A point-of-sale (POS) system is a popular tool for brick-and-mortar businesses. They’ve replaced the old-school cash register with a more sophisticated, tech-forward approach to the checkout process. Shifting your business from using a basic cash register to using a POS system can feel like a daunting task. However, exploring all the benefits a POS offers—including greater operational efficiency, increased sales, and happier customers—will make your choice obvious.
1. Saves Managerial Time
POS systems are more than a tool to process payments. Increasingly, they are the hub that connects all of your small business software tools, from scheduling and payroll to accounting and inventory management. Modern, cloud-based POS systems either include all these tools in an all-in-one system or give you the option to connect to other software applications to build your complete software solution. This is frequently referred to as “integration” or using “integrated apps.”
Choosing a cloud-based POS that integrates with your other business software shaves off hours of managerial work. You can purchase and receive inventory in your POS and sync your sales data directly with your accounting software. In addition to connecting with traditional accounting software, many POS systems like Square offer payroll services to handle the financial element of your business in just a few clicks. You can also build staff schedules in your POS and manage your employee hours
2. Increases Speed of Service
About half of consumers prefer to shop in-person, and 65% cited long checkout lines as their biggest complaint. This is where point-of-sale features come into play. POS systems make checkout simpler and faster; they also enhance every step of the buyer journey—from research to post-purchase.
• • Accommodate various payment methods: Eliminate that embarrassing moment when your customers dig through their wallets to find the right card. Offering e-wallet, contactless, and PayPal payment methods can help reduce the time it takes customers to complete transactions.
• • Saved payment types: Returning customers don’t even need to take their wallets out when you save their preferred payment method in your POS. This method is an excellent strategy for boutique and service businesses that have close client relationships.
• • Check out on the sales floor: Reach customers where they’re at, without needing to wait in line. Mobile and tablet POS systems allow associates to ring transactions on the sales floor as soon as shoppers make a buying decision.
• • Sell online: Buy online, pick up in store (BOPIS) can reduce lines. Customers only need to visit the store for fulfillment. Online checkouts allow for curbside pickup, so customers can minimize waiting time.
• • Ship from store: Customers can order items online or over the phone, without waiting on-site for their purchases. This is handy with bulky items like furniture and appliances.
• • Self-service kiosks: Especially in the food service industry, allowing customers to place their own orders reduces ordering time, saves you labor costs, and increases sales. When McDonald’s added kiosks to select locations, those businesses saw a 5%–6% increase in sales.
3. Boosts Revenue
We’ve already mentioned several ways that a POS system boosts your revenue by improving customer experience and moving at the speed of developing technology. But even without those cutting-edge features, a POS boosts your sales by increasing the number of revenue streams—or sales channels—your small business can handle.
4. Provides Accurate, Real-Time Data
While you can track key performance indicators (KPIs) manually using spreadsheets and shared drives, it can quickly become cumbersome and tedious—taking you away from more critical business matters. With a POS, most of that tracking is automatically done for you, so you can focus on more impactful tasks like helping customers, merchandising your sales floor, or designing new menu items.
In addition to daily sales, you can easily track these retail metrics with your POS:
• • Average Transaction Value (ATV): The typical amount a customer spends when they shop with you.
• • Items Per Purchase: How many products they buy on average; items per purchase, also sometimes called units per transaction (UPT), measures the average number of products sold during a customer transaction in a specific period.
• • Sell-Through Rate: The percentage of an individual product sold during a specific time frame
• • Sales Per Square Foot: The average revenue your store brings in for every foot of sales space
• Conversion Rate: Compares the number of people who enter your store or visit your website with the number of people who make a purchase
• • Cart Abandon Rate: The percentage of online shoppers who place items in their shopping cart but leave the site before purchasing, essentially abandoning their virtual cart
• • Customer Retention Rate: A retailer’s ability to hold on to current customers and keep them coming back
• • Gross Margin: The percentage of store or product revenue that is profit
• • Sales Per Category: The total sales a retailer has for each type of product
• • Sales Per Employee: How much revenue each staff member is bringing in