Just a few short years ago, popular press articles were filled with announcements, discussions, and predictions about the cashless future, as retailers in various sectors began experimenting with the idea that they could eliminate any cash transactions. Amazon Go stores were prominent examples, but the restaurant chain Sweetgreen, with its 94 stores, similarly indicated that it believed eliminating cash would make the sales process easier, safer, more convenient, and more enjoyable.
The experiment has not turned out quite as intended, and in response, Sweetgreen has reversed course. All its stores will soon be accepting cash again, so consumers seeking the salad-focused fast food options can pay with their cards or the money in their wallets. In announcing the changed course, Sweetgreen acknowledged that removing cash was detrimental to some consumers, whether they were unable to use credit cards, perhaps because of their credit limitations, or simply because they prefer to pay with cash. Notably, a majority of consumers still use cash for specific transactions, even if they depend heavily on their credit and debit cards in most cases. That is, modern consumers with multiple payment options at their disposal still might prefer to hand over cash for small daily purchases, including a to-go lunch they grab at Sweetgreen for example.
The switch back to accepting cash also might represent a response to more widespread criticism of the concept of cashless retailing. In Philadelphia and New Jersey, laws already have been passed to mandate that retailers must accept cash. Similar legislation is being debated in other states and cities. Although most of these laws exempt some retailers (e.g., parking garages, those that sell membership-based services, online transactions), they apply broadly to most retail industries, including restaurants and grocers.
The embrace of cash seemingly might eliminate some of the benefits that Sweetgreen and Amazon Go hoped to attain, such as convenience and enabling cashier-less transactions, but it adds some others. In particular, research suggests that paying with cash can benefit consumers, who have a better sense of how much they are spending when they count out the bills and coins to cover the costs. Thus, cash-based transactions might reduce unintentional overspending. It also reportedly increases the sense of value assigned to the transaction; a meal bought with cash might seem to taste better than one charged to a card. Thus sellers actually might want to encourage even more cash transactions, to ensure the consumers recognize the value of their offerings.

Discussion Questions:

1. What are the advantages and disadvantages of a cashless store from retailers’ perspective? From customers’ perspective?

Source: Karen Zraick, The New York Times, April 25, 2019. See also Karen Zraick, “Philadelphia Bans Cashless Stores Amid Growing Backlash,” The New York Times, March 7, 2019