What Is a Point of Sale (POS)?
Point of sale (POS), a critical piece of some extent of purchase, refers to the place where a customer executes the payment for goods or services and where sales taxes may become payable. It is often during a physical store, where POS terminals and systems are wont to process card payments or a virtual sales point like a computer or mobile device.
Understanding POS
Points of sale (POSs) are a crucial focus for marketers because consumers tend to form purchasing decisions on high-margin products or services at these strategic locations. Traditionally, businesses found out POSs near store exits to extend the speed of impulse purchases as customers leave. However, varying POS locations can give retailers more opportunities to micro-market specific product categories and influence consumers at earlier points within the sales funnel.
For example, department shops often have POSs for individual product groups, like appliances, electronics, and apparel. The designated staff can actively promote products and guide consumers through purchase decisions instead of simply processing transactions. Similarly, the format of a POS can affect profit or buying behavior, as this provides consumers flexible options for creating a sale.
Amazon’s concept shop, Amazon Go, which deploys technologies that permit shoppers are available, grab items, and walk out without browsing a register, could revolutionize POS systems. Besides increasing convenience, this might enable POSs, loyalty, and payments to be rolled into one customer-centric experience.
Benefits of POS Systems
Electronic POS software systems streamline retail operations by automating the transaction process and tracking important sales data. Basic systems include an electronic register and software to coordinate data collected from daily purchases. Retailers can increase functionality by installing a network of data-capture devices, including card readers and barcode scanners.
Depending on the software features, retailers can track pricing accuracy, inventory changes, gross sales, and sales patterns. Using integrated technology to trace data helps retailers catch discrepancies in pricing or income that would cause profit loss or interrupt sales. POS systems that monitor inventory and buying trends can help retailers avoid customer service issues, like out-of-stock sales, and tailor purchasing and marketing to consumer behavior.
KEY TAKEAWAYS
- A point of sale (POS) is a place where a customer executes the payment for goods or services and where sales taxes may become payable.
- A POS transaction may occur in person or online, with receipts generated either in print or electronically. Cloud-based POS systems are becoming increasingly popular among merchants.
- POS systems are increasingly interactive, particularly in the hospitality industry, and allow customers to place orders and reservations and pay bills electronically.
Special Considerations: POS Innovation
Modern POS systems are commonly programmable or allow enhancement with third-party software programs. These systems are often tailored to satisfy specific needs. for instance, many retailers use POS systems to manage membership programs that award points to frequent buyers and issue discounts on future purchases.
Cloud-based POS systems are increasingly in use, particularly for giant online merchants, to trace and process numerous purchases. Cloud-based systems can greatly reduce the upfront costs of implementing a POS system for several businesses.
Customers also can interact directly with POS systems, particularly within the hospitality industry. Often mentioned as location-based technology, these systems can process transactions at customer locations. for instance, at many restaurants, customers can view menus and place orders on terminals located at their table. In hotels, customers use similar terminals to put orders for room service or to pay hotel bills.
To stay competitive and aid brand owners in promoting their products, POS display manufacturers are focused on improving aesthetics and creating innovative product designs. Also, the intensifying competition within the retail industry and the resulting use of POS displays for enticing customers to get products have encouraged retailers to demand different custom-made displays capable of serving specific needs across different retail facilities. Customization offered in terms of aesthetics, capacity, and mobility can greatly impact a company’s brand identification.
