A Point-of-Sale (POS) System is the technology that allows customers to authorize payments and merchants to complete transactions. It can also be used to record data of transactions and analyze said data.
There are a variety of POS systems available in the market. Some are larger and smarter, boasting increased functionality for managing standard operations. Whilst others are small, compact and meant to be used solely for completing purchases.
If you want to learn more about POS Systems and what kind of your business will need, continue reading what we’ve written down below:
What Are Point-of-Sale Systems For?
There are two things that make up a POS System: software and hardware. The software refers to the digital technology used to process transactions, while the hardware refers to the physical components that are needed to complete transactions.
There are many uses for POS Systems but, at its core, its purpose is to accept, process, and complete transactions efficiently and securely. It’s the more sophisticated POS systems that have functionalities that allow the tracking of sales, management of inventory, management of staff, and so on.
POS systems are provided by merchant processing services like Platinum Payment Systems, who handle the ‘back-end’ of the payment processing process by facilitating transactions authorized by customers on POS systems and sending payments back to the merchant.
By discussing your standard business operations with a merchant processor like Platinum Payment Systems (PlatPay), you can determine what kind of POS system would best suit your business. Whether that be a large and sophisticated central hub that can perform dozens of tasks or a POS system in miniature that will allow you to simply accept payments.
How do POS Systems Work?
When deciding which POS system will be best suited for your business, a merchant processor like Platinum Payment Systems will offer you the following features to choose from:
- Payment Processing: One of the mainstays of POS systems is its ability to accept payments and generate a receipt for the customer. For most systems, this means that it must be capable of reading order details, adding taxes, and calculating the total purchase price.
- Recording Sales Data: Outside of producing receipts, a POS system can also be programmed to record and store sales data locally or through the cloud.
- Inventory Management: For bigger retail stores, inventory tracking and management functionalities can be included in a POS system. These can be useful for tracking item stocks and generating purchase orders for the future.
- General Reporting: POS systems can also be outfitted with software that can track various data points, such as sales, products, customers, and employee performance.
- Customer Management: Most POS systems also have general customer management tools that can be useful for setting up loyalty programs and the like to improve customer retention rates and encourage brand loyalty.
- Third-Party Applications Compatibility: Some POS systems are completely compatible with other business programs that manage payroll, marketing campaigns, sales data reports, etc.
A lot of these features are completely optional. Not all businesses will need or, even, want their POS system to have such features.
However, as stated by the CEO of Platinum Payment Systems, Jed Morley, it is the goal of any merchant service provider to “solve the payment processing problems” of their clients. And this is true regardless of “the size of the business or what they need to balance the different types of payments that they receive.”
How to Choose a POS System for Your Business?
To send you off with as best of an understanding of POS systems as possible, here are three things that you need to consider when choosing the best POS system for your business:
- Features: We’ve already broken down all the features that can make up a POS system up above. But it can bear some repetition! When choosing a POS system, make sure to pay attention to the following characteristics: payment processing, analytics, inventory, and support.
- Number of Sales Points: How many Sales Points do you expect your business to have? Most retail shops only need a single POS system, but some might require multiple sales stations to handle a large volume of traffic.
- Traffic: Outside of the number of sales points, there are other considerations to be made when accounting for sales volume. Like the speed that your POS system can process payments.
Consider all of these three factors and you will find the most suitable POS system for your business! More likely than not, if you are cooperating with a merchant service provider like PlatPay, this decision-making process can be done with them, but there is merit in understanding the way these central hubs work.