What are Point of Sale Systems? Features and Advantages

A variety of administrative, management, and marketing abilities are required to run a retail store. These abilities are required for your store to run successfully, from ensuring that there is enough inventory to compiling monthly sales statistics.

 

Having a good point of sale (POS) system may help ensure that all of your operations are running smoothly, and retailers who invest the time and resources to set one up before they need it will reap the rewards. You'll need POS software if you want to start selling in person. 

 

POS software is what you'll use to manage store operations, ring up customers, receive payments, and track store sales, whether you want to sell at events, plan your first pop-up shop, or are ready to build your first permanent site. 

 

The term "point of sale" refers to the location where retail transactions are completed. Think of it as a cash register on steroids. The cash drawer, credit card swipe bar, barcode scanners, receipt printers, and other transaction-related hardware and software are included in the POS.

 

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What Exactly Is a Point of Sale?

 

The moment and place where a firm rings up a customer's order is referred to as the "point of sale." For this, the POS system uses a combination of hardware and software components. Before looking for a POS system, it's best to understand how these components work. 

 

This information is critical when planning a budget for the solutions that are best suited to your demands. Beyond credit card processing, the latest point of sale software allows businesses to add mobile POS features, contactless payment alternatives, ecommerce integration capabilities, and more.

 

Your customer makes a payment for products or services at your store using a point of sale system, or POS. Simply explained, a customer completes a point of sale transaction every time they make a purchase. 

 

Your firm can collect payments from customers and keep track of sales with a POS system. It may appear straightforward, but depending on whether you sell online, have a physical location, or both, the setup might be complicated.

 

The cash register in a store is referred to as a point-of-sale system. Modern POS systems are totally digital, allowing you to check out a customer from anywhere. All you need is a POS app and a device that can connect to the internet, such as a tablet or phone.

 

 

Hardware Components of a POS System

 

These are the most typical physical components needed to set up your POS.

 

1. Receipt printer

 

Although email and text receipts are becoming more popular, paper receipts are still necessary for giving customers a rapid overview of their purchases or returns.

 

2. Cash drawer

 

Cash may fade away in the future, but it is still king. You'll need a safe place to keep cash for transactions until then. Another advantage of cash is that there are no credit card fees.

 

3. Monitor/tablet

 

Displays the product database and allows for other operations like employee clock-in and sales report viewing. Tablets, particularly iPads, are frequently used to replace larger monitors.

 

4. Barcode scanner

 

Makes the checkout procedure more efficient. Scanning barcodes retrieves product information and adds it to the total at checkout. Inventory management systems can use barcode scanners to automatically modify stock levels.  

 

5. Credit card reader

 

Secure and EMV-compliant credit card readers have been a must-have since the EMV payment standard went live in 2015. Non-compliant retailers risk incurring significant losses due to fraud liability.

 

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Equipments involved in a POS

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Equipment Installation

 

There are two components of POS hardware that cannot be removed. It consists of a barcode scanner and a display device. Both of these devices are required to scan goods and, respectively, display the transaction. In addition to this, there are the following elements to consider:

 

1. Consider purchasing an uninterruptible power supply (UPS) if you opt to install the complete system, including desktop devices, to prevent data loss in the event of a power outage.

 

2. Connect the hardware components to the internet and to each other. Internet connectivity is required for cloud-based POS use.

 

2. Connect the iPad or POS system to a printer, select a receipt template, and begin printing. Furthermore, why not go green and simply email the template? Thus, you obtain the clients' email addresses to send them promotional emails.

 

Software Setup

 

These subsequent stages will differ significantly based on whether you go for a native POS or a cloud-based software solution.

 

1. Native POS

 

Typically, personnel from the service provider's business will come to your location to install and demonstrate the POS system.

 

2. Cloud-based POS

 

Using cloud-based POS software makes the procedure significantly simpler. You only need to interface your store's database with the POS software, as the backend is complete.

 

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Evolution of POS

 

The point-of-sale system has progressed from its original form as a simple cash register. It has evolved into a full-fledged retail management software that allows merchants to automate and manage all of these tasks from a single platform, including inventory, transactions, and sales, customer connections, bookkeeping, and more. 

 

With the introduction of bar codes in the 1970s, graphical interfaces in the 1980s, and online ordering in the 1990s, POS systems have evolved along with technology.

 

POS grew more complex and digital as technology advanced. The system was digitized and moved to the cloud. While many merchants still favor simple POS systems, it cannot be denied that a growing number of others are becoming comfortable with more advanced POS systems.
 

 

Features of POS Systems

 

Some of the features of a POS System are:

 

1. Client and supplier orders: You may need to put a product on hold for your customers so that they can purchase it later. When you run out of stock of an item, yet a buyer is eager to buy it, you're in a similar predicament.

 

2. Purchases from connected suppliers: POS systems can also track supplier purchases. Supplier purchases can be done to ensure the smooth operation of the firm for good inventory management. The POS system can record any purchases made by the shop to help with tracking.

 

3. Invoicing: One of the key functions of POS systems is to record the transactions that your store makes. When lines form, it's critical to have software that allows you to scan and sell things quickly, therefore having such software is advantageous to a retail firm.

 

4. Customizable and consistent reports: A POS system may provide reports on a range of topics, including accounting, sales, inventory, and so on. It outlines a company's operations over a specific time period and provides insight into how the company has evolved over time.

 

5. Managing several stores: Using the same POS system, you may manage multiple stores. Most POS systems are built for single-location businesses and are not suitable for franchises, buying groups, or corporate networks.

 

6. Effective inventory management: With a cloud-based point of sale, you can keep track of your inventory in real time and know how many items you have on hand at any one time. When you receive your order, simply scan or enter the products, and everything will be saved in the software.

 

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Advantages of a POS System

 

As previously said, POS systems improve customer happiness, save employee time, eliminate errors, simplify tax accounting, and reduce fraud by precisely and effectively processing and recording transactions. There are many advantages of a POS System which include :

 

1. Assist brick-and-mortar retailers in standing out

 

Even the tiniest businesses may employ modern "bells and whistles" like real-time visibility into inventory and customer history to provide store associates with the knowledge they need to upsell/cross-sell and make smart product suggestions, thanks to technological advancements.

 

2. Capture more data and put it to better use

 

Retailers can use a POS system to acquire information into individual store performance, customer buying habits, team member performance, popular SKUs, and inventory issues that could signal supply chain interruptions. They can maintain a tight check on the important inventory KPIs.

 

3. Assist retailers in becoming true omnichannel

 

Whether they're shopping online or in person, today's buyers want tailored experiences that are consistent. To build an experience that improves consumer loyalty, omnichannel businesses must not only synchronise inventory and pricing, but also pull in order history, support issues, and preferences.

 

4. Obtain solid integrations

 

Data from POS systems can be automatically linked with the company's ERP system to track in-stock items, pricing, and shop performance, as well as with customer relationship management (CRM) systems to track buyer preferences, lifetime value, and more. This makes the most of business system investments.

 

 

Types of POS Systems
 

 

1. Mobile POS System

 

Compared to a desktop POS, a mobile POS is significantly smaller but as effective. It consists mostly of a smartphone software and a card reader. Consequently, you can begin selling as soon as the POS software is activated. Included among the available accessories are barcode scanners and receipt printers.

 

2. Desktop POS System

 

These systems operate on a desktop or laptop computer via an application, a web browser, or an on-premises system. This register functions similarly to a conventional cash register due to its cash drawers, barcode scanners, and swipers.

 

Examples of businesses that profit from desktop POS include restaurants, grocery stores, fashion stores, bookstores, salons, and spas.

 

3. Tablet POS Systems

 

Both the tablet POS and the mobile POS are installed on mobile devices with various attachments. Tablets differ from smartphones simply in that their screens are often larger, hence displaying images with greater clarity and vibrancy.

 

4. Self-service Kiosk POS Systems

 

Self-service POS systems enable clients to make purchases without the presence of an employee. By implementing this approach, firms will be able to enhance productivity while reducing labor costs.

 

In a self-service POS environment, transactions are often unilateral and all associated risks are eliminated. These POS systems are comparable to desktop POS systems, but have added security measures.

 

5. Integrated POS Systems

 

This is meant to run simultaneously to ensure that different technological components are compatible with one another and prevent system conflicts.

 

With an all-in-one point-of-sale (POS) system, you receive everything you require from a single source to operate your point of sale. This saves money, facilitates business operations, and makes future customer service much simpler.

 

6. Industry-specific POS System

 

When addressing point-of-sale (POS) types from an industry-specific perspective, the most common worry is the various and specialized characteristics that businesses need to operate efficiently and successfully.

 

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You must keep up with the latest advancements in POS technology to stay ahead of the competition. If you're shopping for a POS system for the first time, make a list of the features you want and chat to other business owners in your industry. 

 

Inquire about their point-of-sale systems and what they like and don't like about it. A POS system can completely transform your online shopping experience. You can remove manual data entry, maintain track of inventory in real time, offer cross-channel promotions and customer incentives, and facilitate in-store returns and pickups by integrating with your ecommerce business.

 

If you're in the market for a POS system for the first time, create a list of must-have features and speak with other business owners in your industry. Inquire about their POS systems and what they like and dislike about them.

 

Whether you're just exploring the idea of selling in person, contemplating opening your first pop-up shop, or preparing to open your first retail store, it's important to find POS software that helps you now and in the future. Choose a POS system that will facilitate your expansion.