Introduction of Point of Sale System for Small business
There’s still confusion among people about what is a POS! A point of sale i.e. POS, is a central location for sales transactions and inventory and staff management. It is software and hardware where a customer makes a payment for goods or services at your marketplace. Whenever the customer makes some purchase, they are completing a point of sale transaction.
Simply put, the point of sale is a center for retailers to run and expand their business. Administrative, marketing and management skills are necessary to operate a retail store smoothly. A point of sale system ensures that there’s enough tally to merge sales, inventory management, payment processing, and customer-staff management.
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How does a POS System work at a small business?
The point of sale (POS) system makes it possible for your business to accept payments from your customers and at the same time keep track of sales for you. This might sound easy to you but the setup works in different techniques, depending on which method you are using, i.e. online store or physical store, or both. In this modern era, POS systems are completely digital, which gives you the flexibility to check data wherever you are. You just need a device like a tablet or phone with internet.
Steps to how a POS system works
- Firstly, the customer decides which product/service they want to buy. In a physical store, they may ring up a sales associate to know the item’s price. For which, the associate can use a barcode scanner and if there is a square POS system, they can use a phone camera for the same. In a online store, this step happens at the time of checkout.
- Then, the POS system process to calculate the cost of the products/services including any taxes. After that it updates the inventory count to indicate that the product is sold.
- Now, to finish up the purchase made, your customer pays using their debit card, credit card, gift card, tap card, loyalty points, UPI or cash. The customers’ bank then has to authorize the transaction according to the payment method they chose.
- Finally, the point of sale (POS) transaction is settled. And this is the step where you officially make a sale. The payment is made, then a printed or digital receipt is created and finally you hand-in or ship your product to your customer, which they bought.
Benefits of POS System
Point of sale system has become an essential part of the retail market and restaurant industry. Electronic cash registers and daily purchases data help retailers in increasing functionality. Several other features can also be included in it that allows them to track price accuracy, gross revenue, sales patterns, inventory changes etc. A network of data-capture devices, including card readers and barcode scanners can also be installed. Below are some of the benefits and advantages of POS systems:
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It’s versatile and hence can be used to/for:
- Accept payments
- Customer insights
- Track inventory
- Planning and analytical thinking
- Facilitating personal client communication
- Menu optimization
- Data security
- Financial reporting analytics
- Increase the business’ efficiency
- Staff control and management
- Loyalty programs