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Features of POS Systems

Sean Peek
Sean Peek

Find out which features to look for when you're shopping for a new POS system.

With dozens of point-of-sale systems to choose from, each with varying features, it can be difficult to decide which is the best POS system for your needs. Understanding the different types of systems, with their different features and benefits, will help you narrow down your options and find the right POS system for your business.


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Depending on your business and the customer experience you're looking to provide, there are different software features to prioritize when you're shopping for a POS system. Here are the top six features that most businesses look for in a POS system. [Read related article: What Is a POS System? (and Other Common Questions Answered)]

1. Mobile apps

Most POS systems have applications for both Apple and Android tablets and smartphones that enable you to use your devices for mobile checkout, ringing up customers anywhere on the store floor or giving waiters the ability to take orders and payments at the table.

While most POS systems are dual-platform, some are exclusively for Apple or Android. If you have a strong preference for one platform over the other, you should take this into consideration when picking out a system.

Most POS systems are designed for iPads, as they are more user-friendly and secure, though more expensive, than Android tablets. However, a few systems are designed for Android, touting the platform's greater allowance for feature customization than iOS. [Read related article: How to Choose a Mobile POS System]

2. Inventory management

Whether you're in the food service industry and need a menu rundown on your system or you have a retail store and need to track product quantities, the type of inventory management your business needs will determine what type of POS system you should invest in.

Although most POS systems include inventory management features, some are more robust than others. If your business needs an advanced inventory management system, make sure that option is available for your POS system or that it integrates with your choice of inventory software.

3. Customer management and loyalty programs

How much customer data do you need to collect for your marketing efforts? Using a POS system, you can gather email addresses, phone numbers and addresses, and the system can track sales data like purchase histories and buying trends. This allows your business to create specific and targeted offers to incentivize your customers to keep shopping with you.

Advanced POS systems can use customer data to generate just-in-time marketing, personalized for the customer at the checkout counter. For instance, the system might generate instant coupons based on what the customer has just purchased.

Loyalty programs aren't usually part of the core feature set of POS systems. However, several offer loyalty programs that you can add to the system for an extra cost, and some POS systems integrate with third-party loyalty programs.

4. Employee management

If your business employs multiple people, you want a POS system that can help you manage them. As the system administrator, you'll be able to manage employee access to different features of the POS system. For instance, you can grant permissions to certain employees or positions to handle certain tasks, such as issuing refunds or voiding transactions.

Some POS systems can also track work hours with a built-in time clock and help you create employee schedules. If you already have a time and attendance system or employee scheduling software that you like, see if it integrates with the POS system.

5. Reporting

Every POS system generates reports, but you'll want one that comes with the right analytics for your business, since the depth of reporting varies by system. Will you need basic reports for sales per hour, inventory management or other metrics?

Look for a system with customizable reports that allow you to filter data by date range and other factors. You may also want to look for a system that allows you to customize how the data is visually presented and schedule automatic reports to be emailed to you.

6. Integrations

Your business is likely already using other types of business software, such as for accounting or CRM. The ability to integrate those with your POS system may allow you to work more efficiently, as the systems will automatically share data rather than require you to manually transfer it between systems. Look for a POS system that can integrate with your existing software and any that you plan on using in the future, as this will make it easier to manage your business as you grow.

Industry-specific POS features

Most POS systems are specific to a certain industry, so they include a selection of features that broadly fall into these industry-specific packages.


The retail industry is one of the predominant users of POS terminals, which almost always integrate with inventory and accounting software. In addition to processing transactions, the POS system often supports customer loyalty cards, gift cards, gift registries and coupon redemptions. [Read related article: 8 Essential POS System Features for Your Retail Business]


The hospitality and hotel industry needs to track guests as they interact with various services throughout their visit: the dining room, their guest rooms, golf or tennis lesson reservations, spa visits, etc. POS systems can also store guest preferences for amenities and housekeeping, allowing hospitality staff to anticipate guest needs rather than respond to requests – thereby raising service levels, customer satisfaction and loyalty. The POS software usually integrates with property management software.


Some of the first touchscreen terminals were used in the restaurant industry, particularly fast-food chains. Today, they are the standard means to input and track orders, process payments, and generate customer receipts. A growing trend in quick-serve restaurants is the use of text alerts to notify customers when their orders are ready for pickup. Even in fine-dining segments, waiters are equipped with mobile devices to send orders directly from the table to the kitchen. The same devices notify waiters when orders are ready for delivery to the table. [Read related article: 5 Money-Saving Tips for Choosing a Restaurant POS System]


In the grocery business, POS systems can be part of self-checkout lines and typically incorporate weight scales. Some systems also allow customers to use barcode scanners to record their selections as they place products into their carts, expediting the final checkout process.


Professionals in the hair and beauty industry need to enter, modify, and track client appointments and preferences in a system that can generate performance reports and loyalty profiles, as well as identify and correct workflow inefficiencies. The POS system also maintains an inventory of beauty products and compiles a database of customer emails to send appointment reminders, special offers, and other notifications.

5 benefits of a POS system

While a good POS system can help a business owner manage sales and inventory, it can also help them increase their business intelligence and marketing skills. These are the five primary benefits of a POS system.

1. Increase store profitability.

POS systems can help you increase your in-store profitability by monitoring your inventory and recording your customers' behavior. With this data set, you'll be able to create more pointed and specific marketing campaigns and sell only the products that your customers buy. This encourages more customers to return and helps you avoid holding on to a surplus of immovable products, making your store more profitable.

POS retail apps on your smartphone or tablet can also be used as instant access points, allowing you to sell and order from wherever you are and not be confined to a physical location.

2. Reduce administrative costs.

Once your POS system is installed and operational, it will reduce the time you spend on administrative tasks, which can save you money. Your system will provide relevant operating reports as well as buyer and inventory data, which saves you the time of collecting this data. Since POS systems are used as checkout stations, you'll also spend less time on cashier duties and more time focusing on the business itself.

3. Manage inventory.

If your POS system comes with inventory management features that allow you to see your stock in real time, you'll always know what you have on hand and what your customers are buying. This lets you make informed decisions about future inventory purchases based on buying trends and customer demand.

4. Improve your business intelligence.

If your POS system has robust reporting features, you can run reports that clearly and accurately streamline your incoming data to make it easier for you to understand, helping you make more informed decisions about your business. You'll be able to dig into your sales data to identify your business's trends around inventory, customer behavior, high-volume shopping times and budget lines.

5. Boost your marketing and loyalty features.

One of the most useful features of a POS system is how specific it can be about your customers' buying trends. It can show you what they buy, how frequently they shop at your establishment, and how much they spend.

When you understand who your customers are and how they shop, you can create specific marketing messages, loyalty programs and other incentives for them. This allows you to reward your best customers and enhance their experience, instead of losing money on general discounts.

POS hardware options

The type and number of hardware devices that you need for your POS system depends not only on the physical size and location of your business, but also on your branding and marketing strategies. For example, retailers frequently employ "stores within a store," where the idea is to capture sales immediately at multiple retail displays placed throughout a single store. This gives you the ability to capitalize on impulse purchase decisions, and to cut down the long register lines at crowded exits that might discourage shoppers from shopping at your store again.

The hardware necessary to set up POS stations is often a combination of the following devices:

  • Tablets
  • Touchscreens
  • Mobile phones
  • Desktop computer or laptop
  • Credit card readers
  • PIN (personal identification number) pads
  • Receipt printers
  • Cash drawers
  • Barcode scanners
  • Scale

It's increasingly common for these devices to function on mobile platforms, which adds to the flexibility in placement of the terminals as well as the environments in which they can function. In addition, web-enabled terminals allow for inventory tracking across geographically dispersed locations and for remote training, operation, and diagnostics. [Read related article: How Much Does a New POS System Cost?]

POS software options

Certain industries have different needs for their POS software. For instance, a restaurant has different POS software requirements from a hardware store or a hotel operation. The size of your business also determines the type of POS software you need. A small mom-and-pop business has less complex needs than a large chain.

In some cases, the operating system is proprietary, but there are also standard Windows and Mac offerings. The generally accepted industry standards for dedicated POS systems are OPOS – or OLE Point of Sale, which uses the Object Linking and Embedding technology developed by Microsoft (and hence is a Windows-specific application) – and JavaPOS, which uses the Java programming language and can run on any OS platform.

An increasingly popular choice is a web-based platform, also called a cloud-based POS, because it is largely OS-agnostic. Web-enabled POS systems can not only run on any computer with an internet connection and browser, but frequently offer an app for smartphones and tablets – though these are sometimes platform-specific.

An additional advantage is that cloud-based systems run remotely from one or more secure servers, eliminating the need to install and update software at the local level. In addition, the centralization of data provides a single repository that can be accessed across geographic and organizational locations via simple internet connection, which also reduces operational overhead costs. [Read related article: A Guide to Help You Choose the Best POS Software]

POS services

POS systems come in a variety of "flavors." There are complete bundled packages of hardware, software and services that may be put together by the original equipment manufacturer or a reseller. Systems can be leased or bought, and some are free to use if you sign a multiyear contract for payment processing.

Alternatively, you can buy POS software or subscribe to a SaaS plan that you can then use with a computer, smartphone, or tablet and a card reader. With this option, you can often choose to buy POS hardware from the software provider or from a third-party vendor.

After-sale services may include basic onsite repair or remote telephone support, email support, and upgrades. Such after-purchase care may run for a predetermined period or require a service plan at an additional cost. Warranties usually run from one to three years, although some vendors offer lifetime warranties.

Additional services, typically arranged by the POS vendor through a third party, include credit card processing, cash advance and loan services, financing, remote backup, and equipment leasing.

Image Credit: SeventyFour / Getty Images
Sean Peek
Sean Peek
business.com Contributing Writer
Sean Peek has written more than 100 B2B-focused articles on various subjects including business technology, marketing and business finance. In addition to researching trends, reviewing products and writing articles that help small business owners, Sean runs a content marketing agency that creates high-quality editorial content for both B2B and B2C businesses.