A feature-rich point-of-sale (POS) system is one of the most valuable tools for a retail business. This software can fill many needs: It can track inventory, process credit card payments and provide unique insight into how your business operates. The ability to accomplish all of these tasks with one system not only helps streamline how your business is run but can also save you money.
A good retail POS system can integrate multiple areas of a business into one interface, but what other components are vital to retail businesses? Before you buy a POS system for your business, learn what features to look for.
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Benefits of POS systems for retail
Whether you're operating an online shop from your living room or have several physical stores, there are many benefits of using a POS system to run your retail business. From speedier checkout to inventory management, here's a look at the top advantages of retail POS software:
- Ease of use. A modern cloud-based POS system is extremely easy to use. The software resides in the cloud, and the hardware is usually plug-and-play. Beyond setup, using the devices is also a breeze. Touchscreens and intuitive interfaces make it easy for employees to learn as well.
- Fast checkout. Whether you're selling online or in a store, speedy checkout is critical. Long lines lead to frustrated customers, and cumbersome online checkouts result in shopping-cart abandonment. A POS system can help prevent those scenarios because POS terminals tend to be faster than cash registers at processing payments and can accept several payment methods. If your business uses a mobile POS system, employees can ring up customers on the fly, and salesclerks can check stock and place orders for customers in seconds.
- Easy order management and inventory tracking. Cash flow is everything for a retailer. It dictates how much inventory you can order and how many promotions you can run. A POS system automates a lot of the inventory management processes across multiple stores. It can automatically alert you when inventory is being depleted. More advanced tools do the ordering for you and pinpoint sales trends. A POS system reduces excess inventory as well, tracking what sells and what doesn't.
- Expanded payment acceptance. To optimize sales, you should support your customers' preferred payment methods. For some, that's credit cards; for others, it's debit cards. Moreover, many customers now prefer contactless payments and digital wallets. Choose a POS system that supports all of these payment methods.
- Better sales insights. POS systems collect a lot of important data for you. They can tell you what items are selling out, which ones are doing poorly and what times of the day or week business is the best. POS systems can spot trends, reorder inventory and help you forecast, and they give you data in real time, enabling you to react quickly.
- Enhanced data security. It's incumbent on you to protect your customers' payment data. One breach can easily spell your business's demise. When you use a cloud-based POS system, you don't have to worry if your server is secure, because your data is stored securely in the cloud. All you have to do is set strong passwords and use two-factor authentication, when available.
Top POS features for retail POS systems
All POS systems are not created equal, but the good ones should have certain features. Here are some of the top features you should look for in a retail POS system:
1. Omnichannel management
Having both an in-store and online presence is vital for businesses to maximize sales and profits. Customers want to buy online and pick up in store, as well as check retailer websites to see if something is in stock before they go to a store.
To increase your online presence and grow your business, your POS system should offer an omnichannel experience and online sales management. These two features work hand in hand, as online sales management provides the option to effectively regulate e-commerce, while an omnichannel platform supports the sales of products everywhere your customers are – in your stores, at off-site locations, on desktop computers, on mobile devices and on social media.
2. Mobility
Mobile POS systems are becoming common in retail, and many customers are beginning to expect this option. Consumers hate waiting in line, and the mobility aspect reduces this problem. Stores such as Apple use mobile POS systems for their sales associates to check out customers anywhere on the sales floor, thus giving customers a more personalized experience and letting them skip the line.
Another option is for stores with traditional countertop checkout stations to add a mobile tablet to the system to use when the line gets too long. In some instances, mobile POS systems can be set up as self-service checkouts. Businesses that sell goods at farmers markets and trunk shows greatly benefit from mobile POS systems as well.
In response to the COVID-19 pandemic, a growing trend is self-serve kiosks that allow customers to scan their items and purchase them unassisted. These unattended transactions are made possible thanks to POS software with kiosk and mobile features, enabling merchants to transform tablets and smartphones into self-ordering and self-payment stations.
3. Inventory management
One of the best features of POS systems is the ability to track inventory in real time. By integrating business orders with online and in-store purchases, business owners can track their supply levels quickly and efficiently. By tracking inventory in real time, businesses can save money and avoid making mistakes when ordering from their suppliers.
The sooner you have products uploaded into your POS system, the quicker you can sell online and offline. Your POS system should let you upload your products all at once, which is known as bulk product imports. This way, you won't have to upload them manually, which is time-consuming if you sell several items.
4. Employee management
In addition to managing and monitoring the supply and finances of a business, some POS systems offer the ability to manage worker productivity.
Ann Motovidlak is a front-end supervisor for Gerrity's, a grocery store based in northeastern Pennsylvania. Gerrity's has nine locations in the area, and Motovidlak said managers use the RORCv6 POS system to track employees' work.
"Cashier productivity is a feature we like to use," she said. "We monitor our cashiers' sales, scans and items per minute, and voids. It also assists us in loss prevention."
Productivity tracking can be a valuable function in maintaining a secure and financially sound work environment. For many small businesses, managing employees and closely monitoring sales result in a more reliable and efficient workplace.
A number of POS systems also feature built-in time clocks, employee sales information and security management geared directly toward employees. Some systems even allow business owners to set permissions for different employees based on role, store or individual. By managing a worker's access to different areas of the business, owners can ensure that their operations run smoothly and safely while avoiding micromanagement.
Many POS systems offer support for multiple user accounts. Unless you're a sole proprietor, you should choose a POS system with this functionality. Depending on your level of service, some POS vendors offer unlimited accounts.
5. Reporting tools
Reporting tools are important for retail POS systems because retailers need to see not only their sales but also which products are their bestsellers (top margins) and worst sellers (low margins). Seeing hourly transactions and product movement will enable you to adjust your purchase orders accordingly.
Reporting tools also allow you to see the effectiveness of your promotions, your top salespeople and customers, and customer buying trends. You can identify what days, times and seasons are busy and slow, thus helping you optimize staffing levels. Many reporting tools let you apply different filters, like a time frame, so you can pinpoint exactly what you are looking for.
6. Credit card processing
Credit card processing is another essential feature to consider when choosing a POS system. You have the option of a POS system that is compatible with a processor or a POS system that offers in-house processing services.
The best POS systems are compatible with multiple credit card processors, or at least give you the option to compare rates and switch processors if needed. This is especially important if you have problems with a processor.
While some POS companies offer convenient, in-house processing services, these can be more expensive than POS systems that simply offer processor compatibility. This option can also be more challenging, since you have to replace both the POS system and the processor if you switch services.
Both types of systems are more convenient and accurate than having your credit card processing as a separate system, where you ring up the customer's purchases on the POS system and then manually enter the total on the credit card terminal. By ensuring that your retail POS system has credit card processing ability or compatibility, you will be able to successfully accept customer payments.
Most POS systems accept several payment methods, but some take it to the next level by enabling users to pay with gift cards and split the payment among different payment methods. The more flexibility you offer your customers, the better.
Returns happen even to the best retailers. How you handle them determines if you lose the customer. Choose a POS system that allows you to offer a customer-friendly refund-and-return policy that provides customers with different options.
7. Third-party software integrations
A POS system that integrates with other programs can add a customer management aspect to your business without requiring you to introduce a new production process to accommodate an additional program.
Integrating with third-party software can enable you to adopt new functions, such as recording customer information, maintaining loyalty programs and offering targeted promotions. Some POS systems have built-in customer relationship management (CRM) features, and some offer a series of readily integrated software.
Ben Adler, owner of Rebicycle in Montreal, said his business uses Lightspeed with third-party scheduling software called Booxi to create custom bikes. Lightspeed and Booxi integrate seamlessly, so Adler can record customer booking information without inputting it multiple times.
"When somebody makes an appointment on Booxi and they actually come in the store, I already have all their customer information, including their phone number, their email address and what service they're coming in for," he said. "I can automatically create a work order in Lightspeed with that customer information already populated, and so it's very easy for us to make a quote on the spot."
Another valuable integration involves loyalty programs. Repeat customers tend to be the most profitable ones. To keep them coming back, you have to offer more than sales and discounts. That's where loyalty programs come in: They give customers cash back every time they spend money with your business. Most POS systems offer a loyalty-program feature or integrate with a third-party solution, enabling you to create a rewards program.
8. Scalability
If you are opening a small retail business for the first time, you might not initially need all of the extra widgets and features available. However, as your retail business expands, it is essential to have a POS system that can expand with your business. This can be the difference between seamlessly upgrading your POS system to fit your new needs and having to move your information to a completely new platform.
Jean Iennaco, director of operations for Over the Top Cake Supplies in San Antonio, said her company now has multiple corporate stores and franchise locations. While she initially had no need for a POS system that supported multiple locations, that feature became critical as her company grew. Iennaco said her Revel POS system has been great for managing the expansion.
"We initially had another POS system, which wasn't compatible for multiple-location use, so we switched to Revel, which is compatible," Iennaco said. "We have four locations. I can be anywhere and help them out if there are issues. For example, I can check on locations by going into reporting and offering advice on ways to increase sales for the month. It's user-friendly and convenient for having multiple locations."
If Iennaco had used a scalable software such as Revel to start, she would not have had to go through the trouble of switching systems. This is just one example of how a system can be scalable.
Retail POS systems come with many features that can benefit your business. The key is to analyze your business's needs and prioritize the features that are most important to you before choosing a system. Regardless of which POS system you use, an omnichannel platform that can easily integrate with third-party software is a must. In addition to those features, reporting tools and inventory management go a long way in increasing productivity.
Additional reporting by Skye Schooley.