Costco bets on speed: pilot pre-scan checkout, automated pay stations promise 8-second transactions
Costco has launched a 27-store pilot of a pre-scan checkout that lets members scan items via the Costco app, receive employee verification, and pay at automated kiosks — reducing average transactions to about eight seconds per transaction.
Key takeaways
- Pilot: A 27-store May 2025 pilot uses app-based scanning, employee verification, and automated pay stations to speed checkout (May 2025 pilot).
- Speed & productivity: CFO Gary Millerchip says the changes aim to boost checkout speed and employee productivity, with kiosks averaging about eight seconds per transaction (company remarks).
- Hybrid model: The approach mixes member app scanning and staff pre-scan oversight rather than fully replacing employees (see past tests).
- Local impacts: Faster throughput could support lower per-transaction labor costs and preserve Costco’s low-price model while raising questions about staffing and data privacy.
What Costco is testing
Costco’s pilot blends three elements: mobile app scanning, employee verification, and automated pay stations. Members scan item barcodes with the Costco app as they shop; staff perform a quick verification that links the cart to a generated QR code; members then finish payment at kiosks that the company reports can process transactions in roughly eight seconds on average (pilot description and earnings-call quotes, pilot details).
How the system operates
App scanning: Members scan item barcodes while walking aisles; the app stores membership IDs and digital receipts (pilot details).
Employee pre-scan: Staff spot-check pre-scanned carts before members reach payment, preserving loss-prevention and customer service while enabling faster exits.
Automated pay stations: Kiosks finalize payment after verification; early results show smoother traffic flow and positive member feedback (company remarks).
Early results and member response
Costco reports that initial feedback has been “great” and that the system is improving traffic flow through store exits. CFO Gary Millerchip told investors the company is “achieving meaningful improvements in the speed of checkout and employee productivity” tied to mobile wallet upgrades, pharmacy pay-ahead, and employee pre-scan technology (earnings call coverage).
Company context and strategy
Under CEO Ron Vachris and CFO Gary Millerchip, Costco is expanding digital tools—mobile wallets, pharmacy pay-ahead, personalization and AI for e-commerce—to boost convenience and protect its low-cost, high-value model. Millerchip noted management believes AI and digital personalization can help grow online sales while maintaining Costco’s commitment to value (earnings-call summary).
Why this may stick where past self-checkout did not
Earlier self-checkout trials across stores in the early 2020s did not scale broadly. This hybrid model is different because it:
- Relies on member app adoption for scanning rather than forcing a full self-serve shift;
- Keeps employee oversight for loss-prevention and service; and
- Speeds final payment with automated kiosks, improving throughput without eliminating staff roles (past tests).
Consumer trends and competition
NCR Voyix Digital Commerce Index data shows age-based preferences: about 43% of U.S. consumers prefer self-checkout overall, rising to 53% for ages 18–44; shoppers 55+ prefer manned lanes. Costco’s hybrid model appears designed to serve both groups—speed for younger shoppers and staff support for older members.
Cost advantage and pricing discipline
Costco’s narrow product margins (roughly 14–15%) versus typical grocers (25–35%) support its low-price model. Faster lane turnover could reduce labor cost per transaction, helping preserve low consumer prices if the system scales (analysis).
Labor, operations and local stores
Costco frames employee pre-scan positions as productivity-enhancing, not replacements—staff verify carts and assist members while kiosks take final payments. Still, changes to register workflows could alter staffing needs, scheduling, and local labor dynamics. Costco’s history of strong pay and retention means communities will watch any operational shifts closely (reporting).
Privacy and technology concerns
App scanning and digital payments track purchases, membership IDs, and payment data for verification and receipts. Costco states the system is designed to protect member data, but broader rollout will require clear communication about data use, retention, and fraud protections. Consumers and regulators are likely to press for transparency as pre-scan and AI personalization expand (coverage).
Implications for Utah
Economic impact
Faster checkout could increase throughput at Utah warehouses, reduce lines, and boost per-visit sales without raising prices. Higher turnover per lane can help hold labor costs per transaction steady, supporting Costco’s low-price model used by many Utah families (analysis).
Political and regulatory consequences
Utah policymakers typically favor business innovation, so local leaders may welcome improvements that retain employees while improving service. Still, labor groups and elected officials will likely request clarity on staffing and local job impacts before a broad automation rollout (past reporting).
Social effects on shoppers and communities
Utah’s family-oriented, bulk-shopping culture may adopt app scanning for quick trips while older members continue to prefer employee-verified lanes for large carts. Targeted in-store training and signage can help smoothing adoption among members less comfortable with app scanning.
Practical applications for Utah residents
- Try the Costco app scanning on smaller shopping trips to test speed benefits.
- Use designated employee-verified lanes for large, bulk purchases common in Utah households.
- Watch local stores and the Costco app for phased rollouts and training dates.
Sources and further reading
- The Takeout: “Costco’s new fast checkout plan” (May 2025 pilot details)
- Sporked: “Costco changing checkout system” (earnings call quotes, pilot description)
- Parade: “Costco shoppers say the future has arrived with new self-checkout terminals” (past tests)
- Company and investor materials referenced in coverage (Q2 2026 earnings call, March 5, 2026) — see investor relations statements cited in reporting above.
