Small business owners need to juggle and keep many balls in the air in order to keep their business alive, profitable, and sustainable for the long term. One of the tasks that require the rapt attention of small business owners is how to manage payments in order to keep the financial machinery of the business functional.
Without much ado, POS systems have proven to be a smart way for small businesses to manage payments. Yet, a study shows that only 50% of businesses with single store/outlet have a POS system while 64% of retailers in two or more locations have POS systems in their stores.
A POS system can however provide immeasurable benefit to your business and make it more convenient for consumers to patronize you. Below are four ways a POS system can influence the strategic growth of your business.
1. Improved inventory management processes
An important reason small business owners in the retail industry need efficient POS software in their sales operations is that it helps you to be more efficient in your inventory management processes.
Managing inventory manually is a painfully slow, laborious, and monotonous process; hence, your staff is bound to make mistakes – mistakes that could end up being costly when you don’t have accurate insight into your inventory levels.
A POS system can help you identity and track specific metrics such as the sales by size, price, and complementary purchases so that you can keep stock with the in-season and out-of-season trends. You’ll also be able to identify the low volume items so that you can offer discounts that will hasten their sale before they become permanent fixtures on your shelves.
2. Improving your sales reporting and analytics
You’ll find it much easier to make informed business if you are able to access and analyze the sales data from your storefront. When buying a POS system, you need to be sure that it is equipped with sales reporting and data analytics features.
A POS system can provide you with information on the sales you made each day and the returns you made on those days (by subtracting the unit cost price from the unit selling price). A POS system can also provide insight into your inventory levels. Counting hand written printouts from a cash register is an unnecessarily hard way to confirm sales and track inventories. A POS system can provide clues on your major sales driver so that you can focus on them and similar products while reducing the volume of deadweights in your inventory.
3. Optimize your checkout processes
The checkout point is the last and most important point of contact between your business and your customers and you want to make sure that the checkout process is as seamless as possible.
A POS system speeds ups the checkout process to look up the price of items and tally up the cart. An efficient POS system at checkout will also have barcode scanning capabilities and receipt printing to minimize the odds of error. It is okay to trust the employees staffing your checkout system but it is in your best interest to monitor the checkout process. With a POS system, you’ll be able to see sales per cashier, total returns, and even the number of times they opened the cash register.
4. Attracting more valuable customers
A POS software can help you up your customer management skills such that it feels as if you have a dedicated customer management team.
Effective customer management in turn helps you identify your preferred customers so that you target your sales and marketing activities towards them for increased ROI. A POS system can collect data on the purchase history of shoppers to provide you with insight on their spending history and patterns. A POS system can help you understand your buyer behavior such that you are able to create an effective loyalty program that encourages customers to spend up to certain dollar amount in exchange for benefits or other exclusive perks.