Tap and go payments today are a far cry from tills springing open with a ring, or from swiping a card. The point-of-sale experience has become a vital component of a brand interaction.
The online customer experience has surged ahead due the urgency for digital shopping solutions created by the pandemic. The challenge now is for small businesses to match that digital experience with the one provided in store. A point-of-sale (POS) system might help do just that. More than just a payment gateway, a POS system can integrate with customer data, loyalty programs, inventory and more to function as a critical part of the customer journey.
So how can small businesses best navigate the myriad POS options now available and are they worth the investment for your small business?
What is a POS system?
A POS system is made up of both the hardware (think of the card reader machine you tap your card against or the digital cash register on the counter) and software required to conduct transactions. It can take payments in various forms – cash, credit cards, gift vouchers etc – incorporate any discounts, refunds or change, and provide a receipt for the customer.
So far, so simple. Making payments for a product or service is what most of us associate with a POS system.
But today’s POS systems can incorporate much more.
Ditch paper receipts
Many customers will welcome the option of having their receipt emailed or texted to them instead of keeping track of a small paper receipt. This is a win for businesses too because they can do away with the fuss of replacing receipt rolls and instead provide their customers with a customised and personalised receipt in digital form.
Build loyalty
Loyalty programs are becoming an increasingly popular way to attract customers and create brand advocates so if your small business has a loyalty program or is considering one, a POS system that incorporates it could be advantageous. Whether it’s points based, tiered or ‘card stamped’, the right POS system can streamline what is otherwise an often cumbersome and paperwork-heavy program.
Streamline inventory management
If a high turnover of inventory is essential to your small business, it might be worth considering a POS that integrates with your inventory records and prompts a reorder when stock gets low.
Know your customer better
Some POS systems have a customer relationship management (CRM) feature that allows you to capture customer data and activate it to provide a better customer experience. This could include contact information, purchase history, seasonal preferences and feedback or complaints.
Get industry-specific solutions
Hospitality businesses like cafes and restaurants, can choose a POS system that includes table management, self-serve ordering and kitchen display systems while a hairdresser or beauty therapist might benefit from a POS that has a booking system.
Simplify reporting
A POS system can generate reports from myriad data including customer purchases, inventory and sales campaigns so you can get the insights you need into your business performance and forecast accurately for the future.
Does my small business really need a POS system?
If you want to accept credit card purchases and keep track of transactions, it’s probably a good choice to invest in a POS system suited for small business. The challenge is to choose one that’s right for your business needs, which involves making decisions about how your business might scale in the future and what POS features you’ll need to accommodate growth and change. If the bells and whistles of the newer POS systems are not necessary for your business, go with a simpler option.
How do I choose the right POS system for my business?
- As with any investment in new technology, you want to be sure it meets your needs so be clear about what you want to achieve before making your decision.
- A POS system can be a lot to get your head around, so find out what training is included – your staff will need to be up to speed also. Is there someone you can call directly for assistance when you need it?
- Understand exactly what costs are involved including any on-going fees, and what is included in your package.
- Choose a reputable vendor who prioritises security and service and is PCI compliant (Payment Card Industry Data Security Standard Compliant).
- Make sure the POS can be integrated with any existing technology and is supported by your financial institution.
Are there any downsides to a POS system?
We’ve all been that customer standing at the counter, waiting for the card reader to reboot or find a signal. Small businesses should be prepared for those kinds of hiccups. Rural and regional small businesses might face higher costs associated with getting terminals and training as well as challenges with network connectivity.
Security can also be an issue because of the potential for cyber attacks. Features such as up-to-date encryption, multi-factor authentication and the right staff training can help reduce this risk.
Finally, cost – upfront and ongoing – will be a big consideration for small businesses.
Recent YouGov research commissioned by Prospa shows 23% of small business owners and leaders are planning to invest in digital technology and the same percentage are planning to upgrade or purchase new equipment in 2023. A well-chosen POS system could be a critical element for small businesses looking to up their digital game when it comes to the in-store customer experience.
