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The Los Angeles Times this morning reports that a number of supermarket chains are moving away from the long-held industry tradition of accepting personal checks for payment. Two examples: “Whole Foods Market Inc. is considering banning the use of personal checks at its stores and this month stopped accepting checks at two stores in Los Angeles County and one in Arizona as a test. Fresh & Easy Neighborhood Market, the California division of British retailing giant Tesco, won't take personal checks at any of the 70 stores it operates in California. ”

The story continues, “Vons, Albertsons and Ralphs -- the stores most likely to have a bank branch within their locations -- continue to accept checks. They also cash payroll checks, although the chains typically charge a service fee of about $1 to about 1% of the check, depending on the municipal regulations of the city where the store is located. Representatives of the chains said there were no plans to end the services, and one supermarket industry executive questioned why, in an environment of increasing competition for shoppers, a company would add a barrier to potential sales. ”

The answer seems to be that some chains feel that not accepting checks means that checkout lines will move faster, and that it also cuts down on costs in a way that can allow them to keep prices lower.

But not everybody is convinced, as one shopper who likes to write checks tells the Times, “If I was a shareholder I would say yeah. But I'm not a shareholder, I'm a shopper."
KC's View:
This last statement strikes me as incredibly important – and suggests that in some cases, it at least can be argued that the chains are acting in their own best interests rather than the customers’.

Interesting, isn’t it, that on Friday we had a piece about a New York restaurant not taking cash anymore. Today it is supermarkets not taking checks. Get the sense that something is changing?

In some ways, it occurs to me that this debate is much ado about a subject that may not matter in just a few years. Y’think the ability to write checks in the supermarket matters much to anyone under the age of 30? I suspect not…that these people use debit and credit cards, and would be amused by all the debate about a subject practically irrelevant to them.

We spend a lot of time in the retail business doing that. Way too much time.