Operating a retail store requires a
range of administrative management and marketing skills, which can range from
putting together monthly sales reports to regulating inventory to run business
smoothly. Having an efficient and reliable point of sale (POS) terminals make
running business a little less overwhelming as they are modern and easy-to-use
solutions to facilitate a store’s necessary operations. A POS system,
synonymous with POS Terminal, can help to reduce paperwork, track inventory and
market to your customers, which gives more time for the store owners to manage
business rather than getting into details.
Point of Sale (POS) Terminal
is an electronic payment processing system that enables customers to make
transactions for goods and services at the time of checkout. POS terminals are
extensively used in industries that have a point of sale such as a service
desk, including physical retail stores, restaurants, lodging, entertainment,
and museums. The network mainly consists of a main computer linked with several
checkout terminals that are supported by different hardware components. The
basic hardware features in POS systems include POS display, barcode scanner,
receipt printer, payment terminal, and cash drawer.
·
Barcode
scanners scan billed
items
·
POS
display unit shows
billing
·
Payment
terminal allows
cashless transactions through debit card, credit card
·
Receipt
printer prints the
receipt
·
Cash
register stores cash
generated from sales
US Market Overview- Point of Sales
Terminal
In 2018, North America held the largest
market share of 22.23% in global POS terminal system, out of which United
States accounted for the more than 75% share, according to TechSci research
report. The growth can be attributed to booming cashless economy in the region,
which has accelerated the adoption of POS systems, especially in retail and
hospitality industries. The technological advancement in the payment industry,
and greater focus on offering customized business specific solutions and EMV
compliances in the region is expected to enhance POS terminal market in the
region.
According to TechSci research report on “Global
POS Terminal Market By
Product Type (Fixed, Portable & mPOS), By Deployment (Cloud &
On-Premise), By EMV Compliance (EMV & Non-EMV), By Industry (Retail, Travel
& Hospitality & Others), By Region, Competition, Forecast &
Opportunities, 2026”, Global
POS terminal market is forecast to exhibit a CAGR of more than 9% during the
forecast period of 2021-2026, growing from USD15 billion in 2019, owing to
increasing use of Europay, Mastercard and Visa (EMV) cards. Point of sale (POS)
terminals are used for handling payments and checkouts. Modern POS terminals
integrate multiple systems into a single terminal to manage operations such as
printing, card payments, billing, and cash collection. Moreover, need for
user-friendly, secure, and convenient payment options is bolstering the growth
of global POS terminal market. Large number of debit and credit card
transactions is pushing the demand for POS terminals among retailers and other
end-users. Additionally, reduction in the cost of POS systems and government
initiatives to promote cashless transactions in various countries are expected
to fuel global POS terminal market in coming years.
Benefits of POS Terminals for businesses
In recent years, POS terminals have
evolved from just a sales portal to a comprehensive payment processing system
that integrate with other business tools and offers advantages such as:
·
Automate
Sales Processes
POS Terminals make transactions faster
and easier for businesses as well as customers. Rather than sitting with a pile
of cash and checks at the end of the day to evaluate sales, retailers can
simply track the total number of transactions, average revenue per transaction,
amount of refunds or returns, and customer’s payment methods with an efficient
POS terminal. The business owners can also learn about the products that are
not selling, the days and times they sell the best and evaluate how they
perform at different price points.
·
Inventory
Tracking
Powering the sales terminal, the store
owners can check the inventory at retailers or more locations with stock counts
and automatically reorder inventory every time a barcode is scanned into the
POS. Also, the POS system automatically updates inventory when items are
returned. Most POS inventory system also consists of ring sales, count inventory,
and provide basic reports.
·
Card-Reading
Capabilities
If you do not have a large space for a
large cashier, mobiles POS systems can help, converting your smart phone or
tablet into a POS for accepting card payments. Just connect card reader to the
smart device, keep the POS open and when prompted, ask the customers to swipe,
dip, tap their card for making the transaction.
·
Increased
Revenue
As the transactions are increasingly
becoming cashless, customers do not tend to have cash-on-hand, and they prefer
to use debit or credit card for shopping. POS terminals enable transactions
anywhere on a brick-and-mortar location to a popup store, so the customers do
not have to find the nearest ATM to make purchases. POS vendors are enhancing
security of customer data and chargeback protection to reduce losses and avoid
fraudulent purchases.
·
Customer
Management
The POS terminal captures data to
personalize customer’s experience while shopping. Using contact information
such as phone number, e-mail id, etc., businesses can send order updates,
create targeted email campaigns based on their past purchases and other
behaviours or demographics. Loyalty programs are effective tools to promote
repeat purchases and attract potential customers, aligning rewards with their
interests.
How POS terminal work?
The POS terminal can be on-site and web-based
but the day-to-day operation to process sales remain the same with both
mediums. On-site software is generally installed on the terminal of your server
and vendors do not need any internet connection to process payments and the
data is stored locally. On the contrary, web-based POS terminals are more
common and easy to setup but requires internet connection to process cards and
the information is generally stored on the cloud.
POS Setup
Create an account locally and login into
the online interface. Add products and service offered by the store or business
into the POS database. Add merchant account and payment gateway for credit card
sales and set up sales tax rates. Set up tipping options, if applicable.
Customize receipts with business information and return policy. Create employee
logins and manage permissions. Connect to third-party software.
Logging into your local or web-based
account, connect the hardware components such as card terminal, barcode
scanner, receipt printer, and cash drawer.
Steps to process transactions
·
Scan
the product barcode with barcode scanner to look up the item’s price. For
online stores, this step happens when a customer finishes adding items to their
cart and clicks on the interface.
·
POS
system calculates the price of item, including sales tax and then updates the
inventory count to show the status of item.
·
To
finish the purchase, customers either use a credit card, tap card, debit card
or other means to make the payment go through. Depending on the payment method,
the customer’s bank authorizes the transaction.
·
The
payment goes through, and the printer generates a printed receipt.
Technological Advancements in POS Terminal
Systems
Thanks to rapidly evolving technologies,
POS systems have undergone major transformation for more efficient operation.
Here are some of the major POS terminal system trends dominating the market.
·
Mobile
Wallets
Customers are replacing old payment
hardware with new ones therefore physical stores are increasingly adapting
NFC-terminals ready to take digital wallet payments. Replacing the use of
credit cards or debit cards as well as cash, mobile wallets not only add to the
convenience of the customers but also adds to the flexibility of business
operations.
·
Cloud-based
POS Systems
The web-based POS terminals are
cloud-based, allowing data storage into the cloud. Unlike traditional POS
systems, the modern cloud-based POS systems are more secure, reliable and take
minimal time for system maintenance. A cloud-based point of sale system can
help to streamline operations, increase customer satisfaction, and accelerate
payment process, opening greater channel of integrating the system with other
systems.
·
Data
Analytics
The data collected through processed
payments on POS systems provide useful insights for improving the business
operations and make decisions that pertain sales and customer service. Some of
the useful data include tax information, number of sales, employee
productivity, and customer details.
·
Mobile
POS Systems
With mobile POS systems, the attendants
can reach to the customers to facilitate the payment process. The systems also
enable customers to view different products and their respective product
information for convenient purchase. With the advanced mobile payment methods,
customers can avoid queue in business premises and avoid the waiting time.
·
Bluetooth
Payments
Although online payments are convenient,
the payment process may experience interruptions due to weak connections.
Bluetooth mobile payments allow the making of connections to facilitate easy,
fast, and secure payment methods.
·
On-Demand
Purchases
On-demand purchasing applies when the
customer shops at their convenience from e-commerce platform and only passes by
the store to pick up goods. The POS systems with this feature are becoming more
popular as they provide convenience and saves time.
·
EMV
Payment Security
Newer POS terminals come up with
built-in security features and EMV card readers is one of them. EMV stands for
Europay, Mastercard, and Visa and is a worldwide standard for cards with
computer chips. Using this technology, the transactions can be made safe and
secure. Older magnetic strips keep the same data for every single purchase,
which make them easy to copy and more vulnerable to hacking. Merchants can
easily add EMV card readers to their POS system to reassure customers of their
security for every purchase.
·
Self-Service
Kiosk POS
Self-service kiosk POS systems are
interactive terminal that allow customers to display a piece of information and
streamline wait or cost by giving control to the customers to get the things
done as per their convenience. Different industries such as airlines, retail,
and hospitality are using self-service kiosk for enhanced infrastructure and
eliminate the need for person-to-person interaction as they prevent passing
back and forth of credit cards and other payment modes which can act as virus
transmitters.
According to TechSci research report on “Australia POS
Market By
Product Type (Fixed and mPOS), By Deployment (Cloud and On-Premise), By
Industry (Retail, Travel & Hospitality, Media & Entertainment,
Healthcare, Education and Others), Competition, Forecast & Opportunities,
2024”, Australia POS market is anticipated to grow at a CAGR of
more than 10% during 2020 - 2024 on account of technological advancements,
affordable internet connectivity and increasing penetration of smartphones.
Point of sale (POS) terminals are used for handling payments and checkouts.
Modern POS terminals integrate multiple systems into a single terminal to
manage operations such as printing, card payments, billing, and cash
collection. Moreover, need for user-friendly, secure, and convenient payment
options is further bolstering the growth of Australia POS terminal market. A
large number of debit and credit card transactions is pushing the demand for
POS terminals among retailers and other end-users across the country.
Additionally, factors like low cost of the point-of-sale devices and easy
deployment backed by the increasing inclination towards cashless economy are
anticipated to positively influence Australia POS market through 2024.