Whose Checkout Is It Anyway? Walmart and BJs Tech Dispute Arises
Walmart and BJs are clashing over a dispute regarding proprietary self-checkout tech.
Retail giant Walmart recently submitted a lawsuit against BJ’s Wholesale Club Holdings Inc., in the Middle District of Florida, on behalf of its patent-holding subsidiaries, Sam’s West, Inc., and Walmart Apollo, LLC, according to multiple sources.
In its complaint, Walmart’s legal team alleges that BJ’s stole Walmart-owned technology — specifically the self-checkout option for the Sam's Club mobile app (Sam's Club Scan & Go), which allows members to pay for their in-store order directly from their mobile app.
This technology launched in 2017, first allowing members to scan barcodes from their phone in order to pay from the mobile app — eliminating the need to wait in lines for checkout. Since then, the technology has progressed, now allowing consumers to scan items in their cart from any angle using computer vision technology that identifies products without requiring a barcode scan.
Additionally, the company has expanded its capabilities into the fuel category on a nationwide basis. Upon downloading the Sam’s Club app, consumers can click on a Scan & Go icon to scan the QR code at the fuel station pump and select their method of payment. Members automatically receive their member discount and receive their receipt via email.
[Related: Sam’s Club Bringing Scan & Go Fuel to All Locations]
Earlier this year, the company also launched a pilot for “Scan & Ship,” which will allow Sam’s Club members to place direct-to-home orders in the aisle by scanning merchandise included in the program.
How does this offering compare to BJ’s Express Pay? In the complaint, Walmart said Express Pay is “strikingly similar to Sam's Club's Scan & Go, offering nearly identical functionality," merely changing in-app colors and the name to differentiate the platform.
According to BJ’s website, members can pay with their BJ’s mobile app and show a QR receipt at the door. The technology is available in most club locations, and consumers can access digital coupons from the app as they shop.
During BJ’s Q4 2021 earnings call, Bob Eddy, president and CEO, said its checkout technology launched that quarter and provides the ability to “skip the checkout lines using your phone.” He said the company is leveraging solutions “to deliver a more convenient experience for our members.”
“The club channel has never been thought of as the most convenient place to shop,” added Eddy. “Our digital assets are changing that paradigm, and we believe our members will increasingly reward us for that.”
Walmart alleges it filed patents for its checkout technology from 2018 to 2020, first featuring its Scan & Go offering on the mobile app in 2016 before Express Pay entered the area in late 2021. However, BJ’s checkout solution began its piloting process in 2017, serving limited clubs in Connecticut, New Hampshire, Florida, and New York, following the launch of its new mobile app.
In the lawsuit, Walmart asked the court to award it unspecified damages, as the company suffered "irreparable injury" and BJs “upended years of hard work.” The company also asked the court to bar BJ's from continuing to infringe on the patents.
BJ's has not yet filed any motions in the case.
[Read more: Top Preferred Grocery Retailers 2022]
Retailers have gone to great lengths to provide consumers with a frictionless experience, particularly across check-out amid the pandemic to eliminate the need for close contact.
Late last year, for example, Royal Farms equipped all of its 250-plus stores with self-checkout solutions. Last September, Hy-Vee launched a new mobile payment technology — Hy-Vee Scan & Go — as well as self-checkout options for a contactless shopping experience. Additionally, computer vision and augmented reality continue to play an increasingly important role in the consumer shopping experience.
