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Whether you are setting up a retail business for the very first time, or you are an experienced merchant, having the right POS is essential for your success. Your POS, or Point-of Sale system is the central component of your business, and much more than j

24th Nov 2020 | Retail

Learn what features to look for when choosing the best retail POS system for your company.
A retail point-of-sale (POS) system consists of POS software and hardware that enables retailers to ring up customer orders, record payments and perform several other operational tasks.
When choosing a retail POS system, look for essential features like inventory management, employee management, real-time reporting and retail-centric features like customer management, loyalty programs, and matrix inventory tracking.
To get the best deal on your retail POS system, look for companies that offer month-to-month contracts and open-source POS hardware.

There are hundreds of point of sale (POS) systems available to small businesses, and several are geared toward retail businesses specifically. However, choosing the best POS system for your business requires careful analysis and consideration.

The best retail POS system for you depends on your business's size, your budget, the features you need in a system and your preferences.

What is a retail POS system?
A POS system comprises both POS hardware and software. You can work with a provider who offers everything you need (software and hardware), or you can pair the software with hardware you purchase from third parties.

Editor's note: Looking for the right POS system for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.

Retail POS software
Retailers have the option of using local, server-based POS software, which stores sales data onsite; however, the best programs are either app- or cloud-based SaaS solutions. Using a cloud-based solution is common among retailers since it allows them to view sales data online in real time. Additionally, cloud-based retail POS software is typically more affordable, which is especially ideal for retailers who have several locations or who are on a tight budget.

Regardless of whether you choose cloud-based or local, server-based POS software, make sure the system is compatible with your payment processor and has the add-ons you require.

"Shop around with different providers to see what works best," Jared Weitz, founder and CEO of United Capital Source Inc. told business.com. "I suggest driving your POS setup around the software and finding hardware that will be compatible with it. Think of the software as the brains of the POS – you want it to be as tailored to your business needs as possible."

Retail POS hardware
When selecting a retail POS solution, consider the type of hardware you want to use and what will be the most practical for your store. POS hardware can be a stationary terminal or a mobile device, such as a tablet or iPad. Many small businesses prefer mobile POS hardware since it is typically less expensive and offers more flexibility.

"[If] your store has multiple locations or attends pop-up events, having a mobile POS available for fast checkout is going to drive your business even further," said Weitz.

Although each business is unique, the typical POS hardware you need for your retail business includes a tablet and stand, cash drawer, barcode scanner, and receipt printer. Additionally, you may need a card reader or credit card terminal.

Some POS software providers have proprietary POS hardware that you're required to use, while some providers let you use third-party hardware components. There may be specific brands and models that are only compatible with the software, though.

What are the essential features of a retail POS system?
Sure, you can purchase a POS system with basic features like inventory management and data recording or a more robust solution, but make sure your system has these essential features:

Payment processor compatibility
Product matrix, inventory tracking and purchase ordering
Data recording, reporting and analytics
Customer management and loyalty programs
Employee management (function, data access and time tracking for payroll)
You also want a system that integrates seamlessly with your accounting and marketing systems. Having an integrated system that automatically shares data will simplify your business operations and reduce the risk of human error.

How much does a retail POS system cost?
With POS systems, you'll be purchasing software and hardware. And with hardware, you'll need to decide whether you want to lease or purchase it.

Industry experts recommend buying POS hardware; leases often come with lengthy, noncancelable contracts and specific card processing requirements that cost you more money over time. Another benefit of purchasing hardware is that you may not need to replace equipment if you find a better deal later. Another factor that determines how much you'll pay for hardware is whether you use a legacy terminal or a mobile POS system. Mobile POS systems are always less expensive, especially if you already own tablets.

Choosing retail POS software that is cloud-based, as opposed to a local server-based, can save you money too. Month-to-month terms are preferable, as they allow you to cancel without penalty, but if you're confident that you'll be happy using your system for a year or more, you can often prepay annually for your software and receive a 10% to 20% discount.

By: Skye Schooley