The best point-of-sale (POS) systems do more than just process transactions. The best systems also offer software capabilities that streamline your daily workflow, combining tools such as employee scheduling, customer loyalty programs and inventory tracking into one sleek platform. But how do you determine which one is the right fit for your needs?
Forbes Advisor has evaluated dozens of POS systems by price, ease of use and functionality to bring you this ranking of the best POS systems for Australian small businesses in 2023.
What Is a Point-of-Sale System?
A POS system, also known as a point-of-sale system, is a hardware and software solution used to conduct transactions. This could be anything from selling a product to managing inventory or tracking customer data. A POS system can be as straightforward as a card reader or as complex as an all-in-one solution that includes features such as loyalty, scheduling, front of house, inventory management, customer relationship management (CRM) and e-commerce.
POS systems are used by businesses of all sizes in a variety of industries, including retail, restaurants, hospitality and services. If you’re running a business that relies on transactions of any kind, then a POS system is likely a good fit for you.
How Does a POS System Work?
A point-of-sale system guides customers through a series of steps that end with a successful purchase. In most cases, it works in the following way:
A customer selects item(s) to buy: The buyer either physically presents the products at the checkout kiosk in the store or views their digital shopping cart with the intent to finalise their payment.
The POS system prices the item(s): The business’s POS tool tallies the total cost of the customer’s item(s), including applicable tips and sales taxes. Often, businesses use POS software that provides discount management tools. These allow companies to keep track of how customers apply coupons and promo codes.
The customer pays: Customers typically pay using credit cards, cash or cheques. Therefore, POS systems often include corresponding hardware such as cash drawers, card or cheque readers and receipt printers. While online stores lack the need for hardware components, their point-of-sale systems usually include plugins or apps that make it possible for customers to pay using credit cards, PayPal or even cryptocurrencies like Bitcoin.
The POS system completes the transaction: The software runs calculations that determine what the customer owes and the exact change that may be due. At this point, a cashier or the automated machine itself manually returns any change. Internet shoppers get taken to a post-purchase page with their relevant purchase and shipping information. In most cases, customers receive a confirmation email.
A POS system can do much more than track sales. The right software can provide crucial insight into customer behavior, enable real-time tracking of inventory and much more.
How to Choose the Best POS System
To choose the best POS system, first consider whether or not the system offers the tools and features your business needs–now and in the future. Ideally, a POS system should make it easy and affordable to accept payments no matter where you are selling or how customers are paying. Additionally, look at the bigger picture in terms of pricing.
Depending on your sales volume, it may or may not be worth opting for a POS system with a higher monthly rate if it comes with the benefit of lower transaction costs.
POS Software Features
When choosing a POS system, the first step is to consider what features you need. Do you need basic transaction processing, or do you need more advanced features such as loyalty, appointment scheduling, inventory management and email marketing?
Here are some common POS software features to look for:
Credit card processing: All POS systems will process credit and debit cards, but some systems will require you to use a specific payment processor. Others will let you choose your own processor.
Loyalty: If you want to offer loyalty programs or gift cards, look for a system that offers this feature.
Appointment scheduling: If you’re in the business of appointments, such as a hair salon or a day spa, look for a system that offers online booking and appointment reminders.
Inventory management: If you need to track inventory levels, look for a POS system that includes this feature. Some systems will even let you automatically reorder when inventory gets low.
Customer relationship management (CRM): If you want to track customer data, look for a system that includes a CRM feature. This will let you keep track of customer purchase history, contact information and more.
Reporting: All POS systems will offer some kind of reporting, but some will be more robust than others. If you need detailed reports on your business performance, look for a system that offers this.
E-commerce: If you want to sell online as well as in store, look for a system that offers an e-commerce solution. This will let you manage inventory and orders from one central platform.
POS Hardware Features
In addition to software, you’ll also need to consider hardware when choosing a POS system. The type of hardware you need will depend on the type of business you have and the features you’re looking for.
Here are some common POS hardware features to look for:
Touch-screen display: A touch-screen display is a common feature on POS systems. This lets you easily navigate the software and enter information.
Receipt printer: A receipt printer is a must-have for any POS system. This lets you print receipts for customers.
Barcode scanner: If you need to scan barcodes, look for a POS system that includes a barcode scanner.
Cash drawer: A cash drawer is another must-have for any POS system. This lets you store cash and keep it organised.
Payment terminal: If you want to accept credit and debit cards, you’ll need a payment terminal. Some POS systems come with a built-in terminal, while others require you to use a separate one.
Types of POS Systems
There are many types of POS systems on the market, from simple card readers to all-in-one solutions. The best POS system for your business will depend on your specific needs.
Here’s a rundown of the different types you might encounter.
A hospitality POS system is a specialised type of POS system that’s designed for restaurants. These systems typically include features such as table management, kitchen display systems and online ordering. Most will also have inventory management, so you can auto-reorder ingredients as they get low. There are even POS systems with features ideal for managing bars.
A retail POS system is designed for retail businesses. These systems typically include features such as inventory management, customer loyalty programs and gift cards. Some retail POS systems also offer appointment scheduling and reporting.
An iPad POS system is a type of mobile POS system that uses an iPad as the main point-of-sale terminal. These systems are becoming increasingly popular due to their portability and ease of use. Many iPad POS systems come with built-in features such as credit card processing, scheduling and receipt printing.
A mobile POS system is a type of POS system that can be used on a mobile device, such as a smartphone or tablet. People are relying more on these systems because of their portability and easy setup. Many mobile POS systems come with built-in features such as credit card processing, inventory management and receipt printing.
An Android POS system is a type of mobile POS system that uses an Android device as the main point-of-sale terminal. Due to their mobility and simple-to-use interface, these systems are increasing in popularity, too. Most Android POS systems come with features such as credit card processing, barcode scanning, and receipt printing.
A cloud POS system is a type of POS system that’s hosted in the cloud. This means that all of your data is stored online, making it easy to access from anywhere. Cloud POS systems are becoming more popular because they’re easier to set up and use than traditional POS systems. They also typically come with features such as inventory management, customer loyalty programs and gift cards.
A POS terminal is a type of POS system that’s designed for businesses that need to process credit and debit cards. These terminals typically come with features such as EMV compliance, PCI compliance and fraud prevention.