Point of sales the places where a retail transaction is carried out and completed is known as Point of Sale. Whenever a customer purchases something from you, they make a point of a sale transaction. An efficient Point of Sale system is important because it provides smoothness to the working of the business. It helps in making sure that there is enough inventory; it keeps track of the sales and shows monthly sales reports, and it assists you in managing the customers. Therefore, with the management of sales, inventory, and customers, it can safely be called a central component of a business.
It is obvious that a POS system can be extremely beneficial for a business, but there’s still a majority of people who aren’t using it for transactions. They still rely on old school systems, such as manual methods, cash registers, QuickBooks and Excel. So why haven’t they incorporated such a useful system in their businesses?
People always hesitate in implementing new technologies, because it can get quite overwhelming. POS is a technology that brings changes in the central functioning of the business. Hence, retailers think about all the pros and cons of such technologies before going ahead with them. It’s good to learn everything you can about a POS system and then you will be able to come to an informed decision.
Types of POS Software
There are two types of Point of Sale software available. You can either purchase an On-premise POS or a Cloud POS. Let’s understand the two in a better way:
- On-premise POS needs the buyer to update the software from time to time; whereas updates are automatically “pushed” to a Cloud POS.
- An On-premise POS is one that the retailer purchases and installs on his/her own computer system; while a Cloud POS is accessed through the Internet and can be used on any device.
- When an On-premise POS is installed in large organizations, the buyer may need to utilize the help of an IT professional to run it. However, Cloud POS can be managed by only one or two individuals.
- An On-premise POS needs an expensive upfront hardware purchase, but a Cloud POS generally has lower upfront costs.
Marylise Tauzia, a professional product marketer says that it is essential for POS software to be flexible. As a buyer, you should make sure that the POS seller can work with the payment gateway of your choice. Since these applications are important for your business, the POS should be able to integrate with them easily, so you won’t have to make major changes in other applications.
Hardware Used for a POS System
Some hardware components are important to get your POS system up and running.
- Monitor: To view product databases; keep track of employee clock-in and view sales reports. You can also use tablets instead of bulky monitors.
- Barcode Scanner: To scan barcodes and add products to checkout lists. These can also be integrated with the inventory management systems to keep a check on stock levels.
- Credit Card Reader: For credit card payments, you need secure and EMV-compliant credit card readers.
- Receipt Printer: To confirm purchases after payment has been made.
Benefits of a POS System
1. Regular Sales Reports
With a POS system, you can view regular sales reports and keep track of the cash flow and inventory. The software stores significant data about all your products and makes it easier to manage them. Knowing the financial, inventory and sales statuses helps in making informed decisions for your business in the future.
2. Sales Strategies
Since you know the departments that are not performing well, you can take proper actions and come up with appropriate strategies to function better. Depending on which product brings loss or profit to the company, you can decide which one you want to keep in stock in the future. This will improve your business’ outcomes with better profits and revenue generation.
3. Better Use of Time
The POS keeps track of the stocks of products left in the inventory. You can set the software in such a way that it automatically sends orders to the suppliers when the stocks are almost empty. This helps in reducing employee engagement and also saves a lot of your valuable time.
4. Enhanced Customer Relationships
The information about all your customers is saved in the software database. So you know the favorite products and preferences of each customer and you can serve them according to their individual requirements. With different product offers for each customer, you can build a trusting relationship and retain him/her for a long time.
5. Employee Management
With POS software, you know about the number of sales made by each employee. Based on their performance you can reward the good ones and motivate them to do even better in the future. Also, since your employees can look at their own performance statistics, they can focus on the areas where they need to improve. So this software also serves as a great employee manager.
In conclusion, it’s safe to say that a Point of Sale software has an all-round extremely positive effect on your business. From inventory to sales to customer relationships, you can manage everything almost effortlessly.