By Holly Stanley
Introduction
All retailers with physical locations need a point of sale (POS) system to accept payments and maintain accurate sales records. However, a furniture store with 50 locations will have different needs than a small jewelry business running a pop-up shop for the first time.
When deciding on the best POS system for your small business, it’s essential to consider the features that align with your current needs and future goals.
What is the best POS system for small businesses?
The Shopify POS system integrates seamlessly with the Shopify e-commerce platform, allowing small businesses to manage sales both online and in-store efficiently and effectively.
With Shopify POS Go, you can sell your products wherever your customers are. You can check inventory, view customer profiles, and provide a more personalized shopping experience while interacting with customers.
Shopify POS helps you run up to 1000 physical stores and your online store, all from one platform. You can find out where products are located and their availability during a sale.
Features: Multichannel sales, smart inventory management, customer profiles, reporting and analytics, employee management, intuitive checkout, Shopify Payments, customer relationship management (CRM), marketing tools, hardware options, wireless payments, mobile selling.
Processing fees: In-store: 2.7%; online: 2.9%, plus 30 cents.
Monthly fees: Requires a paid Shopify plan to use the POS system.
Square: A versatile all-in-one solution for small businesses
Square offers an easy-to-use interface, affordable pricing, and a variety of features, making it an ideal choice for small businesses looking for a versatile all-in-one solution.
The free version allows sales tracking and processing payments without an internet connection. Square also provides services like payroll that integrate with the POS system.
Features: Customer accounts, third-party integration, inventory management, mobile access, shift scheduling, loyalty program, employee management, electronic payments.
Processing fees: In-store: 2.6%, plus 10 cents; online: 2.6%, plus 30 cents.
Monthly fees: $0.
Lightspeed Retail: Powerful inventory management for retail businesses
Lightspeed Retail offers robust inventory management capabilities. It is an option for small businesses with complex inventory needs, such as retail stores or businesses with multiple locations. Lightspeed Retail provides personalized training and an account manager with every plan.
Features: Inventory management, multi-store capabilities, sales reporting and analytics, employee management, e-commerce integration, point of sale (POS), loyalty program, purchase order management, hardware integration, payment processing.
Processing fees: In-store: 2.6%, plus 10 cents; online: 2.6%, plus 30 cents.
Monthly fees: Starting from $69 per month.
Toast: Designed for the food service industry with menu and order management on-site
Toast is specifically designed for the food service industry, with features such as menu management, table orders, and kitchen display systems. It is a choice for small restaurants and cafes.
Toast provides management for multiple locations, so you can roll out different menus and set different prices at each site. Features like online ordering and customer loyalty programs are additional charges depending on the plan you choose.
Features: Online ordering, inventory management, kitchen display system, reporting and analytics, digital menu boards, gift card management, employee management, delivery tracking, table orders, loyalty programs, mobile ordering, multi-location management.
Processing fees: With monthly device payment: 2.99%, plus 15 cents; purchasing devices upfront: 2.49%, plus 15 cents.
Monthly fees: Starting from $0.
Vend: A cloud-based POS system for multi-location businesses
Vend is a cloud-based POS system that works for small businesses with multiple locations. It offers centralized inventory management and real-time reporting across stores. You can choose your payment processor or use the integrated one, which is Lightspeed Payments.
Vend provides
The Lean plan for your account manager includes 24/7 customer support via phone, live chat, and email. You will also receive integrated payments and cloud backup. For integration with Shopify or accounting software like QuickBooks, you will need a more advanced plan.
Features: multi-channel sales, inventory management, payments and security, sales tracking, mobile POS, inventory control, promotions and discounts, offline sales, refunds management, vendor management.
Payment processing fees: 2.6%, plus $0.10.
Monthly fees: starting at $69 per month, billed annually.
Clover: Versatile POS System with Tailored Solutions for Different Industries
Clover POS provides solutions specifically designed for various industries, with features like inventory tracking, customer management, and integration with different payment providers. It’s a versatile option for small businesses across different sectors.
Clover and third-party vendors sell hardware bundles and components. On the backend, Fiserv, the parent company of Clover, processes payments, but you can choose your own service provider.
Features: mobile payments, employee management, inventory management, order tracking, online ordering, CRM integration, multi-location support, security and fraud protection, instant reporting, e-commerce integration, 24/7 customer support, barcode scanning, table planning and management, digital menu boards, access to APIs.
Payment processing fees: in-store: 2.3%, plus $0.10 for most plans.
Monthly fees: starting at $14.95 per month.
Revel Systems: Feature-rich POS System for the Hospitality Industry
Revel Systems is a POS system that offers features such as customer relationship management, loyalty programs, and online ordering. It is well-suited for small businesses in the hospitality industry, including restaurants, bars, and cafes.
Revel POS provides external digital displays for quick-service restaurants, and delivery tools like driver tracking and text message updates. Installation can be costly, and you must purchase a minimum of two devices.
Features: cloud-based POS, quick service POS, self-service kiosks, inventory management, instant reporting, enterprise management, loyalty programs, payment processing, offline mode, API integration, accounting integration.
Payment processing fees: 2.49%, plus $0.15.
Monthly fees: starting at $99.99 per month per device.
Types of POS Systems
Retail POS system, multi-channel POS system, mobile POS system.
As your small business grows, your need for a POS system that can handle increasingly complex retail and operational systems will grow.
Here are three different types of POS systems for small businesses.
Retail POS System
Retail POS systems allow you to accept payments in person, monitor inventory, track sales, and manage team members. They are typically tied to a checkout counter and designed for merchants selling from physical locations like pop-up stores, events, festivals, and brick-and-mortar stores.
They do the heavy lifting on your behalf, including maintaining accurate sales and inventory data. Every time you buy, sell, return, or exchange a product, the sales data and inventory levels are updated in real-time.
Multi-channel POS System
Multi-channel POS systems can help unify your online sales with other channels.
The single POS system from Shopify unifies your online store data and physical store data — customer, inventory, sales, and more — into one office. You can view easy-to-understand reports to spot trends faster, take advantage of opportunities, and boost your brand’s growth.
Mobile POS System
Mobile POS systems are software and hardware solutions useful for processing payments. They are very similar to traditional retail POS systems but do not need to be linked to a single checkout counter.
Using
A mobile POS system allows you to download POS software on your mobile device and process payments wherever your customers are. This means your physical location does not need to have a fixed checkout counter, which is beneficial if you sell at festivals and events.
Justina Silvia, owner of Isle Wilde, says having a mobile POS system has been great for jewelry festivals.
“Having a system that turns your phone into a POS is a blessing from heaven,” Justina says. “Shoppers feel more secure buying products through professional tools. It gives customers more confidence in who they are buying from.”
Why do small businesses need a POS system?
Small businesses that want to accept payments in person, track sales, and manage inventory need a point-of-sale system.
While you can only accept cash payments and manually track sales on a spreadsheet, it will be difficult to meet customer payment preferences and challenging to achieve accurate inventory management. Let’s explore all the benefits of investing in a POS system for small businesses.
Accepting Payments
With a POS system for small businesses, you can accept multiple types of payments in-store. Depending on the software and hardware you choose, you may be able to accept and record payments from mobile devices or tablets, in addition to traditional checkout counters.
Tracking Sales and Inventory Management
The best POS systems for small businesses automatically track all sales. They store key product information such as: wholesale price, retail price, gross profit, and net profit.
Your POS system updates inventory and sales data every time you buy, sell, return, or exchange a product, whether in-store or online.
Managing Inventory from One Dashboard
The Shopify POS system comes with tools to help you manage inventory in both the warehouse and store in one place. You can forecast demand, set low inventory alerts, create purchase orders, see which products are selling or on the shelves, conduct inventory counts, and more.
What features should a POS system for small businesses have?
A powerful POS system for small businesses allows you to process payments securely and comes with software to help you handle administrative tasks easily. The nature of your business and the types of sales you make will help you determine the features your POS system should have. For instance, a POS system for a retail flower shop might work well but may not be suitable for an online beauty vendor managing their first pop-up store in person.
Here are the top five features to look for in a POS system:
Accepting Multiple Types of Payment
Statista forecasts that digital and mobile wallets like Apple Pay and Google Pay will surpass cash and credit card payments by 2024, accounting for about 35% of the payment market share. As a result of the pandemic and the increase in payment options such as digital wallets, customers want the convenience of choosing multiple types of payments.
Your POS system should make accepting in-person and online payments simple. Most modern POS systems allow you to accept common payment types such as:
- Wireless Payments: Including digital wallet payments using Apple Pay or Google Pay and chip cards.
- Cash: Which you deposit into the cash register.
- Chip Cards: Credit or debit cards that feature NFC chips to allow contactless payments.
- Magstripe Cards: Which allow customers to swipe their card in your card reader.
- Card-Not-Present Transactions: When a shopper pays with their card without physically having it present. These payments are usually made when a customer purchases over the phone.
- Cards
- Gifts: Digital or physical gift cards that can be redeemed for online or in-store purchases.
- Payment options via Amazon and Facebook: Allows customers to pay using their accounts on Amazon or Facebook.
- Everything they have purchased at your store or online.
- How much they have spent so far.
- The number of times they have ordered.
- How long they have been customers.
- POS Software Fees: There are typically monthly or annual fees, with different plan tiers and prices associated. Higher-tier plans typically come with advanced features, such as in-depth reporting and analytics.
- Hardware Costs: These costs depend on the types of payments you want to accept, the number of stores and employees you have, and the general functionalities you need.
- Payment Processing Fees: Each time you process a sale, the payment processor charges a fee. These fees are typically charged per transaction and taken as a percentage of the total transaction amount. Sometimes, the amount you pay per transaction depends on the credit card used by the customer.
Inventory Tracking
The best POS system for small businesses can help track and manage in-store inventory, but most do not allow merchants to track inventory across multiple channels like their online store, physical locations, and storage units.
Merchants in the U.S. sit on an average of $1.40 in inventory for every dollar in sales they make. Successfully tracking and managing inventory can help reduce these costs and ensure that excess capital is not tied up in inventory.
Using POS systems to track your inventory across multiple channels will help secure enough stock to meet customer demands while preventing frustrating stockouts, excess inventory, and stock shortages.
Customer Profiles
According to a recent study, 60% of consumers say they would become repeat buyers after a personalized shopping experience with a seller. By tailoring your offerings to customers, you can enhance brand loyalty and revenue.
A POS system connected to your online store will help easily collect, track, and manage customer data.
For example, with Shopify POS, you can create customer profiles and view their entire purchase history, including details such as:
All this customer data is real-time and exists in one location. This helps your team have more context and serve them better. You can also use the data to segment customer profiles and build email lists to keep customers engaged and increase repeat purchases.
Sales Reports
Look for a POS system for small businesses that aggregates sales reports from data collected in your physical and online locations. This way, you will have a complete picture of your business performance.
Justina Sylvia says, “Having sales reports is incredibly useful and makes tax season literally easy. You can download reports in seconds. Plus, it’s a great tool to understand how your business is doing and when you need to amp up your marketing.”
Employee Management
Your POS system should help you manage your team members as your business grows and expands.
Look for management features such as permissions and team roles to make it easier to lead your team. Using these features, you can set limits on the actions that team members can take without supervisor approval, such as issuing a refund to a customer or applying a custom discount to a product.
It’s also beneficial to be able to see employee performance metrics, such as average transaction value, average transaction units, and daily sales.
How to Choose Your Small Business POS System
When choosing the right system for your small business, it’s important to consider the features you need to manage your business effectively now and in the future.
Compare POS system providers
Review the costs
For any business, the cost of a POS system will be a determining factor. The POS system you choose should fit your budget.
When reviewing the costs of POS systems for small business owners, there are three factors to consider:
Take
When considering inventory management
Effective inventory management typically starts with a POS system that automatically updates your inventory levels when you sell, return, or exchange products in physical and online retail locations.
By managing inventory from a single platform, you can ensure accurate inventory reporting and streamline your overall management system. This way, you’ll spend less time manually counting stock and reconciling inventory, reducing the likelihood of human error.
Consider selling online and in-store
Nearly 50% of brands say unifying their operations and data online and in-store is their biggest challenge.
The best POS systems unify online and in-store sales. They not only connect to your online store via an API but also collaborate with it and have integrated multi-channel selling features.
Even if you are currently selling exclusively online or in physical retail locations, you may want to give customers the option of both shopping channels in the future. Make sure the POS system you choose can support your business as it evolves.
Start using a POS system for small businesses
A POS system for small businesses helps you accept more payment methods, manage inventory accurately, run sales reports, and more. Look at your unique needs as a growing small business. What works for some merchants may not work for you. So think about the features you consider most important for your POS system, your budget, and your future business goals.
Sell the way your customers shop
The Shopify POS system unifies online and in-store sales and makes the checkout process seamless. Get all the tools you need to break free from the office and sell wherever your customers are without worrying about your technology, integrations, or dispersed sales reports.
Frequently Asked Questions about POS Systems for Small Businesses
What should a POS system include?
A point of sale (POS) system should include a main terminal that connects to a payment processor and keeps records of inventory and sales. Barcode scanner: used to read barcodes on items and quickly input them into the system. Credit card reader: used to process credit and debit card payments. Receipt printer: prints customer receipts. Cash drawer: used to store and secure cash payments. Inventory management software: used to manage inventory and track sales. Customer display screen: used to show customers the items they are purchasing and the total cost. Security measures: may include cameras, motion detectors, and other measures to prevent theft.
Do I need a POS system for my small business?
It depends on the type of business you operate. If you run a retail store, a POS system is essential for tracking sales and inventory. If
Source: https://www.shopify.com/retail/pos-systems-small-business#16
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