POS systems. You may have heard it in passing. You may even say the term yourself, without fully knowing what you’re talking about (hey, we all do it).
When asked “what is POS?” most people will confuse it with payment processors. Some may even confuse it with a cash drawer. It’s fair enough – those things can be part of your POS. But a payment processor is not a POS, and neither is a cash drawer. So… what is POS?
POS, or Point of Sale, is a term that is commonly used in the retail industry. If you were to search for it on Google, you may come across the explanation provided by Wikipedia, which describes point of sale as the “specific moment and location when a retail transaction is finalized.” While this definition may seem simplistic, it is indeed accurate. When thinking about POS, one may conjure up memories of traditional point of sale machines, like the ones often found in fast food establishments during our younger years. Remember the familiar sound of the cash register opening and closing, as well as the loud printing of the receipt? It’s those experiences that truly capture the essence of POS. So, now you understand exactly what I mean when I mention POS.
And while that is correct in some sense, it’s not necessarily true anymore. Just like how this image of a phone, while technically accurate, isn’t really an accurate representation of a phone today.
So I’ll get to the point.
At its most basic, a POS system is where the transaction is processed. Typically, your product inventory is programmed into your POS system so you can select or scan the products your customer is buying. The POS system calculates the total owed, including taxes, processes the payment, and once paid, closes the sale. Modern POS systems adjust the inventory accordingly and add information like revenue and taxes to your POS reports.
Pretty basic, right? Anyone who has worked in the retail or service industries has likely used a POS system, even if they didn’t know it was called that.
But a POS can be much more than just a transaction processing tool. Just as phones have evolved into comprehensive tools for managing our lives, POS systems have evolved into powerful business operating systems.
So, a Point of Sale can be understood by breaking it down to its basic parts and features.
The register is where you process transactions. It’s where you scan or select products, choose the payment method, and complete the sale.
Payment processors are devices like card readers used to take payments. Some POS systems come with built-in payment processors, while others allow for third-party integrations.
A POS can also provide all kinds of shop management tools and features that help run your business.
For example, inventory management. Inventory management tools help you keep track of the products you have in stock, so it’s easier to stay on top of your stock levels, purchase orders, and sales.
Cash management allows you to count the money in your cash drawer before opening and after closing, keeps track of the cash flow coming into your business, so that you can keep track of your cash and prevent losses.
Customer management. With some POS systems, you can actually keep profiles of your customers to keep track of your returning shoppers and what they purchase. With the rising expectation of personalization in retail, it’s becoming more and more important to personalize the shopping experience by keeping track of your customers.
Staff management. Your POS can help you manage your staff, too. Some POS systems offer schedulers or rosers, and some have sales goals and staff reports to keep track of your staff’s performance.
Integrations. Probably the neatest thing about the modern POS is integrations. Not all POS systems are equipped to integrate, but the best one sure are. Going back to the phone analogy, apps are an essential part of your everyday life. We all use apps to communicate with our friends and family, to set our morning alarms, even to manage our banking accounts. Well, your POS can be like that for your shop. Integrations can include marketing tools like Mailchimp, accounting tools like Quickbooks, and so much more.
Some POS systems even integrate with your online store. There’s no question anymore that online sales are dominating the retail sphere, but most shoppers still trust retailers that have a physical store location as well, and of course, shoppers still enjoy the experience of a physical storefront. With POS systems like Oliver POS, which integrate your online store to make selling in-store and online easy as possible, you’re getting the best of both worlds.
Most POS systems in 2020 are cloud-based, meaning all of their data and information is kept up in the cloud instead of stored directly within your hardware. This has many perks, such as quicker loading time, higher security, and the flexibility to bring your POS anywhere. For the most part, cloud-based POS software can be accessed from any device – and some POS systems can even work directly on your smartphone!
If you’re looking for something a little bit more professional, many POS systems do offer hardware that resembles the traditional POS terminals. Oliver POS offers a line of powerful hardware, from a handheld mobile POS to a self-service terminal! Pretty neat, huh?
There’s actually a lot more that your POS could accomplish, but that’s the basic rundown. Now, you know just how essential a point of sale is to running your business.