Wait! Don't smash that self-checkout machine

The common kiosks frustrate shoppers, but you can make some money by investing in them.

By Kim Peterson Feb 3, 2010 2:47PM
Groceries © Tom Grill/CorbisThe self-serve kiosks at store checkouts drive me bonkers, yet I still use them. Why?

Because I hate waiting, and when I see a long line for a human cashier but no line for the automated checkout, it gets me every time. I hope against hope that I won't have to call for help when the system doesn't recognize a bagged item or when the price scans incorrectly or when I buy wine or when I can't find the darn code for oyster mushrooms. And I'm usually wrong.

So did I cheer, just a little, when one man smashed a kiosk with a crowbar? Ahem. At any rate, these little monsters aren't going away. So how about getting even by investing in them? Investopedia lists some ways.

First off, this trend is big. Nearly $6 billion will be spent on these systems by 2013, and retailers that use them could generate $1.3 trillion from the technology, according to Investopedia.

I have no idea how someone could estimate this, but you can see how these numbers would appeal to retailers that operate on razor-thin margins.

One heavyweight in this business is NCR (NCR), which has systems in Wal-Mart (WMT), Home Depot (HD) and other retailing giants. Most recently, NCR has been working with Blockbuster (BBI) to place DVD rental kiosks in supermarkets. Blockbuster is going after Redbox, which is owned by Coinstar (CSTR).

After falling below the $10 mark in December, NCR shares have been on a march and recently crossed into the $12 range. Shares have been dragged down by $1 billion in underfunded pensions at the company, according to Reuters. Investors will just start to see the results of NCR's DVD kiosk initiative this year.

McDonald's (MCD) has successfully tested self-serve kiosks in Europe made by Wincor Nixdorf (WNXDF), according to Investopedia. Now the fast-food chain plans to roll out the technology to 2,000 European stores.

One way to play this, according to Investopedia, is to invest in WisdomTree International Technology Sector ETF (DBT), which includes Wincor Nixdorf in its 58 stock holdings.

Finally, Zoom Systems is also developing the technology and was picked by Apple (AAPL) and Rosetta Stone (RST) to build kiosks for airports and other places.

Although Zoom Systems is privately held, it does partner with Motorola (MOT) and Goldman Sachs (GS), Investopedia reports.


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