Point of sale (POS) systems are designed to help businesses manage purchases, take orders, process payments, clock employees’ hours, and deliver a high level of customer service across the board. There are numerous specialized systems on the market, including ones for retail, hospitality, and Ecommerce.
POS systems are usually made up of a combination of hardware and software components. The software you select will depend on the type of business you run and your overall requirements. Your hardware selection will be dictated by the software you choose, your budget, and the size of your business.
At their most basic, POS systems enable you to manage transactions, accept payments, and process returns when required. Usually, they are found at the checkout, although mobile systems are also available for sales floor or remote purchases.
In most cases, POS systems are run on a tablet, computer, or smartphone. Some come with their own hardware, especially if they are designed for use in specialized settings—most modern cash registers you will see in retail stores and restaurants are running some kind of POS system. Usually, you will require an internet connection for your system to function appropriately, but some systems enable you to accept offline payments.
Different POS systems come with different features depending on what they’re designed for. However, many tools are consistent across the board, including those we’ve outlined below.
Arguably the most important feature of POS systems is their ability to process transactions. This enables you to offer a streamlined checkout process, and it’s a great improvement from the clunky, manual cash registers of days past. You can also process returns and, in some cases, accept offline payments for later processing.
If you run a retail or hospitality business with a large inventory, a POS system with strong inventory management tools will be invaluable to you. Your system will keep track of all sales and returns, enabling you to stay up to date with your inventory levels. Some systems even include automatic ordering tools to replenish your stock.
Most POS systems include some sort of advanced reporting and analytics tools. With these, you can view a variety of metrics about your business and its day-to-day operations. For example, you might like to have a look at your restaurant’s sales performance and labor costs at different times of the day. Or, you could keep track of your most successful menu options, removing those that aren’t ordered often enough to be worth keeping.
Your POS system should include some sort of customer relationship management (CRM) tools. With these, you can perform basic tasks such as storing customer contact details and order information. Often you can also use these tools to develop and manage loyalty programs and send out relevant marketing material to encourage past customers to return to your business.
Last but not least, most POS systems come with some form of employee management and time-tracking tools. You can take advantage of these to log employees’ work hours, manage rosters, and log customer complaints and performance metrics.
There are numerous POS systems on the market, which can make it difficult to select the right option for your business. Here, we outline a step-by-step approach to selecting the best option for your needs.
Before you even begin researching the different POS systems on the market, we’d recommend sitting down and making note of exactly what you hope to accomplish with your new system. This will largely be dictated by the type of business you run.
For example, if you have a restaurant, you may need a system that offers flexible menu options, tableside ordering, and other hospitality-specific features. Retail store owners often require advanced inventory management tools, and service providers may need a system that has some sort of appointment booking or scheduling features.
If you’re planning to upgrade from an existing POS system, you should identify any issues you’ve had with this system. This will help you select the right option going forwards.
Think carefully about what features are lacking from your existing system and why exactly you want to upgrade. What tasks do you need your POS system to make easier? Do you need more advanced marketing tools? The ability to implement a loyalty program? Or, perhaps you just need a more streamlined employee management interface.
Different POS systems are compatible with different types of hardware. If you already have a certain type of hardware—for example, iPads connected to a central computer terminal—then you will be able to save a lot of money by selecting a new system that’s compatible with your hardware.
Similarly, you need to ensure you have the right type of hardware for your business. There’s no point in purchasing a POS system that only runs on Windows or Mac devices if you have a mobile business. In this case, you would be much better off with a smartphone-compatible solution.
Chances are you’re already using some sort of other software alongside your POS system. To ensure streamlined operations going forward, ensure that the POS software you select integrates with any platforms you use for E-commerce, accounting, CRM, etc.
Keep your long-term business goals at the front of your mind and ensure the POS system you select is compatible with them. Let’s say, for example, that you plan on adding a small cafe to your existing retail store. In this case, it would be a good idea to select a system that offers both retail and hospitality features.
This should be quite obvious, but there’s absolutely no point in selecting a POS system that’s going to be too expensive for your budget. Prices can range to hundreds or even thousands of dollars per month for high-end systems.
In simple terms, a POS system works by providing a simple, user-friendly interface for you to accept payments, manage inventory and employees, perform CRM-related tasks, and more. There are a few different aspects of POS systems worth discussing.
Setting up a POS system is generally as simple as switching on your hardware device—such as an iPad, computer, or smartphone—and installing the software. Then, you will need to customize your user interface and the other aspects of your system to ensure you have access to the tools you need. For many businesses, this will involve different interfaces for different types of users, such as managers, employees, or customers. In many cases, your POS provider will help you with setup by providing a full demo of the software.
Following deployment, familiarize yourself with your system before using it in a real-world setting. Every system comes with a different user interface, but there will usually be options for accepting cash and credit card payments, processing returns, and taking orders (if applicable). You may also have access to a range of other business-specific features, such as an employee time clock.
Once again, the way the different hardware components of your POS system work together largely depends on the devices you’re using. In simple cases, a single tablet or smartphone is all you need to accept payments. Larger businesses may upgrade to several mobile devices connected to a single central terminal. In some cases, you may even have devices from several locations connected to your central POS processing terminal to ensure inventory and performance are tracked across locations.
When someone pays you with a bank card or other digital payment method, your system will need to collect a small number of financial details in order to process the payment. Because of this, many POS systems include security features such as end-to-end encryption, which means that this payment information is protected from the eyes of hackers and other malicious third parties.
Most POS software is available with a simple monthly fee, although a few systems charge a percentage of your sales instead.
Prices can start at around $14 and increase from here, with more advanced systems becoming much more expensive, but offering plenty of features for the price. Percentage-based fees make for an excellent option for low-volume retailers.
It’s also worth noting that most POS systems offer some sort of free trial, enabling you to test the software before committing to a long-term subscription.
Along with software subscription fees, you should budget for some sort of hardware purchases. Some systems offer specialized hardware as part of an initial startup package, some offer optional hardware for an extra cost, and others require you to provide your own tablet, smartphone, or computer.
If you run a business that accepts anything other than cash payments, you will need some sort of POS system. These streamline the payment process, enabling you to keep track of transactions, process returns, and ensure your stock levels never get too low.
There are numerous POS systems on the market, and most of these are designed for specific business types. Follow the guidelines we’ve outlined above when choosing a new system for your business, and don’t be scared to test a few different platforms before settling on one.
The selection process may take a little time, but your POS system is a business essential that’s worth getting right to ensure a streamlined, hassle-free experience for customers, employees and owners alike.