It’s time to make sure we understand the different types of hardware that are typically used in POS systems. You could write a book about this topic so I’m going to do two things:
- Keep this discussion at a relatively high level (introductory level).
- Split this into two separate blogs.
In this week’s installment, we’ll look at POS’s vs. cash registers, all-in-one hardware, and tablets. We’ll also have a brief discussion about installed software vs. web based systems.
POS hardware can be a consequential long term investment. It is worth your effort to have some basic understanding of their function and their important parameters so that you can make an intelligent purchasing decision.
POS vs. Cash Register
Point of Sale Systems and Cash Registers are both part of your “Cash Management System”. These are the tools that you use to collect and record payments – you need these tools in order to process a sale.
So why would you choose a cash register vs. a POS system? First let me say that this is not a question of one being better than the other – this is a question of doing what’s best for your particular business. Here’s an obvious statement: if you’re brand new and you can only afford a cash register, then buy a cash register!
A cash register will allow you to:
- Collect money from a customer
- Tell you how much change to give back
- Store the cash
- Record the transaction (including payment method, change tendered, etc.)
And that’s about it! If you have a really, really simple business that involves a lot of cash transactions and only a handful of SKUs, then a cash register may be enough.
Here are some things that a POS will do that a cash register won’t:
- Store product data
- Track inventory
- Store customer data (including CRM or “Customer Relationship Management” functionality)
- Provide reporting functions (sometimes very sophisticated reporting functions)
- Loyalty programs
- Gift cards
- “Omni-channel” sales (traditional storefront AND online sales – definitely a future blog topic!)
- Integration with marketing programs
Outside of costs, there are a couple of small disadvantages of POS’s vs. cash registers:
- Cash registers tend to be easier to learn how to use
- Cash registers tend to last a long time because they are such simple machines
- Cash registers are super cheap (oops – I wasn’t supposed to mention costs again!)
So, to summarize, if you’re a brand new business and money is just not there, then a cash register could do the job for you. If your business has any level of complexity (more than a handful of sku’s, uses gift cards, tracks customer names, etc.), it’s worth the extra expense to invest in a POS. It’s worth it just to track customers and inventory.
Custom Computer vs. All-in-one
There is POS hardware and there is POS software. The software is what actually manages all of the transactions and stores all of the data. So, this software ultimately needs to run on a computer of some sort. Broadly speaking, the POS software can run on any computer. It can also run on a system that is designed specifically to be a POS system. You often hear the term “all-in-one” to describe the purpose-built POS computers. The all-in-one’s include a monitor and a computer and they often come with common peripherals like a barcode scanner, receipt printer, and cash drawer.
So when is it OK to use an “ordinary computer” to run your POS and when is it better to use an “all-in-one”? Here are some things to consider.
On March 15th, 2017, I posted a discussion about restaurant vs. retail POS systems. It might be worth your while to take a few minutes to read that first (Click here). A restaurant (food and beverage) POS typically involves a touch screen system. There are different kinds of touchscreens and we’ll get into that in more detail in the part two of the hardware blog. However, the important thing to understand at this point is that POS systems food & beverage operations – bars, quick serve restaurants, and full serve restaurants – take a real beating. There will be lots of fingers pressing on those screens. They will be pressing hard and they will be pressing often. There are touch screens that are designed for these high use environments. You’ll hear the term “industrial” touch screens sometimes. This is what you want if you’re in the world of food and beverage. If you buy all-in-one or purpose-built POS hardware systems, it’s a near certainty that you will be buying a system with a touch screen that’s designed for that environment. (That being said, you should ALWAYS confirm that you are buying a machine with an industrial grade touch screen).
Complete systems are also convenient. You can buy an all-in-one package that comes pre-loaded with the POS software. It becomes an “out of the box” solution. You can pre-load a “normal” computer as well, but they typically require a bit more work to set up than purpose-built, pre-configured system.
So, let’s summarize our conclusions from this section:
- If you’re in the food & beverage sector, make sure you choose a system that’s designed for this demanding environment.
- All-in-one solutions work well in food & beverage environments and are often a better choice as they can be better suited for such harsh, high-transaction volume environments.
Tablets
It’s 2017 and a whole lot of software is moving to web based application. Web based applications lend themselves very well to tablet use. Web based systems that are being operated via tablet lend themselves very well to situations where mobility is important. They are becoming very popular in food and beverage operations for that reason. (More on web-based software below).
Besides portability, tablet systems have some other advantages:
- The up-front costs can sometimes be lower. Quality tablets – which I strongly recommend in a demanding environment – are not cheap. However, it is often less of an investment than a purpose-built all-in-one POS system.
- If the system is web based and designed for a tablet, it means you can access it from your tablet anywhere. It gives you the ability to monitor your operation from anywhere.
- Like any web based system, upgrades happen without needing any help from you.
- It can eliminate the need for customers to queue up at a cash register to pay their bill.
- Tablets add the ability to manage remote events (you can set up food sales at a festival, concert, etc. and all you need to take with you to deal with sales transactions is that tablet).
- Transactions are processed in front of the customer – the server does not walk away with your credit card. That can be valuable in these days of identity theft and credit card fraud.
The downside – most tablets were not designed to take the kind of abuse that they may face in a high-pressure food and beverage environment. One spill on a tablet and it’s likely ruined. One drop to the floor and the glass is shattered (more on glass vs. plastic touch screens in Part II of this hardware discussion).
Installed Software vs. Web Based
Installed software is software that runs on your computer. It resides on your hard drive and not in the cloud. It can access the web just like any computer, but the software is sitting on your machine – not in a data center somewhere. A web based system means that your computer or tablet accesses the software that resides in the cloud. There may be an app on the computer or tablet that allows you to access the software and the data, but none of it is running on your machine. Here are some of the advantages and disadvantages of the two approaches.
| WEB BASED SOLUTIONS | INSTALLED SOLUTIONS |
| Advantages | Advantages |
| Access the system and the data from anywhere | You never lose access to your data |
| No installation is required | You don’t need to be connected to the internet to function |
| The vendor handles all the backups | Everything is usually a little bit faster |
| You can customize an installed solution – this is almost a necessity if you have needs that are very specific to your operation | |
| You are in complete control of your data | |
| These systems are less expensive over time | |
| Disadvantages | Disadvantages |
| You can lose access to your data (internet outage, vendor downtime, etc.) | Remote access is not as easy – it can be done but it’s not as simple |
| Everything can be slower | The software must be installed on every computer |
| Someone else is in control of your data | You must make arrangements for your backups |
| They are usually more expensive in the long run |
As I said earlier, this is a big topic and this was only meant to be an introduction. If you have any specific question, you can always reach out to me directly at joe@scotiasoftware.com.
In the next blog, we’ll get into some details about touch screens and POS peripherals.