The Point of POS

Point-of-Sale systems can improve customer service and result in faster payments for retailers.

In a world where gargantuan retailers frequently undercut small and mid-sized retailers, the information offered by a Point-of-Sale (POS) system helps independent retailers compete by managing their businesses more efficiently and delivering exceptional customer service. According to a June 2004 study by the Boston, Massachusetts, research firm Aberdeen Group, “Allowing their POS systems to keep track of inventory-, customer-, and cashier-related information frees small business owners to focus on their key differentiator in the post-Wal-Mart world: personalized service and attention to customers’ needs.” Customer service can be as simple as offering a sale on seasonal products during the holiday run-up or as complex as knowing and stocking the favorite designer labels of high-end customers.


But today’s retail customer has numerous ways to shop–in the store, online, over the phone–and your POS system needs to extend beyond your store. You must gather and track online and catalog purchases and tie it back into your inventory and accounting systems. A POS system can accelerate your ability to react immediately to retail product movement anywhere in your supply chain. For instance, if you have a big day and sell out of a certain product in your store, your POS system– which is tracking all the sales– can be configured to notify your warehouse and stock can be automatically shipped.

Point-of-Sale systems help improve your ordering, too. As a successful independent retailer, you likely have an intuitive sense of what sells, but don’t know how much to order. But by extracting the data in your POS system and analyzing past sales of the same or similar merchandise, you can discover customer buying patterns that may not be obvious. Armed with this information, you can improve ordering and merchandise turnover, while avoiding over- or under-stock problems. And the information stored in the POS database can allow you to pinpoint your most profitable customers and stock the items you know they want.

Before you assume that you can’t afford a POS system and stop reading, you should know that POS systems run the gamut in price and features. There are less expensive systems that effectively add a cash drawer to your PC and help you track inventory and download sales information to your accounting software with a single click. In addition, you can also find sophisticated systems that use a server and are connected to POS systems in the front of your store. In addition to aiding in the checkout line, these high-end systems can digitally scan checks, image ID and credit cards, print receipts quickly and reliably, and capture a full range of customer and inventory data. The possibilities are endless.

The main challenge faced by retailers when purchasing a POS system is looking beyond short-term acquisition cost and instead looking at the Total Cost of Ownership (TCO). After all, these systems help closely manage inventory, increase customer service levels, and aid in cash management, so you know a POS system will pay for itself over time. Point-of-Sale systems are especially helpful to retailers that:

  • Stock large quantities of the same item and order from a fairly consistent supplier base.
  • Want closer relationships with their customers and use the POS system to capture customer information.
  • Use seasonal or part-time employees to staff their stores.

Mobile Point-of-Sale

Point-of-Sale systems are not just tied to a checkout stand. With Wi-Fi and cellular technology, POS systems now reach to anywhere customers are. If you’ve rented a car lately, you know that when you return the vehicle to the lot, rental employees can swipe your payment card right there and print a receipt, often using nothing more than an ordinary cell phone with a card swipe attachment or a handheld device with a built-in swipe slot.

Mobile POS systems are not new. But as wireless networks have improved and device prices have decreased, the technology has started to look like an attractive alternative to fixed, dial-up POS payment systems. And it extends POS benefits to even the smallest independent retailer: the coffee cart vendor, the hot dog stand, the mobile food vending vehicles.


For consumers, the ease of using a card anytime, anywhere means that they’ll spend more money. In fact, industry figures indicate that consumers spend up to 15% more when they can use a card. The convenience factor– in terms of when payment is received– and the ability to use POS anywhere means smaller retailers can often compete in more arenas than the mega-retailers.

The Point of POS

From the back office to the sales floor, a POS system can provide your store with the tools it needs to efficiently provide the best customer service. With a POS system you can:

  • Integrate your POS system with other business systems to give you instant business intelligence, helping you to plan product offerings and manage your supply chain.
  • Increase market presence through mobile POS.
  • Increase sales through impulse buying on cards.

Point-of-Sale systems also make it easier to stock what you know people will buy and easier for them to buy what they want. Point-of-Sale pays off, and that’s the point.