POS systems. You may have heard it in passing. You may even say the term yourself, without fully knowing what you’re talking about (hey, we all do it).
When asked “what is POS?” most people will confuse it with payment processors. Some may even confuse it with a cash drawer. It’s fair enough – those things can be part of your POS. But a payment processor is not a POS, and neither is a cash drawer. So… what is POS?
POS stands for Point of Sale. If you look it up on Google the definition from Wikipedia may appear, citing point of sale as “the time and place where a retail transaction is completed.” Basic, but more or less true. You may imagine those old-fashioned point of sale terminals from the fast food restaurants of your childhood, the ding and clash of the cash register opening and closing, the screech of the receipt being printed. You know what I’m talking about.
And while that is correct in some sense, it’s not necessarily true anymore. Just like how this image of a phone, while technically accurate, isn’t really an accurate representation of a phone today.
So I’ll get to the point.
At its most basic, a point of sale is the point where the transaction is processed. Typically, your product inventory is programmed in your POS so you can select or scan the products your customer is buying. Your point of sale will tell you the total owed, including a breakdown of the numbers (like taxes), you’ll select a payment method, and once your customer has paid, you can close the sale in your POS. A smart POS, which most are in 2020, will know to adjust the inventory accordingly after every purchase, and will add the information (like revenue, taxes, etc) to your POS reports.
Pretty basic, right? Anyone who’s worked in any kind of retail or service will have experience with a POS, even if you didn’t know it was called a point of sale.
But a POS can be so much more than just a place to complete a transaction. Just like the evolution of the telephone, the POS has evolved into something else entirely.
In fact, a POS can be the entire operating system for your business, just like how in some ways your phone is the operating system of your life. (Was that deep, or what?)
POS systems do more than just process sales.
So, a Point of Sale can be understood by breaking it down to its basic parts and features.
For example, the register. The register is where your process your transactions. It’s where you scan or select your shop’s product and select the payment method and complete the sale and all that basic stuff.
Payment Processors are the devices you use to take payments, such as card readers. Some POS systems come with a payment processor already built in, and some allow for third-party payment processors.
A POS can also provide all kinds of shop management tools and features that help run your business.
For example, inventory management. Inventory management tools help you keep track of the products you have in stock, so it’s easier to stay on top of your stock levels, purchase orders, and sales.
Cash management allows you to count the money in your cash drawer before opening and after closing, keeps track of the cash flow coming into your business, so that you can keep track of your cash and prevent losses.
Customer management. With some POS systems, you can actually keep profiles of your customers to keep track of your returning shoppers and what they purchase. With the rising expectation of personalization in retail, it’s becoming more and more important to personalize the shopping experience by keeping track of your customers.
Staff management. Your POS can help you manage your staff, too. Some POS systems offer schedulers or rosers, and some have sales goals and staff reports to keep track of your staff’s performance.
Integrations. Probably the neatest thing about the modern POS is integrations. Not all POS systems are equipped to integrate, but the best one sure are. Going back to the phone analogy, apps are an essential part of your everyday life. We all use apps to communicate with our friends and family, to set our morning alarms, even to manage our banking accounts. Well, your POS can be like that for your shop. Integrations can include marketing tools like Mailchimp, accounting tools like Quickbooks, and so much more.
Some POS systems even integrate with your online store. There’s no question anymore that online sales are dominating the retail sphere, but most shoppers still trust retailers that have a physical store location as well, and of course, shoppers still enjoy the experience of a physical storefront. With POS systems like Oliver POS, which integrate your online store to make selling in-store and online easy as possible, you’re getting the best of both worlds.
But what about traditional POS terminals?
Most POS systems in 2020 are cloud-based, meaning all of their data and information is kept up in the cloud instead of stored directly within your hardware. This has many perks, such as quicker loading time, higher security, and the flexibility to bring your POS anywhere. For the most part, cloud-based POS software can be accessed from any device – and some POS systems can even work directly on your smartphone!
If you’re looking for something a little bit more professional, many POS systems do offer hardware that resembles the traditional POS terminals. Oliver POS offers a line of powerful hardware, from a handheld mobile POS to a self-service terminal! Pretty neat, huh?
There’s actually a lot more that your POS could accomplish, but that’s the basic rundown. Now, you know just how essential a point of sale is to running your business.