Cash Register Kaizen

My corporate life was consumed by Six Sigma and process improvement.  While we rarely used the term “kaizen” (the tiny incremental changes that have been used to drive long-term improvement in factories), we nevertheless thought about the behavior constantly.  In my private practice, I support clients in the slightly more informal “Lean” office design, which is an apple that hasn’t fallen too far from the Six Sigma tree.

I was looking at my Sam’s Club receipt this morning and I noticed the sentence, “comment, continued on back…” I turned the receipt over to see: “items sold=2, the standard paragraph about doing a survey, the date and time stamp.” Although I have seen two-sided receipts before, generally they only contain standard boilerplate text that is printed before the paper is loaded into the cash register. This receipt had been printed on both sides, on the fly, as my purchases were rung. I thought about what it took to print receipts on both sides. It requires some changes in the cash register. It also required an investment in programmer’s time to write a routine that could determine how long the receipt was, then divide that length in half and print half of it on each side of the paper.

Receipts printed on two sides of paper use exactly half of the paper of standard receipts.  Sam’s Club must print an enormous lineal footage of receipt paper in the course of the business day. Halving the number of receipts they print is a guaranteed 50% reduction in the cost of receipt paper.

  • A little bit of research shows that receipt rolls cost $.40 each in boxes of 24; presumably Sam’s Club can get them, in bulk, at a lower price.
  • Additional research at my local grocery store indicated that a cashier can expect to change out a roll at least once a shift.
  • A rough estimate of register hours per business day at my local Sam’s Club yields approximately 70 hours; at eight hours per shift that’s roughly 10 shifts minimum*.
  • Wikipedia tells us that Sam’s Club had 713 locations in the United States in 2008.
  • That’s about 2 1/2 million rolls of receipt paper a year (713 stores * 10 shifts / day * *1 roll/shift * 363 days / year)
  • Allowing $.25 per roll and cutting the total in half comes to something like a $500,000 savings per year. That will buy a couple hours of programmer time**.
  • In addition to the absolute cost of paper saved, Sam’s Club would be able to save the cost of the cashier time lost to changing rolls, the customer dissatisfaction engendered by roll changing delay, the amount of paper they need to keep on hand, the cost of shipping that much paper etc. etc. and so forth.

I do what I can to be green in my life. I write on both sides of the paper. I printed on recycled paper I get from someone else’s office. I save water in the shower and I have a low flush toilet. However, it would not have occurred to me to invest very much effort at all in trying to reduce the amount of paper that goes through a cash register receipt. While I am not accustomed to thinking of the Wal-Mart empire as a bastion of traditional kaizen, I have to step back and take this little observation as inspirational. There are many tiny incremental improvements I could be making in my own life and work, things that require a small investment to get right in the first place and then reap the benefits thereafter. I will be looking harder for them.

2/2011 Update

This post was written in December of 2009.  Sometime between then and now, I met a district manager who managed 12 Sam’s Club stores.  I asked him about the value of the double-sided receipt printing.  He said, “millions.”  I have clearly underestimated all the costs of managing register tape.  One element not included in the list above is “waste.”  Clearly, register tape cardboard cores do not take up a lot of space in the trash, but Sam’s Club has made a major effort to increase the density of products they sell, thereby reducing the number of cartons they have to get rid of.  The manager told me they’d gone from twice-a-week to once-a-week trash pickup, which is a 50% reduction in hauling costs.

*Estimate derived by counting the number of registers open at the various times of day I shop.  It’s probably much higher because I will avoid the store if the parking lot is crowded, and one presumes that more registers are open when the parking lot is full.

**May we also assume the company that supplied the cash registers picked up most of the cost of making the programming change?

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