss Score Sheets. American Stores has a follow-up method whereby the trainers visit each store to see if checking principles are being followed after students are trained. when there is a misunderstanding, the trainer demonstrates the preper method and is always ready with advice. Accuracy tests are also run to make sure that students are maintaining their school 30 0“.ch y e 16 In order that the reader may have some idea of the contents of a checker training program of a large chain, the author will break down part of the preceding outline to show the exact contents of the American Stores Company training schedule for the first day. (See appendix for the outline which the training instructors use.) Tuesday's session follows a similar pattern. The items discussed are the same as those mentioned earlier in this chapter (listed under schedule for Tuesday). Some of the more important points taken up on the second