A POS machine means Point-of-Sale Terminal, which is a hardware used to process card payments. It is a great way to process customer and vendor payments via multiple sources and record those. POS Software is embedded in the hardware to read magnetic strips of credit and debit cards.
Last Updated on : 02 Aug, 2021
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A POS machine is a great way to process customer and vendor payments via multiple sources and keep a record of those. While some businesses work entirely on the basis of detailed purchasing contracts with vendors, others have to manage transactions individually.
The point of sale machine is a combination of tools that enable you to streamline all business processes associated with sales. Further, the setup of the POS machine at your store is likely to vary from others depending upon the payment methods you accept and the way you record sales. They need to deal with cash, cheque and card payments on a day-to-day basis to make and record sales.
If we get back to the basics, a Point of Sale machine is a computerized replacement of cash registers, as store owners can manage their sales & transactions electronically.
Both new and established businesses chose to invest in a POS device to boost efficiency. Advanced reporting and sales transaction features make the system totally necessary for any business which has to manage transactions, contacts and inventory items. Retail merchants and owners of restaurants, supermarkets, pharmacy or any other store view it as the one-stop solution to manage online and face-to-face payment.
A store may have one or more POS terminals depending upon the need. Usually, every Point of Sale terminal consists of a receipt printer, a card sweeper, a barcode scanner and a cash drawer. All Point of Sale terminals is connected to a single server, creating a central record of all transactions occurring at a store. There is almost an endless number of equipment that can be added to a point of sale terminal to meet your store’s unique needs. Once the POS device has been set up in combination with all essential tools, the person managing the check-out counter just has to scan an item and all related data will be stored automatically at the main server. Also, the price of every item starts reflecting on the screen as soon as the price tag is scanned via a barcode scanner. The inventory status of your store can also be updated automatically when an item is sold, exchanged or returned.
The point of Sale systems consists of different components and hardware which work together towards ensuring smooth sales transactions and inventory control. You can buy different POS hardware individually or in combination. Here’s a guide to understanding the functions of different POS components.
A Barcode scanner is a flat glass placed near the cash register, which is used to capture the bar code of every item with a laser beam. Most of the bar code scanners are handheld, allowing the counter person to scan every item conveniently irrespective of their size or weight. A bar code scanner is a handy tool for tracking inventory status as well. It deciphers the information about every item and updates the inventory database on POS software.
The cash drawer is an essential peripheral of any card swipe machine. It is where cashiers often store receipts, notes, coins, and other paperwork. While buying the POS software, look for a sturdy option that can withstand constant opening and closing. Also, it should not open manually but when programmed to open via digital commands. This is important to prevent pilferage at your store.
You have different options for the POS printer, such as serial dot-matrix printer and thermal printer. Serial dot-matrix printers usually cost less initially but Bluetooth thermal printers are faster and quitter to use. Whichever model of POS printer you choose, make sure that related supplies like receipt paper or printer ink and ribbons are always in stock.
POS label printers are used to deliver labels and barcodes on demand. Merchants across different industries, such as food service, manufacturing, and pharmacies use a POS printer for ticketing, source labeling and more.
Though it’s optional, customer pole display is a great way to ensure transparency in transactions. Customers can view transaction totals along with the amount offered. You can also feed customized messages on the customer pole display, depending upon your store needs.
POS computer or CPU is the main component that runs the POS machine. Your POS computer can either have a standard operating system or pre-loaded proprietary software to run the machine. Higher the processing power of your CPU, the faster will be the transaction speed.
Some signature capture devices work well with credit and debit cards along with gift cards and other loyalty programs. Using the card swipe machine, you can make transactions more streamlined and reduce the costs associated with unnecessary paperwork.
When it comes to the POS monitor, you can opt between Flat-panel LCD monitor and CRT monitor. However, LCD monitor consumes less space compared to the other option.
If you have not opted for the POS monitor with a touchscreen facility, you need to buy a keyboard. POS keyboards vary in terms of complexity and features, with some of them coming with special functions. Depending upon your store needs, you can buy the standard 101-key model or industry-specific POS keyboards.
Are you still in doubt about investing in the latest POS machines? Here’s a list of POS functions that will propel you to invest right away.
POS machines help in eliminating any unnecessary step in data entry and makes all sales-related data available at your fingertips. With streamlined reporting, every information will be readily available to make decision-making easier. Also, sales transactions through all possible mediums, be it net banking, card payments or via cash can be tracked and managed with the POS machine. So, no transaction detail will fall through the cracks, as details related to item price, discounts, mode of payment, etc. will be stored at one location.
POS device also helps in staying up-to-date with the current inventory level in your store. You can monitor the orders coming in and the sales going out so that your inventory level is up-to-date. This can also help in saving costs by ordering products only at the time when you need those at the store, considering the current sales statistics. With the ‘Just in Time’ ordering pattern, your cash will no longer be tied in excess inventory.
POS machines can be useful in physical inventory management too. You can count the items in your store physically and compare it with your perpetual inventory status available on the POS machine. This way, you can better track lost or misplaced products.
With a dynamic payment gateway, you can accept payments through credit/debit card at your store. Also, transactions can be performed across websites and mobile applications, ensuring faster and hassle-free payment with complete ease for the customers.
There is more to a successful business than managing transactions. It’s about fostering a relationship with customers and a POS machine can help with that. POS system allows you to track the purchase history of your customers and predict what new products might appeal to them. Also, customers’ purchase history assists in identifying their needs, and you can design loyalty programs accordingly to ensure repeat visits.
Mobile Point of Sale: Mobile-friendly POS machines enable collecting payment from customers at your store directly via mobile. Just ensure that your POS device adheres to the EMV (Pin & Chip) guidelines and PCI-DSS standards to promote transactions via net banking, Visa/ Master cards.
The POS machine’s functions are not confined to managing transactions. It can also be used to handle other complex tasks in the hospitality sector like printing tickets for the kitchen crew in restaurants and tracking serving tips, catering charges and so on. Also, you can set recipes for standard dishes, and as soon as an order for a dish is placed, you will get to know how it affected your ingredient level.
Q1 - Do I need a website to accept payments online?
A. If you have an online identity, accepting payments through cards and net banking would be easier. However, if you don’t have your own website yet, you can still accept payments online through mobile POS solutions.
Q2 - Do I need technical knowledge to use online payment gateway?
A. Any online payment gateway has quite a simple interface and is easy to use. Additionally, you would get free assistance from your vendor to address any query you have while using the product.
Q3 - How do I check transactions done through the POS terminal?
A. You will get login credentials to access the merchant interface on your Point of Sale terminal, where you can view transactions, orders, returns along with day-wise sales summary and reports.
Q4 - How soon will I get money in my bank account for transactions done via POS machine?
A. With most of the POS terminals, you are likely to get money in your bank account within two working days from the date of order reconciliation.
Q5 - Can I hold payout for a few days if there is some issue with my bank account?
A. Yes, top POS terminals allow you to hold the remittance to your merchant bank account until you send the instruction to release the payout. However, you need to check with the vendor if this facility is pre-built or available on demand.
Q6 - Can I cancel or refund any transaction made via POS machine?
A. Yes, you can process refund to the customer’s account even after a successful transaction is done in your merchant account. It usually takes 5-7 working days for the refund to appear in the customer’s bank account.
Q7 - Will I get email with details of transactions done using POS terminal?
A. Yes, POS terminals usually provide email for every successful transaction processed. Also, you can get order email alerts to ensure that you don’t miss out on any transaction detail.
Q8 - Looking to upgrade POS machines at your store?
A. Don’t take the selection process lightly, else you will end up investing in POS machines which fail to maximize your investment. Here’s five things to consider before buying POS machines for your store. POS machine price would be on your mind for sure, but there are other important factors to consider. While asking for the POS machine price, also raise these questions.
Q9 - How many transactions are likely to occur at your store daily?
A. Higher the processing speed and power, the lesser will be the time taken in completing each POS transaction. If the traffic at your store is higher, go for a POS terminal with CPU of 2.0GHz processing speed. If there is medium or low traffic at your store, you can opt for the CPU with average processing speed.
Q10 - What types of payments you plan to process?
A. Depending upon the types of payment accepted at your store, you need to select the POS terminal. If you accept payments via debit/ credit cards, look for an EMV-compliant POS terminal which complies with the Europay/MasterCard/Visa (EMV) standard. As, you are liable for fraudulent card transactions at your store, so ensure that the POS terminal is compliant with the latest rules. Near-field communications (NFC) technology is also gaining momentum these days, and can be useful for your customers through contactless payments and mobile wallet services.
Q11 - How many POS stations your store have?
A. You will need one POS terminal for each station for a transaction. If there is space constraint, you can opt for a POS device with integrated peripherals like printer.
Q12 - How ‘harsh’ is your store environment?
A. Depending upon the hours of usage and environmental conditions, you need to opt for POS equipment accordingly. Your POS terminal and its peripherals should be able to withstand the operational setup at your store to help you maximize your return on investment.
Q13 - Do you have any plan of store expansion in the near future?
A. If you plan to expand your store operations in the near future, you need a POS machine that grows with the business. Opt for a POS machine which is scalable in terms of its different components and capabilities. It’s important that the machine fulfils your expanding business needs.