Tesco takes on Amazon with cashier-less stores

At a recent capital markets day Tesco gave an insight into one way they are seeking to improve competitiveness against online retailers such as Amazon.

The grocer demonstrated technology that would allow customers to pick produce from shelves in stores and walk out without having to scan them or pay at a till. A series of cameras and shelf sensors relay information on what customers have taken with the bill then being totalled and paid for via an app.

The system has been developed by Israel based Trigo Vision who claim the technology is able to reduce staffing costs, improve inventory monitoring as well as reduce shoplifting. It forms part of Tesco's plan to migrate store transactions to digital to reduce the cost of cash handling. The grocer anticipates scan as you shop to be 100% cashless in 2 years and self service 100% within 5 years.

Amazon were the first to employ this type of the system in the United States with their cashier-less Amazon Go stores. The retailer are rumoured to be looking at bringing the concept to the UK with an Oxford Circus flagship purportedly being planned.

This is not the first instance of Tesco adopting Amazon's strategy, with a revamp of the Tesco Clubcard announced earlier in the year. Whilst details of this are not yet known it has been suggested that the new format may be similar to that of Amazon Prime membership, encouraging customers to sign up with additional Tesco services such as banking and mobile services.

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Supermarket Income REIT plc is listed on the London Stock Exchange. SUPR acquires UK supermarket sites that form a key part of the future model of grocery in the United Kingdom. SUPR aims to provide long-term inflation-linked income, from institutional grade tenants and the potential for capital growth through active asset management. Atrato Capital is the Company's Investment Adviser.


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