What is the Point of Sale System?

The POS system is the heart of every business, small or large. Whether selling through a physical store front or online, the POS system will be your primary tool to track sales and inventory levels, enabling you to keep tabs on how many units are left in stock and reorder more when necessary.

While most businesses use stand-alone POS systems, some choose to outsource their point of sale system for a number of reasons.

Both options carry the advantages and disadvantages that we will discuss at length below.

POS System: The Pros and Cons

Standalone POS System Advantages:

1) Control over the system. By having a dedicated system, you would be in complete control of the data and information captured by your POS software, as well as how it is accessed.

2) Ability to upgrade. When compared to a hosted or cloud-based POS system, you will have more flexibility when it comes to future upgrades as new features are released. This means you can add more functions and expand the system to fit your needs. Furthermore, you can choose whether to update yourself or if you would like a professional IT team (which will cost money) to do the update for you.

3) Ability to add peripherals and other hardware devices. With a POS system that is built on your own computer, there will be no limitations as to what peripherals or hardware devices you can add, such as a barcode scanner to capture product information, a label printer for printing your labels, a receipt printer to print out invoices and receipts etc.

4) Ability to expand its capabilities with third-party software. You can also extend the functionality of the POS system using third-party software which will be discussed in more detail below.

Standalone POS System Disadvantages:

1) Expensive to buy and maintain – Since the system will have to operate on its own computer, you would need to invest in a good quality PC that contains enough processing power and memory so as not to affect the performance of your POS system. You will also have to invest in software licenses for your POS software, as well as other peripherals that are required by your business. This can be quite expensive especially if you are using an off-the-shelf solution where the cost is bundled together with all other features and functions which may not be required by your business.

2) Higher maintenance costs – You will also have to invest in someone who can maintain and take care of the system, particularly if you are running a small business which cannot afford an IT team for this purpose. This means hiring someone with specialized knowledge on how to operate and support the POS software as well as keeping the computer in tip-top working condition.

3) Risk of data loss or security threats – As the system is connected to network, there is always a risk that unauthorized individuals might be able to access your information and steal both personal and sensitive company data. This could also happen when the PC goes offline due to technical problems without you realizing it, which will effectively result in data loss.4) Limited capabilities of the system – If your business needs additional or more advanced features for your POS system, then it will be difficult to add them yourself. Should you need new modules that are not currently available within the primary software package, you might have to look elsewhere and pay extra costs to have them installed.