It used to be that for a small retail business, a cash register and a black-box credit card terminal were sufficient. But since personal computers have emerged, nowadays most retail stores have begun to utilize a specialized PC for sales and inventory purposes.
These PC’s are accessorized with a cash drawer, bar code scanner, credit card swipe bar, check reader, receipt printer and sometimes other peripherals.
In addition to their hardware components, a POS Point of Sale terminal is running special software. This software allows sales to be rung up, obtains credit card and check authorizations and monitors inventory.
Most setups allow the clerk to use a bar code laser scanner to read the UPC (Uniform Product Code) on items being sold or as they are added to inventory upon delivery.
Inventory functions permit adding a description, price and quantity of items as they arrive in the store.
As items sell, that quantity is automatically deducted from the in-stock inventory quantity.
There are other functions available for specific business niches. For example, restaurant POS systems include a priner for the kitchen to send orders to be prepared as soon as the server enters them on a touch screen out front. Tip and other functions are built in to the software. There is POS software specific to almost every kind of business imaginable – hotels, retail, restaurant, auto mechanic, etc.
Most POS systems are able to be plugged in to the business’ high speed internet connection. They can process credit card and check authorizations very quickly, as compared to the usual dial-up connection of an ordinary “black box” credit card terminal.
Daily and periodic reports may be produced by the POS software, suitable for in-house accounting or to be sent to the accountant for bookkeeping. All common accounting software is supported, such as Quickbooks and Peachtree.
If you already own a PC you can “create” a POS by purchasing the POS software and adding the peripherals you will need such as a cash drawer, credit card swiper, etc. But I recommend against such cobbled-together systems. It is better to have a stand-alone POS equipped with POS software.
If your business is already set up to process credit cards, you will definitely want to check with your current processor before purchase of a POS, in order to ensure that the system and software you buy will be compatible with your processor’s platform. You must be able to “load” your merchant account numbers into your software, and tell the software the telephone numbers and/or internet addresses it needs to access to get credit card authorizations.
Be cautious, therefore, about setting up with Quickbooks or other proprietary POS software systems. These systems are designed to run only under that merchant processor and you will be locked in to any future processing rate increases they decide to impose. To change from them down the road would be a huge task and they count on this, that is why their POS software is so cheap up front. They will have you locked in as a merchant customer forever.
Your first and best information source is your merchant processor account executive.