Updated for relevance April 22, 2024.
I’m frequently asked how to select the best point-of-sale (POS) system software. This is important because a POS system for small businesses can make the difference between knowing what's going on and being left behind.
Point of sale systems for retail stores are easy to grasp: they monitor every function of your location and interface with all data around your customers.
The more data you have and interconnect, the more you can do with your employees and merchandise, and the better you can target your customers. That's how you grow your retail sales. I thought everyone understood that...
However, I had breakfast with a group of retailers and asked them what retail software point-of-sale systems they were using.
One sheepishly replied, “None.”
I tried to wrap my head around why a retail store owner would say that. His excuses were everything from not wanting employees to know how much they were selling to fear of new technology to liking the simplicity of just using a cash drawer. Yikes!
From online fulfillment systems to buy online pick-up in-store (BOPIS); from tracking loyalty and employee hours to marketing via text and email messaging.
A retailer can't grow without investing in software and technology. An article by Forbes Advisor found negligible differences between five major POS providers, so it’s not that they aren’t all good. It’s how their offering works for you.
Therefore, the first question you should ask a potential POS vendor is simple: "How can your software improve the efficiency and profitability of our business?"
From their initial answer, you’ll want to ask the following list of questions. And these aren’t just random questions but ones I validated from retailers who wished they’d asked many of them before purchasing their system. They even added some of their own.
Be sure you gauge your prospective new POS provider’s answers using a grading system as you ask these questions.
For example:
A full-featured POS system can show you the busiest times of your week so you know how to schedule.
With robust reporting features, you can understand your best-selling items and those that are not. You can also learn the percentage of customers who are new versus returning.
But remember, reports are only good if you use them. You want the information you need most to be automatically emailed to you each week so you can spot trends and opportunities in both merchandise and employee performance.
These are the questions to ask in this area:
A big component of any POS system is how they take care of you after the sale – not the sales representative’s initial pitch. You don’t want to call support to get the information you want. So ask these questions:
A great POS system will collect data into a Customer Relationship Management Program (CRM) so you can interact with customers continuously.
Being able to send emails or text messages has become imperative for brick-and-mortar retailers looking to compete with online retailers. Ask these questions:
POS systems in the future will simply read RFID tags embedded in each item, so associates cannot change item prices on their own. You will also have a reader which scans the store in a few minutes and inventories the complete store.
Until then, you’ll want to do as little as possible to maintain your inventory. Questions to ask here are:
Remember that your POS’s first function is still to function as a great register. The days of a separate credit card machine are over. Your new POS should be able to integrate with your credit card processor so all data can be tracked and recorded.
Ask these questions:
Finding the right POS system for your needs is not easy, and there are many variables.
Expect to pay for convenience and intuitive interfaces as well as additional services. However, like retail sales training, I don’t see the purchase as a cost but as an investment.
No one system is perfect right out of the box, but the more confident you are about your business future, the more you will look for new tools you can use to engage your customers more often and in a higher, more personalized manner.
Everyone has an outside passion apart from their job. You know well-made tools make your passion, whether building, gardening, or cooking, more efficient.
A fully featured POS system capable of mobile payments and sophisticated CRM tools can help you better understand your customers, stay on top of your inventory, and make more money by avoiding out-of-stock and database errors.
Much like when looking for a new doctor, many people rely on their contacts for a recommendation before jumping in to find a new one. POS systems can be overwhelming in terms of the breadth and depth of their abilities, and your eyes can glaze over quickly.
The world of POS systems is dominated by some big players who usually lead the developmental charge. Here are some service providers you might be interested in checking out in no particular order:
And if you are looking at LIghtspeed, you'll want to check my affiliate link here to get special bonuses.
Make this an essential part of your retail management strategy. Do some quick research, decide on two you want to check out and use these questions as you balance the features you need with the cost and convenience you want.