What are POS software? For retailers, they are heaven-sent. First of all, the use of the best POS software translates to higher profits. Next, it gives access to a mine of rich customer insight. Also, it gives your inventory an efficient system, which involves tracking and monitoring capabilities.
And most of all, it increases customer satisfaction and loyalty because of speed, accuracy and convenience in terms of purchase journey.
Nonetheless, technology proved to be useful in promoting efficiency, streamlined processes, and integration capabilities. These results in increased productivity, which could mean more time devoted to core activities that will help in realizing more profits and in developing more innovations that will accelerate your business growth.
What Is the Difference Between a POS and a Cash Register?
POS is generally an evolved version of a cash register. But the former is way ahead of the latter in terms of purpose and tremendous functionalities that go beyond the traditional means of payment processing. The cash register is more of a computing device; it only reports how much went in and how much went out. At the end of the day, you still have to manually transfer its reports to your spreadsheet and reconcile the data by yourself.
In POS or Point Of Sale systems, the primary selling point is automation. But the meat is in the insight from customer data, which leverages your business by standing on a profit-making viewpoint. In this perspective, you gain information about your strengths as a retailer, your loyal customers, the crucial time for purchases, and the seasons of low sales and high sales. Its advanced computing system not only lets you get your sales report of the day but can also retrieve the ones from even a year ago. This big data capturing and storing is critical in strategic planning and prediction of future sales outputs that influences the way you should stock-up on your inventory.
A POS software is more dynamic than cash registers because of its capability to incorporate other devices that can improve your payment processing in ways that encourage more sales. It can be connected to a computer, a scanner, a credit and debit card reader and terminal, an internet connection, etc. In more advanced integrations, a POS terminal and its software can create a self-service check-out for speedier payment processing.
Today, POS systems are sophisticated devices which are capable of integrating with your other back-end technology-based business processes like accounting software and inventory management system. There are also some which can be wirelessly connected to handheld gadgets for additional access points and mobility. Customizable POS is also an advantageous choice as it can scale and grow based on your needs.
Advantages to Retailers in Using a POS System
A POS system’s edge over its forefather, the cash register, is basically its capability to store, process and give out expanded data and information associated with purchases. It can log different customer data, which are useful in making informed decisions about business development, marketing and customer relationship management (CRM). The technology behind it is not the sole breakthrough, but rather the way it enabled the system to gather, process and analyze an already existing data in the first place.
This offers much functionality, which makes it a comprehensive solution that can raise your profits directly and indirectly. In fact, according to a white paper released by Microsoft Business Solutions about the effects of POS implementation in retail sales and profitability, there has been a reported 10 to 24 percent increase in sales within six months after the POS system was installed. After two years it yielded a steady 8 to 10% growth, due to a number of indirect benefits, like more efficiency in other business processes due to the additional insight from data.
On a more specific business case, the Hospitality Technology’s 2014 Annual POS Software Trends Report, it was found that adding mobile POS integrations is the most influential driver concerning its adoption. 69.6 percent of the respondents find it beneficial to have such functionality with their POS software.
Additionally, here are more benefits of POS software for retail:
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Advanced and detailed reporting and data analysis
Why use POS software? Because you need to analyze your data so it can provide more value for your business. A POS software is capable of consolidating data from both offline and online purchases and arranges them into more logical categories for better understanding. Customer data like credit or debit card numbers, transaction times and dates, items purchased, frequency of visits, and item exchanges or returns will help you analyze:
- How you can better serve your customers by studying purchase behavior patterns.
- When it is time to replenish the stocks (through automatic system alerts).
- When are your peak and lean seasons? So you can know when is the best time to conduct inventories or hire additional seasonal employees.
- When to schedule sales and promotions.
Transactional histories can also be easily retrieved and analyzed, so as to determine your rate of growth, Return Of Investment (ROI) and the most and least purchased items. You can also track which are the seasonal and the consistent sales-incurring items, which you can stock up on the right time. This way, you can maximize your capital for inventories that will yield you the highest returns.
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Network integration
With its digital nature and fast computing capabilities, it can be an ideal source of data for your other existing business process systems. You can effectively integrate it into your company’s computer network for a seamless workflow and management. You can backup your data to your centralized document management system or company cloud storage. Thus, your other systems can easily download its data whether they are wired or wirelessly connected to the server.
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Improved user efficiency
Sales reports are often difficult to produce from cash registers as it requires you to retrieve the data first and then transfer to your spreadsheet. You have to do the reconciliation and data interpretation yourself. The loopholes in manual processes can introduce unnecessary human errors which may affect the integrity of your data and sales analysis.
Since with POS you are dealing with digital systems, you can increase your employees’ efficiency in processing payments. Not only that they accomplish the work faster, there will be a slim possibility of errors since there is minimal manual input. Barcode readers are the answer to this, which can be integrated into the POS system. This way, the user can easily scan and take note of the items purchased. Cost savings and additional revenue come having to process more accurate purchases at a less amount of time.
Another aspect of user efficiency is the lack of need to memorize prices. With smart tagging system used in barcodes, you can input prices in a centralized system that the POS can access. Scanning the item will let the system identify the price right away based on the barcode.
Lifting these tedious and time-consuming tasks of memorizing prices and manual data input will increase your employees’ confidence and make them less tired. This way, they can be mindful of rendering quality, accurate and pleasant customer service, which are essential in broadening your loyal customer base.
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Stocks and inventory management
The integration of barcoding system will help you store inventory information in a more efficient manner. This way, you can easily track volumes and other stocks information in real-time. You can also make immediate sales reports to assess the workflow and identify crucial information like when it is time to replenish stocks or pull-out products that are nearing its expiration date.
Stocks can be easily tagged and scanned upon delivery, making it faster to account shipments. Analyzing the frequency of stock deliveries can help you negotiate with your suppliers more effectively, thus maximizing your profits.
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Employee tracking and monitoring
Your POS employees can be provided with a barcode of their own, and tag them to the purchases they process. By analyzing this information, it can help you gauge their performance, which is valuable in performance-based incentive programs and evaluations prior to promotions. It can also foster a healthy competition among your team, which can make them more productive as well. It also minimizes the opportunity for employee theft to take place.
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Pricing consistency across multiple branches
By connecting all your POS systems in multiple branches lets it access a centralized pricing scheme, which regulates your pricing all throughout. This especially favorable for companies that utilize a centralized inventory management system, because changes also automatically apply to all branches.
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Simplifies your accounting system
No need for your accountants to check a bulk of receipts and daily sales reports, as every data is captured real-time and stored in a centralized database for fast access and retrieval.
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Self-service check-out
A fully integrated POS system is a powerhouse of functionalities and usability, which is intuitive and easy to operate, making it ideal for self-service check-out counters in retail shops to materialize. This will make the purchase process faster and more efficient, which can boost your revenues.
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Comprehensive purchase information to customers
The information indicated on receipts can be made comprehensive due to the different types of data that can be put on the barcodes tagged per item. This way, your customers can be better informed about the items they purchased, their transaction date and time, and even loyalty points they garnered (if applicable).
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Customer insight for marketing and business development
Analyzing customer behavior from the data that the POS systems capture is a gold mine when it comes to providing valuable cues that will make marketing more effective and business development faster. Marketing insight can help you come up with promotions and sales that will engage your customers to buy more and in staying loyal to your business. On the business development side, you make more informed decisions and predict trends and cycles which are essential in annual performance evaluation and planning.
Choosing what POS software is the best to meet your needs shouldn’t be a tiring and daunting task to do. Check out PoS software reviews from CrowdReviews.com to know more about first-hand experiences and feedbacks from real clients, and where to buy POS software which will give you a competitive advantage.
Keith Moore
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