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Point-of-sale systems and their reports offer ways to increase sales and streamline waste at your retail store.
Many successful retail stores still use old, bare-bones checkout systems. Although these work well enough for basic transactions, they don’t offer much insight into how your business could be streamlined. The best point-of-sale (POS) systems designed with retailers in mind are loaded with reporting functionality to increase sales and minimize waste.
If your retail establishment has recently transitioned from a basic register to a feature-rich POS system, or if you’re simply considering doing so, this guide can serve as an introduction to the POS reports that many retailers find useful.
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A POS report is information generated through the data collected during each sale you make. At a minimum, the data tracked by a POS system will include transaction totals and items purchased during each transaction.
However, POS reports can also provide valuable insights to businesses that go beyond individual sales. For instance, POS systems can generate a report for each employee’s transactions. This helps managers instantly access sales figures to calculate who is making the most sales. POS reports can also compare figures by location. For instance, if you’re a franchise owner and note that one store is not performing well, you can identify and troubleshoot the issue early on by relying on the POS report data.
POS reporting can be very basic or extremely robust, but the best POS systems for retail businesses offer the following types of reports.
Sales reports are vital for retailers. A sales report gives you a summary of sales activities for the day, week, month or a specified period. It typically tells you the volume of sales, type of products sold, new customers you added and your costs. All POS systems and accounting software generate sales reports that you can format in various ways. In our QuickBooks review, we found that the software’s sales reports show sales by customer, sales shipped to a specific address, and pending sales, among other data.
Sales reports are important to ensure your business is performing. They are easy to run daily or weekly with a POS system. Source: QuickBooks
Employee reports are also vital for retail businesses that must balance staffing with demand. These reports can help you determine which employees are selling and which aren’t, so you can put your top sales clerks on the floor during busy periods to maximize sales. You can also use employee reports to calculate commissions and bonuses.
Inventory reports are extremely important for retailers so they aren’t stuck with excess inventory of slow-selling products and insufficient stock of popular ones. The POS inventory reports enable you to track your inventory to determine which products, colors and sizes are selling and which aren’t. You can set alerts when inventory falls below a certain threshold.
Most POS systems allow you to view sales data in real time and run reports on past sales to spot trends and patterns. You can view store sales based on dates, times and even hours, which can help you make better staffing, inventory and store hours decisions. With many POS systems, you can also run individual sales reports on specific employees to identify who needs some help and to more easily reward your top earners.
Store sales reports can tell you which locations are doing well and which ones are performing poorly. Source: Square
Identifying top sellers is easy, even without specific reporting software, but the items that sell in the largest quantities aren’t necessarily the ones netting you the most profits. POS retail reports break down sales in terms of the itemized cost for you, retail markup percentage or amount, and profit.
Having this information laid out in a readable format makes it much less labor-intensive to find the dead weight in your inventory and identify major moneymakers that may have flown under the radar. These types of reports can also help retail store owners adjust costs and prices or locate new suppliers as needed.
Retail POS systems make inventory management a breeze. Inventory management reports allow you to track stock based on SKUs (stock keeping units), even across multiple locations. Inventory management isn’t just for maintaining existing inventory but also for tracking quality. In a good inventory management system, you can see how many damaged goods you’ve received from different vendors and how often you’ve had to send things back. Identifying low-quality suppliers is key to maintaining high retail standards.
Many systems also have automatic email options based on inventory numbers, so you can receive updates when highly desirable items are running low and reorder them immediately. The ability to look back at inventory ups and downs over the course of several months or a year makes it much easier to plan inventory and identify buying trends.
Inventory reports are vital to ensure you don’t overstock slow-selling items and run out of hot ones. Source: Lightspeed
Customer reports allow you to view valuable customer data, such as contact information, order and reservation history, and loyalty program details. Customer reports can be a valuable tool for earning repeat customers and maximizing sales, since they allow you to send out personalized marketing emails and reward customers for their loyalty or special occasions.
For business owners who have multiple retail locations, reports that provide side-by-side comparisons are invaluable. You might find that one of your shops sells more of a certain type of product than the other, or that each shop experiences peak sales at different hours or times of the year.
Comparisons also help you see the differences in your staff at various locations and identify weaknesses and strengths on your sales team. You might find, for example, that the top three sellers at one branch outsell the top three at your other branch by double. If that’s the case, you may want to pair your most gifted sales associates with others who show promise but need improvement.
Naturally, the type of retail establishment you own will determine the role of reports in your business. A women’s fashion boutique will have different patterns and tendencies than a used-car dealership or a furniture store, and because of this inherent variation, many POS systems allow users to build highly customized reports. [Read related article: Retail Marketing Strategies to Better Market Your Store]
To get the most accurate and helpful POS reports, follow these best practices.
If you manage and sell via multiple channels — such as online, at a brick-and-mortar store and through a pop-up shop — make sure that all of your sales data from each channel is going to one central location via your POS system. However, it is important for each sale to be tagged with the sales channel used. This will allow you to evaluate each sales channel to see which ones are underperforming or successful. Having all of your sales data in one place will let you generate reports that identify trends, inform product buying, and improve your marketing and promotion strategy.
The best POS systems for retailers include an inventory management module. When your POS software automatically updates your inventory system, it saves you a lot of time. It also allows your business to be agile by reordering the fastest-selling items and phasing out unpopular products. Staying on top of your inventory also helps you avoid selling out of the products customers want.
A general sales report will show you how much you have sold of each product in a specific time period, which is necessary from a big-picture perspective. However, it can also be helpful to look at sales through other lenses. For example, you can output reports by location if you have multiple establishments or by employee within locations.
You also may want to look at sales by customer or customer stage (new vs. existing or by time as a customer). This can give you insights about your most valuable locations, employees and customers and inform decisions about where to concentrate money and effort in the future.
If you look at specifically who is buying your products, you might be surprised. You may find that just a handful of customers account for the bulk of your sales, that certain customers typically purchase your most profitable products or that the customers buying the most are not the ones you have been actively targeting. This information can help you create loyalty programs, retarget your marketing and boost sales by offering personalized offers.
Depending on the volatility and seasonality of your business, you will want to generate sales reports at least quarterly, but possibly weekly and monthly as well. At the end of your busiest season, run a report for that period and for the entire year so you can plan your inventory purchases for the following year and assess how well your marketing strategy worked. Review your reports with your marketing, purchasing, sales and merchandising teams to get feedback and give them ideas of how to improve results in the future.
A handful of POS vendors stand out for generating reports. They provide robust reporting on sales, inventory and more, and don’t charge extra for it. These reports can be customized, and they are automated and easy to run, saving you precious time. While all of our choices for the best POS systems for retailers offer reporting capabilities, some excel more in that area, including Square, Epos Now and TouchBistro.
Jennifer Dublino contributed to this article.