Every business is going to have different needs, but they all have one thing in common: taking and keeping track of money. Today’s market for point of sale systems ranges from high tech and advanced to efficient and on-the-go. Whether you have a brick and mortar clothing store or a mobile food truck, you will want to choose a POS system that works well with your business. When trying to pick the best one, ask yourself some of the following questions.
Do you want invoices?
For businesses that deal with a lot of vendors, or that provide specific services, having the ability to easily create professional, itemized invoices can be crucial to successful business interactions.
Do you have consistent access to WiFi?
Some businesses that need to conduct transactions on the go might not be able to take advantage of some of the more mobile innovations in POS systems today. If that is the case, you might want to look into mobile extensions that can then connect and relay information to a central terminal when you get back into the office.
Do you want rewards programs?
If you want to reward your best customers, you will need a way to keep track of who they are. Punch cards and point systems are easy to create with certain POS systems that have the right software and hardware, and worth the investment if you want to keep bringing your biggest supporters in time and time again.
How does your team communicate?
For restaurants especially, it can be crucial to keep everyone in the business on the same page about tickets and customer desires. Don’t let miscommunication or verbal relays get in the way of good customer service when terminal and mobile POS systems can integrate these functions with your pay stations.
Are employees going to clock in and out?
If you want a system that will really give you all the data you need to keep your books in order, consider one that interacts fully with your employees as well as your customers. Simple clock in and clock out features make it easy for employees to log their hours, and that makes printing your reports and doing payroll even better.
With the purchase of a new advanced POS system, like a full Verifone POS terminal, you can gain access to a whole range of new features and data about your customers. But, for some this information gets lost and never applied to anything more than general bookkeeping. That’s a shame, because using the information your POS system and its software tracks to your advantage, like creating great loyalty programs that reward you most valuable customers, is an excellent way to bring people back into the store and encourage others to give your establishment a try. Here are some of the most effective methods for implementing a loyalty program at your business.
Buy “X” Get “Y”
It’s a proven method as a loyalty program, most often seen as the “Buy One Get One sale”. But there’s no reason you can’t expand the idea using your POS system. Create real or digital punch cards like you might see in coffee houses or donut shops if you have an item that customers will purchase multiple times throughout a certain period. For every third item they buy, offer one or at a discount. This is also a great time to comb through your sales and volumes to determine how often people are buying a specific item, or returning for it. Giving them a little encouragement to return to you instead of anyone else will help build relationships and ensure repeat business.
If you want to take the concept of tracking your most valued customers and their habits a little bit further than offering them discounts or rewards on specific items, you can implement a tier system that affects the customer rather than the product. You can easily do this by creating a rewards program or a special status for the customers who come in the most often. Giving your most frequent customers cards that give them extra discounts or open the door for sales that aren’t available to the general public is a great way to create buzz about your store and bring people back more and more. For those businesses looking to create easier rewards systems, you can always give points out for certain purchases that can be applied the more they are accumulated.
For stores that want to really make their best customers feel like VIPs in an exclusive club, you can offer up a paid membership in a rewards program that gives discounts on all or certain purchases with a yearly fee. It’s important here to really crunch the numbers and make sure that customers will appreciate the discount without costing you too much if lots of people join.
The low cost hardware and huge user bases of mobile credit card processing has made cards more ubiquitous than ever before. But that easy hardware might not be as compatible with a potential future trend: the chip card also called EMV payments. Long the standard method of payment in Europe and other parts of the world, American banks are slowly starting to phase in the more secure, but much more expensive chip card. Something business owners will want to take note of before thinking their mobile payment system is really ready for the future.
Chip Card Readers In Stores
In an effort to curb fraud, liability will soon shift from card issuers to merchants if the merchants have not upgraded payment systems to terminals like those found in Canada and Europe that don’t use the magnetic stripe, but instead require a chip and pin. For a lot of small businesses that have been riding high on the easy fees of mobile payment services like Square, this means the easy and free technology to turn their iPads into credit card machines could get them into huge trouble.
Benefits to Chip and Pin
A lot of Europeans are often shocked of American customs to hand over cards and allow the waiter to process the transaction on their behalf. And the wide introduction of the more secure chip and pin system will mean added security both at the technological level and also in the sense that now customers at stores and restaurants will never lose sight of their cards. Of course, many American businesses have become accustomed to easy services like Paypal or Square, but they are soon going to lose the ease of the magnetic strip.
This upcoming new rule means that a lot of businesses, where customers will expect to use their cards, will need to upgrade their point of sale systems, choosing card readers like portable Verifone systems that will read the European style chip. Previously popular low cost systems will offer updates to their magnetic stripe readers, but these have yet to be proven as reliable and will also add costs to their current free reader model.
In the end the upgrade will end up creating a safer environment for card uses, but businesses need to be prepared for the transition with the right equipment.
Even after you have found the perfect machine for your business, your credit card worries don’t end there. There are three major types of credit card processing services that you should be aware of in order to get the most out of your new Verifone POS system.
Every time a customer uses a credit card, a code is generated that categorizes the purchase based on how risky it is. Sandwiches, cups of coffee, and other small, relatively inexpensive items are assigned a code signifying low risk. Meanwhile, something expensive, like furniture, gets a code that corresponds to a high risk purchase (especially if it is made online). Through tiered processing charges different rates for the different types of purchases that could be made at your store. Low risk purchases will have a lower rate for processing, while the highest risk will higher rates. This system can work out great for stores that are using purchases that are mostly “low risk”, or “qualified” as most companies call them. However it’s important to be clear from the beginning with your company how they will be classifying transactions. Your rate on “qualified” transactions might be great, but you will want to be sure the majority of your products fall in this category.
Interchange works to fix those problems that pop up with tiered pricing. Through Interchange-plus pricing, you can easily break down each transaction to one fixed percent and one fee. This usually works out to be the best deal for companies that have a very high volume, but other retailers and merchants could find benefits as well. The percentage is determined by the processor’s markup and the fee is set by credit card associations–usually .5% plus $0.15 to $0.30.
Flat-rate would be the newcomer to the party that has really been shaking things up for everyone in the credit card industry. With more flexible services like Paypal and Square, things become much less common. The fee you py is usually one fee per transactions with no exceptions or a monthly subscription service. A great option for business owners looking to cut down on their headaches and have simple credit card fees to wrap their heads around.
There are a lot of complicated formulas that can come into play for getting your business on track with exactly the right credit card processing service and point of sale system for you. Take the time to discuss with your accountant, or sit down and do the math yourself, so you know your effective markup, your effective rate, and the volume of your credit card transactions. With this information in hand you can more easily see which type of service is best for you.
As we’ve discussed in the past, a POS system should be geared to the business that you are running, and a large part of that is understanding the different payment methods available to your customers and where they like to use them. The recent Consumer Payment Choice Study released findings of adults in the US and what payment methods they used where. To see some of the interesting results, take a look at our breakdown by payment method below:
Debit remains one of the most popular forms of payment for a variety of different circumstances. The normal everyday or weekly purchases for a household are usually made on a debit card such as supermarkets, gas stations, and discount stores. In each of these areas more and 35% of all purchases are made with a debit card at these locations, meaning that any POS system for businesses in these areas must include reliable debit capabilities.
Second behind debit cards, credit cards remain extremely popular, especially in purchases made based on want, rather than necessity like debit cards. These types of purchases are most commonly made at department stores and restaurants. In both instances though, credit cards only slightly edge out debit with little more than 30% using their cards. The area that credit cards far edge out all other forms of payment is online shopping where 41% of all purchases are made with a credit card.
The former king of payments, and of course one of the only ways to complete a transaction, has fallen from being used ubiquitously but remains popular in certain domains. 39% of all customers at a fastfood restaurant will choose to pay with cash, but also discount stores and dine in restaurants see around 20% of customers choosing to pay with paper. Business owners in these areas should be mindful of a POS system that will help them keep track of bills.
Paypal was the only other method measured by the study, and every category it scored close to 2% except for online shopping, which should come as no surprise. Online, 22% of a customers chose to pay with Paypal. Despite the fact that the numbers are low, business owners should be mindful of the fact that services like Apple Pay could significantly increase these statistics by the next survey.