A point-of-sale (POS) transaction is what takes place between a merchant and a customer when a product or service is purchased, commonly using a point of sale system to complete the transaction. To see different types of POS systems, click here.
So when you’re at your favorite restaurant or retail shop, and you make a purchase, you are completing a point-of-sale (POS) or a point of purchase (POP) transaction.
Merchants typically use a POS system to complete a sales transaction. In its most basic definition, a POS system is a combination of POS hardware and POS software to create a POS machine for processing a transaction and payment.
Cash registers are not as evolved as using a POS system and lack many of the functions and features of a modern-day point of sale system. A cash register could be considered a point of sale solution technically, however, for our definitions, we will be focusing on point-of-sale machines (aka POS terminals) that involve both software and hardware.
What is a POS System?
A POS system is synonymous with the POS terminal. However, a POS terminal is the electronic equipment performing the sales transaction and processing the credit card payments. Used in most storefront businesses, a computer terminal combined with the POS software helps to manage everyday sales transactions and operations.
Like you learned, with the combination of the POS software and a POS terminal, you now have the full definition of a POS system. A point of sale system is the heart of a business and used for many essential tasks such as inventory management, labor reporting, menu customizations, price adjustments, staff management, sales reporting, customer management, marketing initiates, and so much more. The next time you’re at a restaurant or retail store, ask the clerk what type of system they are using, and you’ll soon learn there are hundreds of different kinds of systems out there.
- Restaurant POS Systems
Why is a point of sale system needed for a restaurant? The primary reason you need a point of sale for a restaurant is to accept cash and credit card payments. In addition to receiving payments, you need to be able to track all your financial and tax data. Most PoS solutions have reporting features built-in to monitor your transactions by date, time, and type. But that’s only the beginning of the awesomeness.
There can be hundreds of features that can streamline your operations and make your restaurant more efficient. For instance, most restaurant POS systems allow you to put in an order and send the request directly to a kitchen printer reducing errors in the kitchen and increasing staff and food prep efficiency. Another benefit would be tracking inventory and food usage. You can also follow payroll with a built-in time clock feature.
The main drawback of new or proprietary business software is there can be a slight learning curve involved when figuring out new technology.
Restaurant PoS Tip Summary: If you’re starting out, make sure your restaurant management system has all the features you need.
2. Bar POS Systems
Although there is software designed specifically for bars, most point of sale systems used by restaurants can also be an excellent solution for bars. A fast, efficient, and reliable bar and restaurant POS system, like Bar & Restaurant, can mean the difference between success and failure in the bar and restaurant business. Particularly for busy bars, your system needs to have speed functions and features for quick order input and fast check out.
The quicker you’re able to process a transaction; you’ll have happier customers and generate more revenue for the business. Most iPad-based systems fall short for bars in this regard because they rely solely on a fast and stable internet connection and internet speed can be unreliable or go down sometimes. Also, iPads can be finicky and require constant updates for the iOS and for the app itself, so carefully consider your options before you put an iPad system in a busy bar environment.
The features to look for in a nightclub or bar system would be bar tab management, customer management, employee management, inventory controls, recipe features, easily reorder drinks, and express check out. For the reporting side, you’ll want to see your labor costs compared to sales, product reports, and all your sales and tax reports.
Bar Pro Tip Summary: If you’re starting out, make sure your restaurant management system has all the features you need.
3. Retail POS Systems
The retail point of purchase (POP) systems is primarily for retail environments. So that means you would most likely never use restaurant software for a retail shop and vice versa.
Some software or Apps on the market claim to be cross-platform, but that doesn’t mean you should ever use them.
Retail businesses can have some particular requirements and features that other programs will not have. They can have retail shop features such as color and size matrixing, inventory tracking, employee commissions, gift registry, customer database, layaway, and purchase orders.
Also, a retail POS system, like Checkout, may include a digital scale or barcode scanner for weighing or scanning items respectively.
Retail technology has developed to such a degree that you can get nearly any report you could ever desire, with the right point of purchase software of course. Specifically look for reports such as detailed sales reports, customer reports, vendor reports, and inventory reports.
4. Small Business POS Systems
A small business point of sale system could come in many shapes, sizes, and flavors. Search small business POS systems online, and you’ll find yourself in the middle of a battle over the latest product of the week because they’re hundreds, if not thousands. Most of the new small business technology is app-based and on mobile platforms.
Remember I mentioned earlier underbar systems, that it’s probably not the best idea to use a cloud-based system? Well, in the case of small business, we’re going to cut tablet apps some slack. That’s because most of the mobile small business systems are designed to be light, flexible, and cost-effective.
If you’re not processing an enormous amount of volume and speed isn’t as critical (like in a restaurant or bar), then a mobile POS could be just the answer to save you some money. Additionally, a lot of these apps can very feature-rich and have everything you need without spending thousands on a “traditional” touchscreen POS terminal.
As examples, an iPad or tablet is perfect for environments like a small retail shop, little restaurant, yogurt shop, boutique store, cafe, or coffee shop. Places where you need quality features and functions but where a cash register may not be enough to get the job done
5. Salon and Spa POS Systems
Nail salons, hair salons, and spas all require a particular set of POS options due to the nature of the business. Options like an online appointment calendar, appointment reminders, customer database with details for a previous haircut or nails styles, retail functionality, inventory management, online employee scheduling, and employee management are all vital to having. So not just any software system will do.
Nail and hair salon POS systems can sometimes crossover for other business types like barbershops, gyms, fitness clubs, beauty schools, massage parlors, pet grooming, tattoo parlors, to name a few. That is because these other business types will especially require an appointment calendar and may need retail functionality with inventory control, and not every software program has those features.
Salon and Spa Pro Tip Summary: If you’re a small salon, you might not need all the features of a more advanced salon software system. You might be able to use something simple and inexpensive like Echo for small businesses. If you have multiple employees and if you do booth rentals, you may want to carefully consider a full-featured salon system like Salon & Spa.