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What is a POS system? The Complete Guide to Point of Sale
You can sell online, in-person, or both. An efficient point of sales (POS) system will help you manage your business efficiently by unifying all of your sales, business operations, and marketing efforts in one place.
You will need to manage an eCommerce store. This means that you’ll have to do everything from marketing to inventory management, sales reports preparation, and even inventory management. A sophisticated POS system will save you time, especially if you own an online shop as well as a brick-and mortar location. It will also allow you to grow your business.
Point of sale (POS) is the meaning behind this term
Point of sale (or point of purchase) refers to the point at which a customer purchases an item and makes payment. Customers can reach your counter or visit an online checkout to make a purchase. Or they may pick up an item at your booth at a festival or pop-up.
What is a POS Transaction?
In simple terms, every time a customer purchases a product or services, they are completing a point-of-sale transaction. This is when you make the sale. You create a digital or printed receipt and ship the goods to your customer.
What is a POS system, you ask?
A POS system used to be a cash register in a store. Modern POS systems can be accessed anywhere you are, and you can even check on a customer from your mobile device.
A POS system calculates the cost of an item including sales tax and updates your inventory to show that it has sold. Advanced POS systems can do more than just calculate the price of an item. They also serve as the hub for business operations that handle many important tasks, such as customer management, sales, inventory, and reporting, price adjustments, and other essential tasks.
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There are many types of systems available. Knowing the basics of a POS system, including its software and hardware components, will help you make informed purchasing decisions that meet your needs.
What is a POS system?
A POS system combines hardware and software to sync and track all sales, inventory, payments, and other information, regardless of whether you sell online, in-person, or both.
The following are typical hardware parts:
- Cash register
- POS terminal, such as a tablet, iPad, Android tablet, or mobile app
- Barcode scanner
- Credit card reader
- Cash drawer
- Printer for receipts
POS software keeps track of all transactions and can, depending on which POS system you choose to use, include the following features.
The software and hardware combine to create a powerful tool that allows your business to run daily operations more efficiently, save you time, and give you insight into customer behavior to help you predict trends.
What are the key features to be aware of?
It’s crucial to consider which software capabilities and features are available when choosing a POS system for your business. Below is a list of features you may find in a POS system. This will help you narrow down your search based on your business requirements.
- Payment processing:Payment Processing is a core feature of a POS system. Your POS system processes every customer’s purchase. A POS system can accept a variety of payment options, including cash, secure online payments through an eCommerce site, magstripe cards (cards you swipe), chip card, contactless payments (e.g. Google Pay or Apple Pay), as well as card-not present transactions. This is when you manually enter a customer’s credit card information. When a customer checks out online, they may also enter their payment details.
- Data Entry:POS systems reduce the time it takes to enter customer and product data. Usually, your data can be imported en masse when you purchase a POS system. This makes it easy to find your customer or product database quickly.
- Inventory Management:Keeping track of your products across all sales channels (in-store or online) is one of the most important functions a POS system can perform. This allows you to know when it’s time for you to place orders. Your POS system should enable you to digitally count and scan products, identify individual pieces of inventory with a serial number, track inventory levels across different locations, consolidate orders and purchases, and keep track of product variations (size, colour). Some POS systems provide an alert system that notifies you when stock is low.
- Sales reportingRunning Reports are a must-have. They give you a quick overview of how much you’re making and selling, and help you make better business decisions.
Many POS systems allow you to view sales data and generate reports. It is important to remember that POS systems can access different types of data and provide different levels of detail. Your POS system should be able to generate detailed sales reports, based on total cost of the items sold, profit, and other information, and also provide charts and snapshots about how your business is performing. These reports should be available for automatic transfer to other accounting software.
- Customer management and marketing: A POS should have a customer relation management ( CRM ) tool to track all customer data. You should be able to keep track of your customers’ purchases, capture customer information like name, age, birthday, and phone number, and use email marketing for customers. Tracking customer purchases can help you design personalized marketing strategies. Advanced systems can also create loyalty programs. Wix Ascend integrates seamlessly with Wix POS to collect email addresses at checkout and to offer loyalty points (online as well as in-store) using the right Wix Market integration.
- Employee reporting and management:Team Management software allows you to see when your employees are at work and what their performance is. You should be able to add employees, modify and create schedules, track overtime hours, and analyze performance. This information will help you to set sales goals and provide insight for employee coaching. You can use the POS system for clocking in and out. Some software may grant permissions to employees to access certain tasks.
- Order history & Receipts:Receipts simplify the process of processing refunds. They allow you to attach a digital or paper trace to your order. POS systems can do more than just print receipts or generate receipts. All purchases are taken from inventory and entered in sales reports. All markdowns or discounts should be reported to reports and in your customer management system. These data will help you develop more efficient business strategies for the future.
- Cloud & Mobile: A cloud-based POS system stores data on the cloud. Cloud-based systems don’t typically store much information on your terminal device. All data is instead stored in the cloud, and synced across multiple terminals. Cloud software has the advantage of being free from costly on-site servers. It is typically available as an app for mobile, iPad, or Android tablets.
Which POS system is best for you?
In the past, your eCommerce website and brick-and-mortar store didn’t always have a common POS system. This made it more difficult to manage business operations such as inventory tracking, customer behavior, store credit and return management. Modern POS systems can integrate all aspects of your business, online or offline. There are many options available to choose the right combination of software and hardware that best suits your business. If you own a retail store that sells in brick-and-mortar locations and accept payment online, you will want a retailPOS system that integrates all of your sales. You can also opt for a mobile-POS system if you sell at events and pop-ups. This allows you to accept credit cards on the move.