how a pos works
the chief job of the pos is to calculate the total cost of an order take payment and log the transaction the process starts by recording the items to be purchased in a supermarket for example this would involve entering the items into the pos with a barcode scanner the software will record all the data including the name and quantity of the items being purchased once all the items have been added it s time to pay normally there are two options pay with cash or a card cash payments involve either inserting the relevant notes or coins into a machine or handing them over to the cashier card payments on the other hand could require either swiping inserting or tapping the card physical or virtual onto the card reader at this stage the pos will connect to the cardholder s bank potentially ask for a pin code check if there are enough funds to clear the transaction and then confirm whether the payment has been completed or rejected this all happens in a matter of seconds and ends with the generation of a receipt that confirms the conclusion of the card transaction the estimated value of the global point of sale market in 2023 1with online transactions the process is slightly different usually once you are ready to order you need to click on the checkout option and then insert if they haven t already been automatically saved your payment details that includes entering information about your card such as its number s and your address before completing the transaction your bank may also contact you to confirm if you want to proceed with the payment pos placementpoints of sale poss are an important focus for marketers because consumers tend to make purchasing decisions on high margin products or services at these strategic locations traditionally businesses set up poss near store exits to increase the rate 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 in the sales funnel for example department stores often have poss for individual product groups such as appliances electronics and apparel the designated staff can actively promote products and guide consumers through purchase decisions rather than simply processing transactions similarly the format of a pos can affect profit or buying behavior as this gives consumers flexible options for making a purchase benefits of pos systemselectronic pos software systems streamline retail operations by automating the transaction process and tracking important sales data basic systems include an electronic cash 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 revenue and sales patterns using integrated technology to track data helps retailers catch discrepancies in pricing or cash flow that could lead to profit loss or interrupt sales pos systems that monitor inventory and buying trends can help retailers avoid customer service issues such as out of stock sales and tailor purchasing and marketing to consumer behavior pos innovationmodern pos systems are commonly programmable or allow enhancement with third party software programs these systems can be tailored to meet specific needs for example 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 large online merchants to track and process numerous purchases cloud based systems can greatly reduce the upfront costs of implementing a pos system for many businesses customers can also interact directly with pos systems particularly in the hospitality industry often referred to as location based technology these systems can process transactions at customer locations for example at many restaurants customers can view menus and place orders on terminals located at their table in hotels customers use similar terminals to place orders for room service or to pay hotel bills another innovation is the use of mobile devices such as tablets and smartphones as pos terminals 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 in the retail industry and resulting use of pos displays for enticing customers to purchase 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 further innovation keeps happening all the time for example amazon experimented and rolled out for a while a cashierless just walk out option at fresh grocery stores which enabled customers to pay for an item simply by leaving the store the tech giant has since ditched this option in favor of dash carts which let you scan items as you place them into your shopping cart and then leave the store without queuing at checkouts 23