In every business in Singapore, it has become a requirement to use a point of sale (POS) terminal. So what does a POS terminal mean? It is actually an electronic device that is being used by businesses to process credit card payments, loyalty programs, rewards, and anything that a retail store will need. Overall, a POS terminal has the following functions:
- Reads the data from a customer’s credit or debit card
- Makes a check whether the funds in the customer’s bank account are enough to make a purchase.
- Easily transfer funds from the customer’s account towards the seller’s account – this is the account associated or linked with the credit card network.
- Able to record any transaction made and then prints a receipt
The POS terminals are standard computers that are attached with a cash register or electronic cash box along with a scanner or credit card reader, which is run with special software specifically programmed to process a specific transaction. It allows retail businesses to accept credit card payments without the hassle of going to the ATM to convert it to cash.
The cost for installing a POS terminal differs from the size, the functionality and the terms from the supplier. Small retailers can rent a POS terminal from the supplier.
Benefits of Using POS Terminals vs Traditional Cash Registers
- Provides a more detailed reports
- Provides a better inventory tracking
- More accurate
- Is upgradable or can easily grow with the business
- Can implement loyalty programs and rewards
- Read credit card and debit card transactions and make payments
- More secure
- Make a payroll record
- Ease of use
- Have a lot of options and providers
- Reputable POS providers provide customer support
- Grows along with your business
- Affordable for startups
- It is easy to use and some business people prefers not wanting the change
- Limited functions
- Limited reporting options
Before you make any decision, do a careful research, whether it’d be a cash register or a POS system, what matters is if the tool serves its purpose for your business and that it provides warranty.
Tips to Avoid When Choosing a POS Terminal
- Not realizing the needs of the business. So if a retailer is not updated or is using outdated POS terminals, then it will cause some problems.
- Purchasing a unit or units without making some research or checking some references that can demonstrate the POS in action to educate yourself with how the POS works and if it is easy enough for you to handle, especially with the setup.
- Make sure that the POS provider offers support. In case something goes wrong along the way or you need some upgrades, they’d be able to assist you. Make sure you are getting your POS terminal from a reputable provider.
- Not getting sufficient training. Most retailers make a mistake by not training themselves as well as their staffs to save money. This is a wrong practice. If something goes wrong, it will delay the operation of the business and you’ll end up losing customers that way. What is a one-time investment on training compared to losing your business?
- Do not buy based on price. The buying decision should be based on the requirements of the business.
- There is no one-size fits all POS software or system where it fits to all types of retail businesses.
So the next time you are looking to purchasing your first POS machine, make sure you make a sound decision.