Ed Bedington reports on how the computerised kiosk could liberate a c-store and provide it with a range to compete with the multiples Finding space has always been something of an inconvenience for the average convenience store. Offering any product beyond the traditional boundaries is usually rendered impossible, simply because of constraints of size. But with modern technology, could convenience stores become the latest place to buy a car, or somewhere for shoppers to book a holiday and pick out some sports gear for their nephew's birthday? The development of the computerised kiosk is seen by some as one way to revolutionise the world of convenience retailing. There are a handful of pilot schemes being carried out across the UK, with companies such as Moneybox teaming up with Spar and VCS Timeless working with T&S Stores to develop viable kiosk operations. United Co-op has been operating a pilot since April in four of its stores, whereby shoppers order items on screen in the kiosk, pay at the till and enjoy either a home delivery or delivery to the shop. New channel development manager Bob Taylor says the chain has recently expanded the kiosks' offer beyond purely electrical goods to encourage further use. He says the original concept had some success but did not attract the number of users it had hoped for. Now, people can order novelty cakes, garden furniture and barbecues. Customers can also print out coupons on the screen which give details of special offers. The kiosks are not online and at the moment are more like hi-tech catalogues, with customers printing off a barcode and paying at the checkout, but Taylor adds, if the pilot proves successful, it would introduce card payment at the kiosk. "We're using it for additional range ­ a kiosk is the only way we can put this kind of range into a c-store." Moneybox is another company taking the issue seriously and it has just finished a successful pilot in a number of Spar stores across the UK. MD Paul Stanley says the company's ATM cash machine operation pointed the way towards kiosks as well as providing the network needed for its implementation. "We are the UK's leading deployer of ATM cash machines, most of which are in small grocery or convenience stores, and in getting to know that community we realised there was a genuine desire to offer more in store, but space was a problem. "We have developed a good telecoms network with the cash machines and we put the two together and came up with the idea for the Smart Shopper kiosks." Stanley describes the kiosk as an electronic shelf in store which allows consumers to buy sports goods, fresh flowers, theatre and concert tickets and holidays. He says: "The Smart Shopper offers things that would not necessarily be available in the neighbourhood. There are people who don't have access to the big shopping centres so the ability to get these kinds of things in their local Spar store is a big advantage." Moneybox says the results of the pilot were encouraging, with about 15,500 people using the kiosks over a 12-week period, with fresh flowers proving most popular. Stanley adds: "We certainly had more people using it than we expected.We found good locations with a killer application and the retailers promoted them heavily. I think that is the X factor." But the pilot was not without teething troubles, one of which was the collapse of Flowers Direct, the online fresh flower company. Paul Houghton, manager of a Spar store in Blacon, Chester, took part in the trial: "We had it from October right through the Christmas period while they tested the system. It went slowly, and we didn't take many orders, but that might have been because they didn't have any well known retailers on there." He says there were a number of problems with the software, partly caused by the demise of Flowers Direct, but adds the machine did attract a lot of interest. "I'd give it another go because it brought people into the shop once they knew it was there." Spar's retail director, Steve Blackmore, says the pilot made it clear that more work was needed on the system, but it offered value. "We see it as a bolt-on to our business, offering a different service to our customers. I think there's a real opportunity ­ there was a lot of browsing the machines, but not much purchasing, but that will come." However, Blackmore says the system has to offer value if it is to succeed. "You must be careful in terms of e-commerce and not just follow the me-too route. If they can get the right links with the right retailers we've a good chance. "We want genuine brands on there to make it worthwhile. If you get big names then you've got a much better chance than using second division players. "We're more than happy to deliver a network of shops if they can deliver premier brands." Rob Hudson, a principal consultant with PricewaterhouseCoopers, says many organisations are feeling their way. "The pilots are based on the model that the convenience store is a connector, or a focus point in a community. The retailers benefit from the extra traffic, and the possibility of increased sales and it allows customers to go somewhere local and have access to goods not typically available in the c-store. "There are no results yet to suggest whether that is a good model or not, at the moment it's really just the first step. It's early days and people are experimenting." Early days appears to be a commonly used phrase when it comes to kiosk development, and with only a few brave companies forging ahead, progress seems slow. "The opportunity is there," according to Gordon Venters of kiosk manufacturers Epoint. "A kiosk allows shops to offer a much wider range than a small store can. "A convenience store is easily accessible and a kiosk has the potential to offer as big a range as a supermarket." At the moment though, Epoint is not venturing into the world of convenience, but Venters says it is watching the pilots closely. "Our products have potential applications for the grocery sector, but at the moment we are looking at bringing down the costs, and bringing the technology forward, making them easier to use, more reliable and less costly." But does this reluctance to jump in suggest that when it comes to kiosks, convenience is not the way forward? Getting the offer right is something that will be key to the success of any kiosk operation according to consultant Andrew Barstow from Cap Gemini Ernst and Young. "There's confusion about what to offer on kiosk, the offering must fit in with the business strategy. Kiosks in convenience stores are after the busy passer-by who wants to quickly order something." He says adopting a me-too approach as witnessed in the internet explosion would simply spell disaster. So, for now the jury is out on kiosks, but Moneybox's Stanley says improving the retail offer is something on which it is working hard. "We've been going through a period of getting the well known high street brands comfortable with the concept. We're hoping to get some of the major catalogue retailers on board." Epoint's Venters agrees, saying the future success of kiosks lies with recognised brands and retailers taking it forward. United Co-op's Taylor emphasises that retailing needs to move forward. "If we take the concept of convenience on it's broadest level, if we can offer value and convenience on any product, there will be a take-up. "Teenagers and young adults are all growing into young families and they are all happy to use this technology. In terms of the future I think kiosks have got a big role to play in retailing." Despite the apparent success of some pilots, T&S stores' trials with VCS appear to have not gone as well. A spokesman says: "There has been no evidence to suggest any material increase in footfall attributable to the kiosks." But the company insists the trials are continuing, and it is testing kiosks in a dozen sites across the UK. Perhaps one reason for the lack of interest is the general disillusionment with the number of people with online access. But Moneybox's Stanley dismisses this: "In Japan, where home internet usage is high, the concept of kiosks has really taken off in the 7-Eleven chains." Cap Gemini's Barstow says kiosks and the internet can work hand in hand. He believes it is likely people will use the internet to browse and then, because of security fears, purchase through a store kiosk. So will kiosks become a powerful tool in the convenience arsenal, or are we just seeing the latest damp squib of the dotcom era? Whatever the outcome, kiosks allow retailers to offer a wider range of products than they can fit into a store, and with space tight, that's an attractive offer. {{FEAT. GENERAL }}