Pick ‘n Save stores across Wisconsin no longer are giving coins as change due to a shortage of pennies, nickels, dimes and quarters circulating through the Federal Reserve System.
Following a new company policy, area Pick ‘n Save supermarkets, including those in Fort Atkinson and Watertown, are asking customers to pay by charge or check, to pay with exact change, or to donate their change to a regional charity such as Second Harvest.
This action comes in response to the continuing coronavirus pandemic and the pandemic-fueled coin shortage within the Federal Reserve System.
The parent company of Pick ‘n Save, Kroger, confirmed the change late last week.
Erin Rofles, a representative from Kroger/Roundy’s Supermarkets, told area news outlets that the grocery stores no longer will return coin change to customers.
Different stores have identified area charities to benefit from this effort.
If a customer is not interested in contributing to the charity, the company has a system that will apply the remainder from cash transactions to customers’ loyalty cards so they automatically will be available for their next purchase, Rofles said.
Rosie Lenz, customer service manager at the Fort Atkinson Pick ‘n Save, said that the Fort Atkinson store actually has been promoting its “Round Up” program for charity since the start of the pandemic.
The Fort Atkinson store has been directing the spare change customers have been willing to “round up” toward the Second Harvest Food Bank, Lenz said, and that effort has been very well received.
“Our customers have been really good about that,” the customer service manager said. “It’s easy for them to do and it helps others.”
With the current coin shortage, Lenz said, Pick n’ Save has for some time been asking its cashiers not to break a roll of coins unless absolutely necessary.
She noted that the amount of coins a store can order is rationed right now, and sometimes a store does not even get what it requests, but still has to work with what it receives.
“It is just one of the things we have gotten used to,” she said.
The shift in practice — now solidified into store policy — has gone fairly smoothly, Lenz said.
“The customers have been understanding of the situation and are willing to help,” she said.
She noted that likewise, as store employees have had to get used to wearing facemasks to protect everyone’s health, a lot of the customers have stepped up to take that extra precaution as well, and people also are being pretty good about maintaining the recommended 6-foot “social distancing.”
The Adams Publishing Group also reached out to the Watertown Pick ‘n Save for comment, but there was no manager present Monday afternoon who was authorized to speak to the change.
The Federal Reserve announced in mid-June that the ongoing COVID-19 pandemic “significantly disrupted” the normal circulation pattern of coins. Once portions of the economy began to slowly reopen, there wasn’t enough coin in the system to keep up.
On June 15, the Fed and its coin distribution sites began allocating supplies of coins to depository institutions (banks and credit unions) as a temporary measure to ensure a “fair and equitable distribution” of existing coin inventory.
Other business chains such as Kwik Trip and Holiday have sent customers emails and posted signs near registers to encourage payment by debit/credit card, rewards card, or exact change.
Late last month, the National Grocers Association (NGA) and other retail industry groups called on the federal government to address the nationwide shortage of coins caused by the coronavirus crisis.
In a letter sent to the U.S. Department of the Treasury and the Federal Reserve, the NGA said a drop in cash transactions for retail purchases during the pandemic reduced the supply of coins across the country. As a result, the government must release more coins from federal inventory or boost coin production to meet immediate needs.
The letter, addressed to Fed Chairman Jerome Powell and Treasury Secretary Steven Mnuchin, was signed by NGA, as well as FMI-The Food Industry Association, the National Association of Convenience Stores, the Retail Industry Leaders Association, the International Franchise Association, the National Automatic Merchandising Association and the Society of Independent Gasoline Marketers of America.
“We were alarmed to hear that the system for distributing coins throughout the country is at the breaking point. The Federal Reserve’s announcement on June 11 that it will have to ration the distribution of coins across the country came as a shock,” the letter said.
“Some of our member businesses are being told that they cannot get coins from their banks at all. This threatens the functioning of our member businesses and, by extension, the needs of their customers.”
Retailers and industry observers nationwide report that COVID-19 has curtailed in-store purchases, due to fewer people visiting stores, and pushed more Americans to buy retail goods online.
However, the letter pointed out that cash represents over one-third of all funds transacted in person by U.S. consumers and nearly half of all funds for transactions of less than $10.
Grocery continues to be an environment where consumers prefer to use cash, with roughly one out of every five transactions being paid with cash.
“These industries need to efficiently process large volumes of consumer transactions every day and many of those transactions are paid in cash,” the retail groups said in the letter.
“A critical, but largely unseen, part of these businesses’ operations, then, is obtaining sufficient amounts of coins to be able to handle cash transactions and provide customers with change,” they wrote.
The retail trade organizations said the federal government could remedy the coin shortage in three ways: prompt the Fed distribute more coins from its inventory to ensure economic activity isn’t disrupted; direct the U.S. Mint to step up coin production; and prioritize coin distribution to “essential critical infrastructure” consumer businesses in greatest need of coins to complete cash transactions with individual Americans.
A Federal Reserve release in mid-June said the pandemic has disrupted the normal circulation of coins, and when areas began to reopen to business, there weren’t enough coins in the system to keep up with demand. Federal Reserve officials said that they are working on the issue, but their efforts will take a while to percolate down through the system to individual stores.