A point of sale (POS) system is one of the most crucial pieces in your operation puzzle. The importance of POS system in retail goes beyond managing transactions at your checkout counter. Today we’ll look at the 7 reasons why you need a POS system for your retail business.
Optimize the checkout process
A POS system speeds up your checkout process significantly. By having a centralized database of your products, pricing, and customers, you can quickly find the products, assign the order to a customer, and apply discounts with little effort.
If you’re using a barcode scanner, the process is even faster.
Customers never want to wait in queue for long to complete their purchase. With the help of an efficient POS system, you’ll reduce the chance of customers leaving your store without a purchase.
A fast and convenient checkout is one of the many benefits of a POS system. It can be a winning point in your customer’s eyes, keeping them loyal to your brand.
Provide more payment options
Payment technology has changed significantly in the past 5 years and retailers are under great pressure to adapt to these changes, hence the importance of POS systems.
In addition to cash and credit card, customers can request to pay with eWallet, in installments, or they may want to combine different methods to pay for one order. With a flexible POS system, you can offer more payment options for your customers and make sure they complete the purchase with a good impression of your brand.
Offer discounts that benefit you and your customers
A POS system is important because it gathers all your data on sales, inventory, and customers. With this information, you can calculate and run marketing campaigns that encourage customers to come to your store while maintaining your bottom line.
Depending on your POS capabilities, you can set up flexible promotions based on items, order amount, membership tier, and more. Then the POS can apply these promotions automatically on any sales, saving you the time and effort to calculate everything manually.
Run loyalty programs
In addition to promotion, running loyalty programs is a guaranteed method to attract new customers and increase repeat purchases. Integrating programs such as membership or gift vouchers into your POS makes sure your customers are rewarded for every purchase without extra work for your staff.
An advanced POS system can go one step further and display loyalty program information to encourage customers to purchase more. For example, your customer can see how many points they have or how much they need to purchase to qualify for free gifts.
The needs for a centralized customer database is one of the reason why many Magento merchants chose Magestore POS.
”That’s so important to us to have an omnichannel experience and share customer data across the entire system that a lot of the other solutions didn’t have.
I just believe in this solution and I’m really excited about the future with it. I think that Magento is one of the big players. I really believe in the direction that Magento is going. I really believe in Magestore.Matthieu, Store Owner of Upper LimitsE-cigarettes | United States
Eliminate human errors
If your staff is manually entering the products and prices, there’s a high risk of error, especially if they have to handle a high number of transactions every hour.
Another benefit of POS is that it ensures you’ll always have the correct product SKU, consistent prices across your system, and correct order amount at any time. All sales order data is recorded into your POS system, making it easier to go back and review the information if necessary.
Reduce your losses
Intuit Market Research showed that retailers with revenue of $300,000 can cut costs by close to 10 percent or $30,000 a year.
One of the biggest problems many retailers struggle with is inaccurate inventory. These losses can be quite painful to absorb if you can’t get to the bottom of the issue.
Keep good records of your inventory is an effective solution. By knowing how much stock you have in your store and where they are, you reduce the risk of misplaced or stolen inventory and have the ability to take action quickly.
A POS system is also important because it provides you with accurate financial information. You can track how much cash you have in your cash drawer as well as your profit and cost at the end of each day and month. If your POS is integrated with your accounting software, your finance department can access the information for accounting activities with ease.
Manage your employee
Coordinating and managing employees can be tricky if you’re using separate worksheets.
A POS system helps you keep track of who worked each shift. An advanced POS system can even provide you with reports on the sales performance of each staff and calculate the commission rate.
This helps you keep track of each staff’s progress towards their goals and decide how to support or reward them.
What is a point of sale (POS)?
Point of sale is the place where all the transactions take place within a retail store, between the salesperson and end-user. Depending on the type of retail system utilized by the business, a POS may include both hardware and software to complete transactions, ranging from cash drawer to receipt printers and more.
What is a point of sale terminal?
Point of sale terminal describes the hardware system that processes card payments at retail stores. The latest POS terminals are capable of not just reading the magnetic strips of credit cards, but also handling contactless payment and mobile wallets.
What are the features of POS software?
The most common and prominent features of any POS system include:
- Sales management
- Inventory management
- Employee management
- Analytics & reporting
- Loyalty programs and offers
- Marketing integrations
To sum up
The retail landscape is changing more and more rapidly, and you wouldn’t want to get left behind due to manual and outdated systems. It’s time to understand the importance of POS systems and consider an upgrade to your operations.
If you’re a Magento merchant considering different POS providers, grab a free copy of our Magento POS system comparison chart to save you research time.
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Join the discussion 4 Comments
Hey there, good to read this article. Indeed, The modern POS software helps the retailers to work efficiently along with taking smarter business decisions with quick and easy implementation of the same. Also, the real-time dashboard of the POS system gives access to all the important links of the business unit from a single place with few clicks. This is a clear and understandable post. Very well-written article.
Your blog is an incredible resource for anyone who wants to start their own business. I’m so glad you shared your knowledge with us, it’s helped me out a lot!
It’s valuable that you elaborate on how utilizing a POS system at your retail business can help reduce the loss of the business’s money. My wife and I want to open a small store together this year, so it sounds like we’ll want to purchase a good POS system for it. I’m going to look for a reputable business in our area that can sell us a POS system.
All the above-mentioned points are so relevant. I started reading about these things a while ago when me and my brother were preparing to open our own restaurant.