Retail is one of the fastest-growing industries in the world. To put this into perspective, there are about one million retail businesses in the US which account for 18% of the national GDP. Even though retail stores received a massive blow after the Covid pandemic struck the world, the industry is slowly picking up the pace. That said, running and managing the day-to-day operations in a retail store can be easier said than done. You need to stay on top of your inventory to ensure you don’t run out of essential products and push potential clients away. You also need to confirm your customers have an easy time checking out at the cashiers and more.
This is where a reliable Point of Sale(POS) system might address some of these problems helping you run your retail business with ease. Yes, you are more likely to retain customers and generate more income by investing in a good POS. Let’s explore more on the essence of investing in a reliable POS system for your retail business.
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For starters, a point-of-sale system (POS), also known as a point-of-purchase, refers to hardware or software that enables your business to accept payment from your clients. The old-fashioned cash registers were more or less the traditional forms of POS. These cash registers did not know the price of the products, and the cashier had to check the price tag and manually key in the price before calculating the total amount.
These days, there are computerized POS systems that can read barcodes, thus eliminating the need to check and manually insert the price tags. We now have a POS system that allows employees to accept payment and check out a client from wherever they are in the store. These modern systems also have additional features aside from accepting payments that help employees clock in and out, manage inventory and generate reports.
A point-of-sale system is not a machine or single process but a combination of moving parts working harmoniously to streamline business operations and process payments fast and accurately. Critical components of a modern POS include the software and hardware. POS software is the component that registers, processes, and stores transactional data when a client purchases products in your retail store. On the other hand, hardware is what your business uses to run POS software. Now, there are key POS hardware and software that work hand in to streamline payment processing for retail.
Types of POS hardware
The type of hardware components you choose for your retail store will depend on your needs. Some of the most crucial hardware components include:
- Receipt printer
- Card machine to process credit or debit cards
- Cash drawer to store float and cash payments
- Cash register to register transactional details
- Barcode scanner
- Internet router
The software components are categorized into frontend and backend interfaces. The front end is responsible for processing transactions while the back end handles management functions and behind-the-scenes analytics. You can install the software on a computer located on-site or opt for a cloud-based solution, meaning you can access it from any computer with internet access. You don’t require an Internet connection with on-site software; your data is stored within the store’s premises.
However, this software will cost a bit more to set up, and you will need to purchase several licenses and hire a professional to help with maintenance. On the other hand, cloud-based options are cheaper, integrate better with other software programs, and are easy to access from any computer. That said, you cannot operate cloud-based POS without an Internet connection at your retail store.
Benefits of investing in a reliable POS system
Now that you understand what a POS system is and how it works, let’s dive into some benefits of POS to your retail business.
Improved customer experience
At its core, a retail store is customer-centric and should seek to give its customers the best experience. One excellent thing about a POS system is that it benefits you and the customers who promote your business. A fast POS system reduces waiting time at the retail store and allows clients to make the transaction faster at the cashier.
This system also offers cross-selling features by offering clients products that work well together or are related. Another excellent way a POS system improves the customer experience is by integrating an e-commerce platform, where customers can shop online from the comfort of their homes without visiting the physical store.
Your employees are the backbone of your retail store as they are responsible for interacting with customers, conducting sales and promotions, and ensuring all business operations are running smoothly. However, managers have a hard time quantifying the performance of their employees without any actual data to refer to.
A good POS system allows you to assess each employee’s strengths and capabilities depending on their output in the workplace. The data you collect can then help you formulate the best schedule for your employees and provide training where necessary.
Ability to make payments faster
We are all familiar with the long queues at the cashier’s as you wait to pay for the products you chose. A POS system can significantly reduce the customer’s waiting time so they won’t have to stand in line longer than they have to. This system will automatically calculate the total price the customer has to pay, leaving no room for errors. Customers can also choose their mode of payment, be it cash, credit card, or debit card, and pay the invoice in a timely fashion.
Secures your data
Data in this technological era is as precious as money in a cashier’s register. We cannot stress the importance of keeping your data safe from hackers and scammers. Investing in a POS system assures you that your data is safe from outsiders. The double user authentication allows admins to track and block intruders who try to infiltrate the system and verify the identity of authorized users.
That said, natural disasters such as floods or fires could destroy your hardware, and the data within could get lost forever. Therefore, it would be wise to opt for a cloud-based point of sale for easy retrieval and improved security from eventualities.
Save time and money
Repetitive tasks such as ordering, inventory management, creation of reports, and promotion management are time-consuming and place a heavy workload on your staff. Your employees could be stuck doing one task for a whole day and neglect other crucial functions such as improving the customer experience at the retail store.
A POS system automates mundane and repetitive tasks, causing your employees to be more efficient at the workplace. Automating various tasks reduces business operations and operational costs and saves you some precious extra bucks.
Improved inventory management
Manual inventory tracking can be tedious and leaves room for numerous errors. POS takes the load off your shoulders by automating inventory management and tracking your inventory in real-time.
All you need to do is scan your items and enter the quantities of the remaining pieces. When a customer purchases items in your store, the software will automatically deduct the sold items from your inventory to determine which products you need to restock before you run out.
Boosts customer loyalty
We live in a world where clients expect speedy services and deliveries. If you cannot meet the client’s expectations, you will not succeed in business. A POS system helps you exceed your customer’s expectations by providing fast and efficient services and increasing convenience.
This system will also aid in customer retention as sustaining your existing customers is much more complicated than gaining new ones. Satisfied customers will always keep returning for more, meaning you are less likely to lose money.
Supply order and purchasing management
Every retail store requires specific equipment to streamline business operations. Before you purchase any equipment, it would be wise to determine the type of equipment you need for your store and find reliable suppliers with high-quality products.
A POS system can get the job done and help with the process of brainstorming the minimum amount of equipment your store needs to thrive. Once you know what you need, you can use the POS system to track your orders.
As we mentioned earlier, a POS system boosts customer retention and satisfaction. Returning customers provide a steady stream of income for your retail store. You could also create additional income streams by offering functionalities such as online shopping, cross-selling, and consignments.
In a nutshell, POS systems offer numerous benefits for retail stores and small businesses that intend to grow in the current competitive market. Since each POS system is different from the next, choosing a package that best suits your retail business would suffice For instance, if you own a restaurant, it would be best to select a POS to manage menus and book reservations. Other good features of a sound POS system include integrating with your business or e-commerce website. The bottom line is that you should take your time to assess the features and the pricing aspects before buying a POS for your retail business.