A feature-rich point-of-sale (POS) system is one of the most valuable tools for a retail business. This one piece of software can fill many needs. It can track inventory, process credit card payments and provide unique insight into how your business operates. Being able to accomplish all of these tasks from one system not only helps streamline how your business is being run, but it can also save you some money.
A good POS system can integrate multiple areas of a business into one interface, but what other components are vital to retail businesses? Here are eight essential features you should check for before you choose a system for your retail business.
1. Online management
As we merge into a technology-dominated society, having both an in-store and online presence is vital for businesses to maximize sales and profits. Customers want to buy online and pick up in-store (BOPIS), and view a website to see if something is in stock before they go to a store. To increase your online presence and grow your business, your POS system should offer an omnichannel experience and online sales management. These two work hand in hand, as online sales management provides the option to effectively regulate e-commerce, while an omnichannel platform supports the sales of products everywhere your customers are – in-store, mobile, online, mobile online and social media.
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When analyzing online management and omnichannel features, Adam Watson, director of Hollywood Mirrors, said that his POS system, Brightpearl, can function on multiple platforms and has allowed his business to thrive online. Hollywood Mirrors operates through 11 sales channels, including its own website and sites such as Amazon.
"The way we worked before – managing all the sales channels and all the product listings – it was so labor-intensive," Watson told Business.com. "It was really difficult; we had to have someone keep an eye on products going out of stock all day long, as well as ... product listings on eBay, Amazon and our own websites. They had to do this from memory, and the stock quantities were in their head. When I think back to this time, it was a crazy way to run a business."
2. Inventory management
One of the best features online POS systems offer is the ability to track inventory in real time. By integrating business orders with online and in-store purchases, business owners can track their supply levels quickly and efficiently.
Watson said that Brightpearl has been a huge help in keeping track of his products. "The stock reporting shows the rate that the items are selling at and [predicts] when they are going to go out of stock. It also takes into consideration lead time from the supplier in the algorithm. It has resulted in us becoming more organized and streamlined with less products, less stock, but revenue and profits are up. We are a lot leaner business because of this, and ordering stock with suppliers takes a few minutes instead of 30 minutes."
By tracking inventory in real time, businesses can save money and avoid making mistakes when ordering from a supplier.
3. Employee management
In addition to managing and monitoring the supply flow and finances of a business, some POS systems offer the ability to manage worker productivity.
Ann Motovidlak is a front-end supervisor for Gerrity's, a grocery store based in northeastern Pennsylvania. Gerrity's has nine locations in the area, and Motovidlak said that managers use the RORCv6 POS system to track employee use.
"Cashier productivity is a feature we like to use," she said. "We monitor our cashiers' sales, scans and items per minute, and voids. It also assists us in loss prevention."
Tracking productivity can be a valuable function to maintain a secure and financially sound working environment. For many small businesses, managing employees and closely monitoring sales creates a more reliable and efficient workplace.
A number of POS systems also feature built-in timeclocks, employee sales information and security management geared directly toward employees. Some even allow business owners to set permissions for different employees based on role, store or individual. By managing a worker's access to different areas of the business, owners can ensure that their operations run smoothly and safely while avoiding micromanagement.
4. Third-party software integrations
A POS system that integrates with other programs can add a customer management aspect to your business without you introducing an entirely new production process to accommodate a new program.
Integrating with third-party software can enable you to adopt new functions such as recording customer information, maintaining loyalty programs and offering targeted promotions. Some POS systems have built-in CRM features, and some offer a series of readily integrated software.
Ben Adler, owner of Rebicycle in Montreal, said that his business uses Lightspeed, a POS and e-commerce solution, and third-party scheduling software Booxi to create custom bikes. Lightspeed and Booxi integrate seamlessly, so Adler can record customer booking information without inputting it multiple times.
"When somebody makes an appointment on Booxi and they actually come in the store, I already have all their customer information, including their phone number, their email address and what service they're coming in for," he said. "I can automatically create a work order in Lightspeed with that customer information already populated, and so it's very easy for us to make a quote on the spot."
5. Reporting tools
Reporting tools are important features for retail POS systems. Retailers need to see not only their sales, but also which products are their best sellers (top margins) and worst sellers (low margins). Seeing hourly transactions and product movement will enable you to adjust your purchase orders accordingly.
Reporting tools also allow you to see how effective your promotions are, your top salespeople and consumers, and customer buying trends. You can identify what days, times, and seasons are busy and slow, helping you optimize staffing levels. Many reporting tools let you apply different filters, like a timeframe, so you can narrow down exactly what you are looking for.
6. Credit card processing
Credit card processing is another vital feature to consider when choosing a POS system. You have the option of a POS system that is compatible with a processor or a POS system that offers in-house processing services.
The best POS systems are compatible with multiple credit card processors, or at least give you the option to compare rates and switch processors if needed. This is especially important if you have issues with a processor.
While some POS companies offer convenient, in-house processing services, these can be more expensive than POS systems that simply offer processor compatibility. This option can also be more challenging, since you have to replace both the POS system and the processor if you switch services.
Both options are more convenient and accurate than having your credit card processing as a separate system – where you ring up the customer's purchases on the POS system and then manually enter the total on the credit card terminal. By ensuring that your retail POS system has credit card processing ability or compatibility, you will be able to successfully accept customer payments.
Mobile POS systems are becoming common in retail, with customers beginning to expect it. Consumers hate waiting in line, and the mobility aspect reduces this problem. Stores like Apple use the mobile POS system for their sales associates to check out customers anywhere on the sales floor. This gives customers a more personalized experience and lets them skip the line altogether.
You can use the mobility feature in other ways as well. Stores with a traditional countertop checkout station can add a mobile tablet to the system to use as a "line buster" when they get busy. In some instances, mobile POS systems can be set up as self-service checkouts. Businesses that go to farmers markets and trunk shows greatly benefit from mobile POS systems as well.
If you are opening a small retail business for the first time, you might not initially need all the extra widgets and features available. However, as your retail business expands, it is essential to have a POS system that can expand with it. This can be the difference between seamlessly upgrading your POS system to fit your new needs and having to move your information to a completely new platform.
Jean Iennaco, director of operations for Over the Top Cake Supplies in San Antonio, Texas, said her company now has multiple corporate stores and franchise locations. While she initially had no need of a POS system that supported multiple locations, that feature became critical as her company grew. Iennaco said her Revel POS system has been great for managing the expansion.
"We initially had another POS system, which wasn't compatible for multiple-location use, so we switched to Revel, which is compatible," Iennaco said. "We have four locations. I can be anywhere and help them out if there are issues. For example, I can check on locations by going into reporting and offering advice on ways to increase sales for the month. It's user-friendly and convenient for having multiple locations."
If Iennaco had used a scalable software like Revel to start, she would not have had to go through the trouble of switching systems. This is just one example of how a system can be scalable.
Retail POS systems come with many features that are beneficial to your business. The key is to analyze your business's needs and prioritize the features that are most important to you before choosing a system. Regardless of which POS system you use, an omnichannel platform that can easily integrate with third-party software is a must. In addition to those features, reporting tools and inventory management go a long way to increase productivity.
Additional reporting by Matt D'Angelo. Some source interviews were conducted for a previous version of this article.