SEOUL: Local retailers in South Korea are reacting to a steep hike in the minimum wage, to enter force next year, by automating checkouts at local convenience stores.
More retailers in the country have started to run convenience stores unmanned, according to industry officials who spoke to the Korea Times. The automated service replaces human part-time workers, most of whom make minimum wage.
Some stores, including the E-mart 24 chain, owned by retail giant Shinsegae, have multiple stores that are totally automated and serve customers around the clock. Elsewhere in Seoul, a handful of the brand's stores operate with human workers during the day, and remain open through an automated night-shift.
Upon entry, customers identify themselves with their payment cards, in an effort to prevent theft and damage to the property. Shoppers pay by scanning bar-codes. If any problems arise, E-mart 24 employees are accessible through microphones installed in store.
The company contends that the conversion to automation will remove costs for owners, as well as eliminating 24-hour operation, royalties, and penalties for breach of contract.
"We are just checking the efficiency of the stores for now," a spokesperson for the company said. “We have yet to decide whether to set up additional unmanned stores.”
E-mart 24 is not the only brand in South Korea working on advanced self-service retail. In May, Cnet reported 7-Eleven’s work on palm-reading payment systems, which they trialled at the 7-Eleven Signature store located in the Lotte World Tower in Seoul.
In order to use the store with the HandPay system, customers (Lotte employees in the trial) registered their vein patterns on their store cards.
The minimum wage hike of 16.4% brought in by the country’s young government is expected to spur tech investment. “Amid the minimum wage increase, the trend of automation will spread fast,” said Yoon Jung-seon, an analyst at KB Securities.
Though Korean retailers are now turning toward the technology seriously, East Asian neighbours Japan and China have been investing heavily in these technologies, especially in Japan where vending machines have long been a feature of the cityscape. A key example is Shanghai's BingoBox, an automated store in the style of Amazon's Go stores.
Sourced from the Korea Times, Cnet, Technode, Financial Times; additional content by WARC staff