It would be easy to disregard the importance of the role your POS, or Point Of Sale system, plays in your business. Because they tend to go hand in hand, many business owners regard their merchant processing and POS system as necessary evils, just some of the extra headaches you have to deal with when owning your own business. But it’s really so much more of an asset to the success of your business then it’s usually given credit for. Think about what your POS system does for you on a daily basis. It’s almost like your trusty technology based COO. It is your support system, your perfect compliment, the one you can’t live without.
Your POS is what actually allows you to operate and make your sales on a daily basis, it performs every payment transaction, then helps you to make sense of all those sales by generating sales reports and tracking inventory, streamlines and automates your bookkeeping and can even handle payroll. And if you have the right one, it can also be an asset to your marketing efforts and customer loyalty.
Your POS really can help you do almost everything.
Now that you realize just how important a POS system is to the success of your business you might be wondering how to weed through the multitude of options there are out there. You definitely will need to do your homework.Here’s a few tips on what to look for in a good POS and some common mistakes business owners make or overlook when choosing one for their company.
First of all, POS systems are not one size fits all. Just like every business is unique so are these systems and they are just not going to fit every business type. Some POS systems are actually created for specific business types. For example, there are systems that specialize in the restaurant industry, their systems are built around the unique needs of a dining establishment, if you are running a high end retail store those systems aren’t going to be any good for you. This is good because it helps you weed out the brands that just won’t work for your business so that you can focus your attention on the best contenders.
Create a wish list- check it twice.
You need to consider everything from the sale itself and the checkout process to inventory, tracking and handling product reorders, from sales and tax reports to customer management and marketing tools. First of all think about the processes you are currently doing… Is there anything missing? Is there a task you wish could be more streamlined? It’s important to take stock of what you already have and are already doing to help you know more about what you are looking for.
Functionality and ease of use-What functions do you need?
Now that you’ve made your list and you know a little bit more about what you need it’s time to find the right system. Armed with your list of “must haves”, and since you’ve already weeded out the options that just weren’t built for your business type, you should be able to narrow down the market to a few favorite contenders.
You’ll start by comparing each one’s features and functionality, nowadays there are a lot of tools built right into the software that allow you to perform all the tasks you used to have to use 3rd party solutions for. Things like customer management and marketing tools, or even a gift card program, are available right within the system and can be accessed right there in the same place where you are doing all of your other everyday business processes, like accounting tasks and inventory. You will also want to focus on how speed and user-friendliness go hand in hand with its functionality.
Next consider your hardware needs to compliment your POS.
What kind of other hardware do you use to facilitate everyday business? Do you have multiple locations? Do you use a barcode scanner for inventory, cash drawers, receipt printers or any other hardware outside of the point-of-sale? The main question here is: Are these going to be compatible with your new POS system and easily integrated?
Make a list of all the items you need to function, whether you have one location or many. If you would like to keep some of the hardware you are already working with make sure that you have all of the names, model number and/or serial numbers handy to make sure the POS system will integrate with the components. The last thing you need is to get all set up and ready to go just to find out you have spend more money and order some new hardware just because yours doesn’t work with the new system.
Cloud based POS or ON-Premise, which is best?
Consider whether you want a cloud based solution (or what they call an on-premise one time license solution). If you decide you don’t, stop and consider again. There are many benefits to a cloud based solution, not in the least that they will save you money and time, both very valuable commodities when you are running your own business. Cloud based software allows you the flexibility of access from anywhere in the world. You are no longer tethered to the office computer to run reports and perform functions. You can do business from wherever is most convenient for you, even if that means out in the field. Cloud based software is an ever morphing thing and since we live in an age of constant technological advancement it is imperative that your system can change and morph with the times. Cloud based solutions will have a monthly fee for use but that includes all updates to fix bugs automatically as well as improvement updates and will generally integrate with most 3rd party software. They are also much more scalable. As your business changes or grows they can change with you. Need to upgrade? Maybe it’s time to downgrade, or maybe you just need to cancel, with how flexible these systems are you can do any of these things at any time.
If you need to make any changes to the equipment it will often require that you have a technician out for an additional, and sometimes substantial, fee to allow for the integration. While an on-premise POS often means a long term contract for you in addition to generally not being as flexible as time moves on as a cloud based solution.
But, again these are all things that need to be thought through depending on your type of business.
Take it for a test drive!
There is nothing better than getting a hands-on feel to help you tell if you’re going to like something.
First hand experience is just so much better than being told how great something is. Slipping your arm through the sleeve of that beautiful Angora sweater, feeling the most incredible softness caress your skin, cuddling into it’s warm coziness as you pull the sweater up around your neck and looking in the mirror and seeing how that pale pink perfectly compliments your skin–there’s just nothing better. Picking out a POS system may not make you feel as warm and fuzzy as a new sweater, but trying it on for size, so to speak, will help you visualize how you’re going to feel about using it every day.
Another important point to take note of when considering how something is going to make you feel is examining how your business will transition to your new POS system. Make sure the implementation team fully explains how the process of transferring customer data, inventory, suppliers and everything else will work. Make sure to set aside the time needed for you and your employees to learn the system and feel comfortable with it. Obviously, when this goes as smooth as possible the better you are going to feel about your purchase.
Common pitfalls when purchasing a POS system.
Making a rash decision. I’m sure you can tell by all the points made above that going with the first one someone tries to sell you or just the newest one being touted on the market is a pretty bad decision. There’s too much at stake to NOT do your due diligence!
Not considering the potential growth of your business. Don’t assume your business is going to look and operate exactly the same a few years from now as it does right now. Hopefully, you plan on staying relevant in the marketplace. Again, having a system that has the potential to grow with you, easily upgrades to your needs, includes ongoing training is going to be an asset to your business and help you realize ROI.
Looking at your vendor as a one time sales person. It’s time to create a relationship with your POS vendor. They are there to support you and not just with technical support. Utilize the resources they offer to help you make the most of your POS system. Many companies offer ongoing training classes and other resources that are often free. All those fancy features aren’t doing you any good if you aren’t utilizing them and your system becomes infinitely more costly if it’s not being used to it’s full potential.
Not having a back up plan. POS systems go down, the internet goes down. Mother nature has a way of creating a disaster at the most inopportune time. Many newer POS systems these days have WiFi capabilities, even if they are wired in for everyday use. In the event that your internet goes down you would be able to create a personal “hotspot” to connect to allowing you to continue business until internet comes back up. They also should have the ability to operate offline, storing the transaction information in the queue until such time that the system is back up and online. But you should consider having at least one more back up plan.
You may also want to consider getting a back up phone line based terminal. Even if the POS crashes the most important thing is to still be able to make sales through the crisis. A phone line based terminal would allow you to continue to accept credit cards until the system is back in operation. And lastly, you should always have a “knucklebuster”- a manual credit card impression machine. If all else fails you can make your sales and lessen the inconvenience to your customers by making a carbon copy imprint of the card. The problem with this back up plan though is that many credit cards are no longer embossed with the number on the front. Credit card issuers are now laser imprinting the number on the front, or back, of the card which would not allow for any kind of imprint to be made. Trust is a factor here, many consumers do not feel like this is a very safe way to handle their credit card details.
Sometimes purchasing a new POS system also means you are getting a new credit card processor with a long term contract along with the package. Getting pigeon holed into having to use their preferred processor and all the problems that go with it can be a headache for the business owner. We’ve seen this situation happen many times: Maybe the rates sound great now but a year from now the rates just keep going up, you’re mad at customer service because they are never there, etc. You can’t shop around, you are contracted to use their processing. They will tell you that your POS won’t integrate with any one else’s processing. Or, if they do let you go with your own processor it will cost upwards of a couple thousand dollars to make it happen. The last thing you want to do is have to purchase another whole new POS system, so again, make sure you are looking towards the future when you make such a big purchase.
You may feel like you’re between a rock and hard place and you don’t have a choice if a particular POS seems like the perfect system, but you always have a choice. Remember there is no one-size-fits-all when it comes to choosing a system and that includes your merchant account service. You may have to sacrifice one feature or another to make sure you are happy with your merchant service provider and your rates. Remember, this part of your business is also long term and enduring, obviously we believe it’s important to work with a processor who is educated and trustworthy, or we wouldn’t have dedicated an entire article to it. This is also an important partnership that is meant to be long term, when you choose the right merchant service provider they will be there to support you and do whatever they can to ensure your success.
When it comes to security and compliance Not all are created equal.
I’m sure by now you know how important it is to have moved to the EMV compliant chip cards, but did you know that Not all POS systems are EMV compliant? This is surely something to think about and raises some questions you will want to ask: When do they plan to become completely compatible? Will the update to your system be free? Moreover, some POS installers and resellers are not QIR certified and do not keep up with security standards. When doing research into data breaches and security issues Visa found that 93% of payment data breaches occurred because of “Insecure POS implementation and servicing by integrators and resellers.” You can’t allow a 3rd party installer to put your business or your customers at risk. Make sure to ask questions and only use a POS reseller and installer that is QIR certified.
At the end of the day the most important thing is to do your due diligence. Take the time to compare the options out there once you have narrowed it down to a few favorites. Talk to your peers in business to get real life feedback on the systems they are using, find out what they love, and hate. Add those things to your list of “must-haves”. Read the reviews of each product. When you realize your POS system is really your bestie, the Scarlett to your Rhett, your partner in crime…er business, you realize what a big deal it is to find the perfect one. It will take some time and effort on your part to make the right decision but it will pay off tenfold in the long run when you have a lasting and loving relationship.