The cost of a queue: How much revenue are you losing to lines?

When Lego launched its Stranger Things Netflix collaboration with special events last spring in New York and London, people queued in Leicester square for up to 12 hours to experience the store makeover and get their hands on the limited-edition set.

There are also a few hot tech and sneaker releases that enjoy a queue too, with the more people in it and social media impressions it creates, the better. And some popular food outlets create a line for fresh cooked cult items, like Magnolia bakery after being featured in Sex and the City, or Shake Shack starting up in New York.

It seems there are things that people will stand in line for!

For most stores, however, the opposite is true — it’s a sign the operation is not working as it should and that customer experience is suffering.

A few years ago, customers were more accepting of a queue and a call forward system that ensured a “fair” serpentine queue was a big innovation. Now customers can vote with their mouse and head online or use some of the seriously good apps available to short cut the queue. Why people stand in a long line at Disney food outlets when ordering via their app takes you straight to the front of the queue, I just don’t understand!

A UK university psychology professor, Adrian Furnham, studied queues and came up with his “rule of six” – that customers are reluctant to join a line once it has six people in it. While this is a simplification and willingness to queue will vary, it’s a useful rule of thumb.

A study of US supermarkets reported in Harvard Business Review found that customers cared more about the length of a line than how fast it was moving and that increasing a queue length from 10 to 15 people dropped sales by up to 10%.

What causes a queue?

The easy answer is that there is a mismatch between customer demand and the resources available to serve them, and this has caused a queue to build as demand outstrips capacity.

The trick is to get under the detail of your operation and understand what the drivers of your queues are. The common causes we see include:

•    Team breaks planned at peak customer times, reducing capacity just when it matters most
•    Colleagues focussing on tasks rather than customers, for example being engrossed in putting stock on the shelf
•    Click & Collect parcel pick up that takes colleagues away from the tills for a long walk to the stock room and protracted search for the parcel
•    Slow connections that add a few seconds to the average transaction time

It’s a tricky commercial balance — too few colleagues and there’s a queue; too many and you are wasting salary spend that could be invested in adding value.

Businesses are coming up with good ways to improve and eliminate their queues

1.    Mobile payment – some stores are abandoning traditional till points and colleagues have mobile payment terminals. Schuh take payments when they hand over your shoes on the sales floor, rather than taking customers to a till at the back – greatly increasing their capacity and creating a very smooth customer experience
2.    Scan and go – using apps or handheld tech so customers do their own scanning and packing with just a quick drop into a payment point as they leave
3.    Using self-checkouts alongside traditional check outs to give customers a choice and keep the lines moving
4.    Some large stores use their footfall counters to alert the checkout teams that they are getting busy and open more tills to prevent a queue starting
5.    And it’s been discussed and not yet taken off that RFID will mean products will auto scan a basket or trolley as it passes through a scanner. Perhaps, this technology has been overtaken by scan and go for customer use.

And what’s the most annoying queue in the world? When you have to queue to use a self-checkout till!

Simon Hedaux is founder and CEO of Rethink Productivity.