The significance of POS system to Automate Sales & Increase Productivity

POS system
Written by Savaram Ravindra

The point of sale (POS System) is the place where your customer executes the payment for goods or services bought from your company. POS systems are simple yet highly efficient technologies that transformed various industries. A high-tech, robust POS solution can affect your work environment positively in many ways and bring innovation to your business. A great POS system will save you lot of money, increase your revenues substantially and save a lot of time for your employees and customers.

The latest POS systems with a lot of features can help you gather data you can analyze later to optimize your business, enhance your marketing strategies, and develop healthy relations with your customers.

Points of Sale and Buying Behavior

The POS for products and services is an important focus for marketers because consumers tend to make purchasing decisions on high-margin products or services at these strategic locations. Traditionally, businesses set up POS near store exits to increase the rate of impulse purchases as customers leave. However, varying POS locations can give retailers more opportunities to micro-market specific product categories and influence consumers at earlier points in the sales funnel.

For example, department stores often have POSs for individual product groups, such as appliances, electronics and apparel. The designated staff can actively promote products and guide consumers through purchase decisions rather than simply processing transactions. Similarly, the format of a POS can affect profit or buying behavior, as this gives consumers flexible options for making a purchase. For instance, brick-and-mortar stores that use mobile devices or terminals as POSs can improve checkout efficiency and customer service.

Components of a POS System

There are two common software deployment methods:

POS Software Components

On-premise: A traditional software model. Purchase one or more licenses upfront for the software and install it on your computer system or servers. You’re in charge of updating and maintaining the software, which may require dedicated IT personnel for larger organizations.

Cloud-based: Also known as Software-as-a-Service (SaaS) POS system. You access and support the system via the internet. If your internet goes down, most systems track sales and sync them once you’re back online.

POS Hardware Components

Regardless of your chosen software deployment method, the hardware is the same. The following hardware components are crucial for supporting POS software:

Register Screen: A standard monitor that displays the product database. Enables other functions, such as employee clock-in and viewing sales reports. Tablets—especially iPads—are popular for replacing bulkier monitors.

Barcode Scanner: POS Systems allows the advantage of management of inventory. Automates the checkout process. Scanning barcodes pull product info and adds it to the checkout total. Barcodes, when scanned, may also integrate with inventory management systems to automatically adjust stock levels.

Credit card Reader: Secure and EMV-compliant credit card readers are extremely important for retailers since the EMV payment standard went live in 2015, and non-compliant retailers face potentially huge losses on account of fraud liability.

Receipt Printer: Email and text receipts are gaining popularity, but paper receipts are still important for providing customers with a quick snapshot of their purchase. You can print employee sales totals, hours and other information.

Cash Drawer: It may fade away in the years to come, but cash is still king. And as long as it is, you need a secure place to store cash for transactions. Additionally, there are no credit card fees tied to accepting cash.

Retailers benefit greatly from the automation and organization POS hardware and software systems provide. However, it’s also important to understand how these components work together to help you overcome certain pain points.

Benefits of POS Systems

An electronic POS system streamlines retail operations by automating the transaction process and tracking important sales data. A basic system includes an electronic cash register and software to coordinate data collected from daily purchases. Retailers can increase functionality by installing a network of data-capture devices, including card readers and barcode scanners.

Depending on the software features, retailers can track pricing accuracy, inventory changes, gross revenue and sales patterns. Using integrated technology to track data helps retailers catch discrepancies in pricing or cash flow that could lead to profit loss or interrupt sales. POS system that monitor inventory and buying trends can help retailers avoid customer service issues, such as out-of-stock sales, tailor purchasing and marketing to consumer behavior.

How can a Good POS Technology Save Money for You?

Choosing the right point of sale system is a daunting task for any business, especially when it is necessary to choose and configure separate components. An all-in-one POS system is a complete package that is tailored to the needs of a particular business and by default comes up with necessary components that include a cash drawer, barcode scanner, keyboard, label printer, pole display and a magnetic stripe reader. An all-in-one POS system takes the guesswork out of configuring the system, and can also save money.

Let us know the four primary ways in which a good POS technology can save a lot of money for you.

Analyzing business data

To manage a business effectively, you must be well-aware of its strengths and weaknesses. For this, you must have access to the data that is reliable like facts, statistics and number, instead of just depending on your instincts such as many old-school shopkeepers still do. Gathering data can be a time-taking process that may require a considerable effort, and sorting by hand through all these numbers is nearly easy.

One of the ideal features of a modern POS technology is the accumulation of all of your business data such as:-

  • Discounts,
  • Items sold,
  • Food and labor costs,
  • Number of customers, and
  • Sales by the hour and type.

They provide you with access to the highly popular “Big Data” enabling you to understand about your numbers using a practical approach. A POS system provides reports that streamline the sorting process through taxes and expenses, plan your future deals, promotions and define your marketing strategies. According to few well-defined KPIs (Key Performance Indicators), getting to know how well you performed will get you a step closer towards reaching your goal.

Check Sales By Hour

Periodically checking your sales by hour can be one of the easiest ways to save the business money. The important thing here is to remember that just because a day is profitable, doesn’t mean all hours of the day were. Recognize that your slower hours of the day — specifically the first and last few — instead of making you money, might actually be costing you money.

Examine these hours, taking into account staff payroll and how much it costs to keep the lights on. Then, look at your sales for that time period. Are you making money? And if so, how much? If you’re not making any money, or only dollars more than your overhead, it might make sense to close your store early, or open later. You’ll not only save money but can allocate that time to business (or personal) tasks you’ve been meaning to tackle.

Enhancing Customer Experience

It is not easy to argue that the clients who are happy can make successful businesses, particularly when you run a coffee shop or a brewery which are quick ticket businesses. With the specifically designed features, some POS solutions can improve your customer experience substantially. These features can also enhance their engagement. Imagine your restaurant guests can make their reservations online, view their order status in real time, and enjoy their waiting by watching some food pictures.

The delightful menus that can be customized as required may attract the Patrons in cafeterias. They can display your convenient next-week-only promotion, an enthralling upsell or your amazing food that may convince the customers to come back again.

If POS is integrated with tablets and iPads, servers can take orders from customers on the spot, thereby reducing waiting time and mistakes, turning more tables and enhancing the service quality. The better your customer experience and the faster your service, the more likely a customer is going to come back again. Gift cards and loyalty programs can be programmed easily with a few clicks, and they provide you a simple method to tightening your bond with your guests and increasing your brand exposure.

Ease of use

All-in-one POS systems are also much easier to use since each component is part of the same technology and software is better integrated. This means employees will spend less time with the machine, which equates to fewer and more efficient business hours. The ease of use of all-in-one POS systems also translates to shorter wait times for customers, which could drive increased sales. Finally, since every component is integrated, employers find they are able to train staff on the technology much more quickly.

Making your Business More Effective

You can save a lot of money by enhancing operational efficiency and you can smoothly run your daily operations in many different ways by having an advanced POS technology. Here are 2 instances of how a POS  system can help you in running an eatery.

Order efficiency and speed – a traditional order system needs your server to write down the order after talking to the customers by going their tables. Replacing this traditional order, a guest can send an automated order through online or by clicking on a table menu instead of through phone, cutting down the time to just a few seconds. The higher success rates can be achieved on the orders if the tickets are easier to read. The more orders you can receive and process accurately, the more amount of money you can make.

Order Accuracy – the workload can become hectic if you have a large group of customers. Due to this, mistakes are bound to happen as in these kinds of situations, the cooks must prepare dishes quickly and servers must run back and forth. You are saving more than $200 per month, if you avoid one mistake per day and if this error costs you $7.

Less expensive maintenance

Working with separate vendors to customize your POS system can be costly, especially when the system requires maintenance. For example, if you are having difficulty with your card reader, there is the likelihood the vendor could blame the issues on a different component of the POS. As a result, small businesses can spend excess time and money solving a simple technical problem, which costs them sales and customers. With an all-in-one POS, one company is typically responsible for maintaining your technology, and technical issues are easier to address since everything is integrated.

Save Environment and Money by Going Green with Technology

Saving cash and going green have a direct relationship. Putting money in technology that is environmentally sound is wonderful not only for the business but also the environment. These technologies are highly efficient in enhancing the daily operations’ productivity and they will help in saving a large amount of money. The easy and simple ways of cutting cost are provided by POS technologies to many businesses, especially like restaurants. During the day-to-day operations of a restaurant, a lot of paper is wasted. By adopting a restaurant POS system, you can eliminate paper waste and paper costs. 

A transaction can be completed from a credit card and the receipt is sent to the customer through email by the signature capture pads. It is efficient and doesn’t need any paper. You must invest in rechargeable gift cards if you are offering gift cards to the clients. They can be utilized again and again by reloading. The trouble with printing new ones can be avoided in this regard. POS systems are most effective when combined with kitchen display systems. The cost of kitchen receipts can be saved if you can use the kitchen display system (KDS). Without decreasing the service quality that you are offering, these techniques are ideal for saving money.

Best POS system for Small Business in 2018

  • Erply
  • Shopify POS
  • Toast POS
  • TouchBistro
  • Square POS
  • Salesforce Commerce Cloud
  • FastSpring
  • Shopify POS
  • QuickBooks POS

Final thoughts

Choosing the appropriate POS system for your online or retail store can save a lot of money for you, probably much more than you can imagine. Though most of these solutions need an upfront expense, they are highly economical in the long run. As we quickly progress towards an era of digitalization, having the appropriate “tools of the trade” incorporates having the highly reliable and advanced POS tech as well. In order to succeed in this competitive world, POS system will provide you with the edge you need.

About the author

Savaram Ravindra

Savaram Ravindra was born and raised in Hyderabad, popularly known as the ‘City of Pearls’. He is presently working as a Content Contributor at His previous professional experience includes Programmer Analyst at Cognizant Technology Solutions. He holds a Masters degree in Nanotechnology from VIT University. He can be contacted at Connect with him also on LinkedIn and Twitter.


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