By Margot Carmichael Lester, Staples® Contributing Writer
Cha-ching! Hearing the cash register ring is music to every retailer’s ears. But you need a point-of-sale (POS) system to take and record transactions, and choosing the wrong one can hit a sour note.
There are so many POS systems to choose from and considerations to weigh that you may be tempted to just stick with an antique cash register and paper ledger. Don’t kid yourself, though. POS software and systems are crucial to your bottom line.
Here are five things to consider when evaluating POS systems:
Debit, credit and gift card processing fees can be costly, so many small business owners work hard to lower expenses for themselves (and their customers) by choosing a POS system with favorable terms. But small businesses cannot always choose the terms. “Many POS system makers will enter into an exclusive agreement with a particular processor,” explains Ben Dwyer, founder of CardFellow.com, an online card-processing comparison service. “The processor pays the POS maker an ongoing commission from your business’s sales, in return for the exclusive right to process transactions for the maker’s clients. This completely eliminates a business’s ability to shop for the most competitive credit card processing solution.”
Take Action: Select a point-of-sale system that supports a range of credit card processing services.
Consider what your point-of-sale software can do in addition to taking orders and processing payments. Did you know you can manage labor reporting via POS software? Or push advertising, coupons and loyalty programs onto the POS screen? “Think of everything your company may need down the road,” says Kathy Doyle Thomas, executive vice president and chief strategy officer of Dallas-based Half Price Books. When recently updating her business’s POS system, Thomas talked with marketing and IT experts to understand what they needed from the software now and would need in the future.
Take Action: Prioritize your list into must-haves and nice-to-haves so you can make smart decisions. And don’t pay for features and software you don’t need. Learn more about POS system bundles.
You don’t get much benefit from point-of-sale software that doesn’t integrate with your accounting and other business software. And there are more compatibility issues coming. “Make sure you’re thinking ahead about a system that can be integrated with the upcoming surge [in new technologies],” says Michael Trepeta, CEO of Mobiquity Networks, a mobile marketing company in Garden City, NY. Emerging payment and eCommerce technologies, like smartcards, digital wallets, mobile apps and Bluetooth® beacons, are already in limited use and expected to grow. Planning for these innovations (a practice known as future-proofing) is key.
Take Action: Verify that your point-of-sale system accommodates your current software and developing payment technologies. Also, look for a POS system built on an open platform that allows third-party developers to create small business�friendly apps to make your job even easier.
Point-of-sale systems should be easy to use by even the least experienced staffers. And if you’re running a micro-enterprise, you’ll want a tablet-based POS system that allows you to move around and interact with customers or handle issues in other parts of the store without leaving the register unattended. “We have some clients who will pick up a tablet from one counter and bring it to another. This way, when checkout lines get long, they can go to the customer instead of asking the customer to go to them,” says Aron Schwarzkopf, co-founder and CEO of Leaf, a Boston-area maker of a POS tablet solution, similar to Square or PayPal Here.
Take Action: Test-drive each POS system with a live demo to make sure it’s easy enough to navigate a sale. Consider a tablet-based POS solution for increased mobility. Ask your trade association about tablet solutions designed for your particular vertical.
Forty-six percent of global credit card fraud occurs via point-of-sale systems, so protecting yourself and your customers is critical. “Retailers big and small must ensure that their POS systems are up to date with the latest security standards,” says Todd Trammell, senior product line manager for compute and connectivity at Broadcom, a microchip manufacturer in Irvine, CA. “By October 2015, U.S. merchants will have to have EMV-compliant terminals.” EMV (which stands for Europay, MasterCard and Visa) uses encrypted chips on credit cards to protect financial information. “It’s almost impossible to fabricate a chip with this encryption, so it reduces the risk of fraud and adds more security.”
Take Action: Consider only point-of-sale terminals that meet EMV requirements to reduce replacement costs later and protect you from fraud.
Use these tips to choose a new POS system that makes it easier for your cash register (or tablet computer) to ring in the sales.