Fingerprint biometrics hold promise to address retailers’ common challenges
By Vito Fabbrizio Managing Director, Biometrics Business Unit, HID
Retailers are looking for ways to upgrade their security, control costs and improve customer experiences in order to compete in a challenging landscape. Fortunately, fingerprint biometrics have matured to the point that they can deliver each of these benefits without burdening stores or staff with major costs or a complicated system overhaul.
As retailers have digitized, they have networked back-of-house and point-of-sale systems, introducing the potential to improve efficiency with as-yet underutilized tools like peripheral fingerprint scanners. These systems can yield significantly more value by integrating fingerprint biometrics, often with a simple peripheral scanner connected by a USB cable or wireless signal. By introducing certainty around who is interacting with the system through fingerprint biometrics, retailers can improve their operational efficiency and reduce shrinkage.
One fingerprint, many use cases
Fingerprint biometrics have strong potential for the wide adoption among retailers to improve their operations in several different ways. These applications are already a growing trend in the retail space, as innovative businesses find success in trials and move to production deployments.
Time and attendance
Most retail stores can realize benefits from several different biometric applications. Employee time and attendance tracking with fingerprint ensures the integrity of company time sheets while speeding up the process. Biometric-powered time and attendance systems can be secured against unauthorized use, combatting common fraud such as buddy punching.
McColl’s Retail Group is one of Britain’s largest convenience store chains, with some 18,000 employees across more than 1,500 locations. The company selected fingerprint biometrics to replace a manual tracking process that was time-consuming for store managers, and relied on the honesty and accuracy of each staff. Other options were considered, such as employee swipe cards and other biometric modalities, but due to the chances of the former being lost or forgotten, and the higher price of the latter, McColl’s integrated fingerprint scanners with its Oracle-based point-of-sale systems.
By converting manual time and attendance systems to fingerprint biometrics, McColl’s has been able to easily and accurately track employees’ hours without dispute, and store employees can be confident that they are being paid fairly.
Employees-only areas like stockrooms can be secured with fingerprint biometrics to reduce shrinkage, but POS system access will typically have an even bigger impact on shrinkage.
Fashion retailer BMA International, which operates more than 250 stores across the Middle East, had to replace its smart card system to stem a fraud problem. This is a common problem for retailers. In the National Retail Federation (NRF) 2022 National Retail Security Survey, external theft was cited as the greatest source of shrink (37 percent), but employee and internal theft came in a close second (28.5 percent). Nearly 57 percent of retailers identified internal theft as a growing risk over the past five years, with 20.7 percent of that group saying that the threat has become “much more” of a problem. The company connected fingerprint scanners to its existing POS systems to keep track of who was actually using the system, which eliminated almost all POS fraud and abuse.
Self-service checkouts can be improved with biometrics as well. The most well-known example of a biometric self-checkout system in retail is the Amazon Go stores, but these rely on proprietary palm-vein scanning technology. The same principle can be applied to fingerprint scanners for payment authorization with a modest capital investment.
A case study of fingerprint biometrics can be used in this way is provided by Norway’s Extenda Retail, which in addition to food, sells age-restricted goods like alcohol and tobacco. The chain deployed fingerprint scanners to more than 300 self-checkout locations, where customers are prompted to enroll in an automated biometric verification system when staff performs a manual age check. This allows customers to use their fingerprint to skip the age verification step for subsequent purchases, and reduces human interventions for age verification.
Benefits to retailers, customers and staff
The benefits biometrics bring for retailers in the form of reduced fraud and shrinkage costs are mirrored in advantages for staff and customers, as well.
Getting rid of physical access credentials, like employee ID cards, eliminates the inconvenience and stress of keeping track of them. Inefficient processes — like replacing lost cards or resetting passwords — can be avoided, and employee satisfaction is improved with the high level of assurance and convenience biometrics provide. Perhaps most importantly, automated age verification, like the one described above, can reduce confrontations involving staff that could potentially lead to violence.
For customers, biometrics can help speed up payments and checkout times, whether by a staff person who does not need to find an access card or at a self-checkout terminal.
Any reductions in shrinkage and staffing costs can also be passed on to the consumer in the form of more competitive prices. As inflation bites, competition on pricing will only increase, making it important for retailers to cut costs wherever possible.
The applications of fingerprint biometrics in the retail space are being pioneered by forward-looking businesses dealing with challenges common across the industry.
Explore the different types of fingerprint technology available to elevate your retail environment in this eBook, A Definitive Guide to Fingerprint Technology, and choose the one that is best for your store.
About the author
Vito Fabbrizio is Managing Director of the Biometrics Business Unit at HID Global.
DISCLAIMER: Biometric Update’s Industry Insights are submitted content. The views expressed in this post are that of the author, and don’t necessarily reflect the views of Biometric Update.