Since the opening of Germany’s first modern cashierless store in July 2019, unmanned smart stores have rapidly expanded, with around 600 locations now operating across the country.
In just six years, retailers have introduced several different autonomous formats, with the largest share—around 270 stores—found in rural areas, according to a study from Stephan Rüschen, a German food retailing professor. Other categories include direct farm retail, specialty retail such as butcher shops and florists, and travel retail at gas stations and train stations.
Ruschen defines cashierless stores as unmanned, operating around the clock, having a small footprint, relying on cashless payments, and requiring mandatory registration via an app or access card.
“The rapid growth in unattended speaks to the convenience that it offers to consumers,” said Don Apgar, Director of the Merchant Payments Practice at Javelin Strategy & Research. “Increasing the flexibility for consumers about when and where they can buy groceries is certainly a good thing.”
Similar Models in the U.S.
Could such a model find a home in the U.S.? In some ways, it already has. One area of growth in Germany has been fuel and travel stores—similar to the convenience stores with fuel operated by Wawa.
But the model also harkens back to earlier times. The rural farm-to-consumer model was a staple in the U.S. long before the advent of cashless payments.
“Most local farmers offered a farmstand for local consumers to purchase what the farm produced, whether dairy or produce, and most relied on the honor system for consumers to leave their payment when the stand was unstaffed,” Apgar said. “Even though agribusiness in the U.S. has eliminated most of the farmstands, the pre-registration requirement for unattended shopping in Germany makes you wonder if farmstands ever existed in rural Germany.”
In Germany, the unattended model is predicated on consumers pre-enrolling to become eligible to shop in an unattended store, not unlike Costco or Sam’s Club in the U.S.
Cultural Concerns
That’s not to say there aren’t drawbacks. According to the study, app registration requirements and delayed billing introduce friction for shoppers. Additionally, many shoppers prefer having an employee on-site as a point of contact.
“Unattended retail must prioritize the needs of consumers before they will get the traction that drives growth for retailers,” said Apgar. “Those needs can vary significantly with cultural norms in our global society.”