- A point-of-sale (POS) system is a combination of software and hardware that allows businesses to complete purchasing transactions, in addition to many other functions.
- The five major benefits of POS software are reporting, third-party integrations, employee management, inventory monitoring and customer management.
- Your company's size, industry, budget and feature needs will help you determine the best POS software for it.
A point-of-sale (POS) system is a combination of software and hardware that allows businesses to complete purchasing transactions. If your business sells goods or services, you will likely need a POS system to operate efficiently.
As technology evolves, so has the functionality of POS systems. In addition to payment processing, there are hundreds of POS software features available. Your business should choose a POS software solution that has features tailored to your specific industry and size. Learn about which POS system software features are available to make an educated choice for your business.
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What are the benefits of POS software?
The POS software that will be the most beneficial depends on the industry you're in, the size of your business, your budget and the features you need. Some point-of-sale software companies tier the features in each plan, so when you consider a plan, pay special attention to which benefits it includes.
Here's how five of the major feature categories of POS software can greatly impact your business.
- It streamlines and integrates with your other business systems. Finding POS software that easily integrates with your other business programs can simplify your operations. For example, connecting your POS system with your accounting software can automate sales and billing operations.
- It creates and tracks data reports. As a business owner, you should track and monitor your business data to see how your business is progressing and where you need to make changes. Cloud-based POS software allows you to track this data in real time.
- It monitors your inventory. The ability to automatically track and monitor inventory is a helpful feature for most small businesses, even those with very little inventory. Some POS software can track your inventory, calculate markdowns and notify you when supplies are low.
- It helps you manage your employees. Employee management features can be useful for setting functionality restrictions and permissions based on user profiles. Your POS system should also be able to track sales by individuals, which is a great way to set sales goals and monitor employee performance. This data can help you see where your team is excelling and what can be improved upon.
- It incorporates customer management and loyalty programs. If you need to collect customer information – like email addresses for mailing lists, physical addresses for delivery, or birthdays for annual rewards – a POS system that incorporates customer management features is key. Some systems can include loyalty programs as well, though it may cost extra.
What's the difference between POS software and hardware?
When you get a POS system, you will need both POS software and POS hardware. The main difference between these two items is that the POS hardware is the set of physical components you need to operate, whereas the POS software is the digital technology program you use to access information.
The POS software could be in the form of a web-based program or a local server-based program. Cloud-based software is the most popular option among small and midsize businesses, as it includes useful features like easy installation, affordability and online accessibility. Legacy server-based software, on the other hand, offers a stable connection, but it's typically only beneficial for very large enterprises, as it can be very expensive.
Point-of-sale hardware can be purchased or leased, though you should always buy your equipment, as POS leases are notoriously unfavorable to merchants. Mobile POS hardware has become the norm and typically includes a tablet, tablet stand, receipt printer, cash drawer, and card reader or credit card terminal. Depending on your needs and budget, you can incorporate additional pieces of hardware such as barcode scanners, caller ID devices, coin dispensers, customer display screens, digital menu boards, kiosks, kitchen display systems (KDS), kitchen printers, scales and tablet cases.
What is open-source point-of-sale software?
There are multiple variations of POS software when it comes to compatibility, with open-source software offering the most flexibility. For example, if a POS software program is listed as open-source on merchant processing, that means you can use it with the credit card processor of your choice.
Some POS system providers offer in-house processing or charge an extra fee (sometimes per transaction) if you want to work with a third-party processor. Some POS systems are compatible with a handful of processors, giving you a small pool to choose from.
Open-source (or processor-agnostic) POS systems are the best option, because you can switch processors (if the rates go up, the service is lousy, you find a better deal elsewhere, etc.) without changing your POS system as well. This flexibility is especially beneficial for small business owners, because switching POS systems is more expensive and time-intensive than switching processors.
What are some POS software options for PC?
Whether you are looking for a retail or restaurant POS option for your business, several POS systems are available for your device. Some POS software is both browser- and app-based and works with a variety of devices, like iPads and iPhones, Android phones and tablets, and PC or Mac computers. Others are limited in their connections or may only work with dedicated, proprietary POS terminals. If you are looking for POS software for a specific platform, make sure you read the terms or speak with a representative about the hardware and operating system requirements.
What is the best POS software for your industry?
Each industry has its own software requirements. For example, a large restaurant may need software that focuses on ingredient-level inventory management, menu and order management, and employee scheduling and tip management. A retail store may need software that focuses on inventory management with size and color matrices, customer relationship management features that track interactions and purchase histories, and a loyalty program. The best POS system for your business will depend on your industry requirements, budget and feature needs.
Best POS software for retail
If you're looking for POS software for your retail business, there are several factors to consider. You will likely need a system that has robust retail-centric features like inventory management for unique items and pricing, customer management for purchase histories and loyalty programs, reporting tools for sales data and performance, and third-party integrations. After researching several retail POS software companies, we determined that Vend is the best POS software for retail businesses.
Vend is compatible with multiple payment processors and third-party POS hardware, and it can scale with your retail business as you grow. The software offers affordable pricing with the option of month-to-month terms.
If you want to know more about why Vend is our choice as the best POS system for retailers, you can read our full review of this POS system.
Best POS software for restaurants
Operating a restaurant requires POS software with features designed with the food service industry in mind. The ability to manage food inventory, add nightly specials, send order tickets to the kitchen, monitor employee sales and tip out are just a few of the many features to look for in POS software. After researching several options, we determined that TouchBistro is the best POS software for restaurants.
The TouchBistro point-of-sale software can serve a variety of restaurant types, from small cafes to large establishments. The software is well suited for full- and quick-service restaurants, bars, breweries, and food trucks. It can be installed on one device or several, which is essential if you plan on expanding your business. In addition to TouchBistro's affordable rates, the software is compatible with third-party hardware, allowing business owners to use whichever equipment best suits their needs and wallet.
If you want to know more about why TouchBistro is our choice as the best POS system for restaurants, you can read our full review of this POS system.
Best POS software for salons
When you're choosing the best POS software for your salon, there are a few key elements to keep in mind. Your salon POS software will likely need to include inventory management to track nail and hair care products, integration with an online booking system to set up client appointments, and accounting software integration to monitor and track employee sales and tips. After researching several companies, we determined that Epos Now is the best POS software for salons.
Epos Now is a flexible POS system with a long list of versatile features. It has an online booking system add-on that can be very useful for busy salons with large clienteles. It offers affordable rates and month-to-month terms.
If you want to know more about why Epos Now is a great POS system for your small business, you can read our full review of this POS system.