How POS Systems Have Evolved to Benefit Businesses in More Ways

How POS systems have evolved over time

Any business-to-consumer (B2C) company can benefit from using a POS system. That’s long been the case. But, where these systems were once dedicated solely to POS transactions, they’re now capable of much more. Businesses can use mobile POS systems to process transactions on the go. Also, they can take advantage of integrations with other business software to share data organization-wide — getting more done with less effort.

“Mobile systems … both augment and replace traditional POS systems,” said Rick Caldarella, former vice president of product management at Vanco Payment Solutions. “[But] POS systems will continue to stick around because they still serve a critical purpose for merchants.”

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Newer POS systems have also shown progress through increased security measures, especially in mobile POS systems. It’s necessary to stay up to date with infrastructure that can protect your company and its customers’ private information.

“Security and liability concerns are critical to the types of businesses who utilize POS systems to run their shops,” Caldarella said.

How modern POS systems benefit businesses

When you implement a POS system today, you can expect it to affect not just the POS transaction but each of the following areas of your business for the better.

Inventory management

Today’s POS systems automate inventory management; they automatically deduct a SKU from your inventory when a sale is made so you know exactly what you have in stock at all times. You can also use a POS system’s tools to automate reordering — generating purchase orders to send to suppliers when certain SKUs reach low levels. You can adjust these levels using reporting data that shows historic sales trends; the very best platforms can do this automatically. If you prefer to handle reordering manually as part of your workflow, most systems allow you to simply set up alerts about low quantities of an in-stock item.

Marketing and advertising

POS data can be used for advertising and marketing purposes. Sales data can help businesses target audiences and create personalized promotions, especially for hot selling items. You can also use POS data to develop targeted email drip campaigns. These notifications let customers know when their favorite items are in stock or on sale to encourage them to come in.

Some POS systems have built-in marketing tools, such as loyalty program set up and management. This can make it easy for even the smallest of businesses to run sophisticated customer loyalty programs. [Related: 3 Ways to Offer a Customer Loyalty Program]

Payroll

POS systems can make the payroll process easier for business owners — they can share data about which employees were logged into the system for which shifts. Thanks to these features, you can track your employees’ hours, create schedules and log requested time off for each employee through a POS system.

These types of integrations between business software reduce the need for double data entry. This, in turn, decreases the risk of human error leading to inaccuracies and inconsistencies which cause confusion and problems down the line. By leveraging your POS system data to inform payroll processing, you can reduce the time it takes to prepare payroll records. Plus, you can ensure everything is accurate without manually cross-referencing data.

Customer service

The best POS systems can share detailed customer information with your CRM system directly. So, if a customer makes a particular purchase, your customer service team will be able to review it with ease. If a customer calls in with questions, the customer service team will be able to access their recent purchase data. It is also useful for sales personnel who want to cross-sell or upsell when talking to specific customers; if they know what the customer has previously purchased, they’ll have a better sense of their current needs too.

Reporting and metrics

POS system reports contain a wide range of useful data. Chief among them: historical sales trends that can be used to project future expectations. This data can also be used to support the accounting team by automating the recording of revenue from sales and calculating sales tax liabilities.

For retail stores, a POS system can track the average transaction value, gross margins, sales per employee and items per purchase. The best POS systems for restaurants can track metrics such as labor and food costs, average check amount, and how many guests are serviced in any interval.

How payment versatility enhances the customer experience

Modern POS systems have multiple ways to accept payment from consumers. Different payment options save time for both businesses and consumers while increasing sales due to flexibility. There’s no need to look at traditional POS systems and mobile credit card processors as mutually exclusive. Businesses can combine the two methods to provide better service and enhance customer satisfaction.

Payment strategies to save time

Businesses and customers can save time using different ways to purchase items. Customers prefer a quick checkout process and are less likely to visit a business with a slow payment system. A POS system can offer your customers these options:

• Checking out on the sales floor instead of at the register
• Buying products online and then picking them up in the store
• Buying products online and having the store ship their purchases directly to their homes
• Using self-service kiosks to place orders, pay bills or tabs, or check in and out
• Making contactless payments via near-field communication

As long as your POS system has the right safety measures in place, you can save customers’ payment methods for speedy checkout. This is especially convenient for frequent customers.

“With data security becoming an increasing concern, it is critical to deliver the safest way for your customers to pay in order to protect both you and them,” said Jared Isaacman, CEO of POS systems provider Shift 4 Payments.

Supplementing vs. replacing your POS system

Upgrading your POS system doesn’t necessarily mean replacing it. The familiarity and security of a traditional POS system combined with the perks of a mobile POS system could be all your business needs.

“The key for retailers here is to supplement the experience, not supplant [it] with technology,” said Michael Ni, CMO of marketing and product strategy at Openprise. “For instance, Apple and Walmart offer a ‘buy online, pick it up in store’ option, where consumers can use mobile devices to order items and then physically pay for them using a traditional POS system at the store.” [Read related article: 5 Reasons You Need a Mobile POS System for Your Restaurant]

Embracing the power of POS systems

As POS systems continue to evolve, they remain an indispensable asset for small businesses. The integration of traditional hardware with modern mobile capabilities results in a powerful, flexible tool that adapts to changing business needs. By embracing these advancements, you can streamline your operations and improve customer satisfaction — thanks to the reliability, security and versatility of today’s POS systems.

Brandi Calero-Holmes contributed to this article. Source interviews were conducted for a previous version of this article.