What is a Point Of Sale - POS
A point of sale (POS), or point of purchase, is the place where a customer executes the payment for goods or services, and where sales taxes may become payable, whether it be in a physical store, where POS terminals and systems are used to process card payments, or a virtual sales point such as a computer or mobile electronic device.
BREAKING DOWN Point Of Sale - POS
Points of sale (POSs) are an important focus for marketers because consumers tend to make purchasing decisions on high-margin products or services at these strategic locations. Traditionally, businesses set up POSs near store exits to increase the rate of impulse purchases as customers leave. However, varying POS locations can give retailers more opportunities to micro-market specific product categories and influence consumers at earlier points in the sales funnel.
For example, department stores often have POSs for individual product groups, such as appliances, electronics and apparel. The designated staff can actively promote products and guide consumers through purchase decisions rather than simply processing transactions. Similarly, the format of a POS can affect profit or buying behavior, as this gives consumers flexible options for making a purchase.
Amazon’s concept convenience store, Amazon Go, which deploys technologies that let shoppers come in, grab items and walk out without going through a register, could revolutionize POS systems. Besides increasing convenience, this could enable POSs, loyalty and payments to be rolled into a single customer centric experience.
Benefits of POS Systems
Electronic POS software systems streamline retail operations by automating the transaction process and tracking important sales data. Basic systems include an electronic cash register and software to coordinate data collected from daily purchases. Retailers can increase functionality by installing a network of data-capture devices, including card readers and barcode scanners.
Depending on the software features, retailers can track pricing accuracy, inventory changes, gross revenue and sales patterns. Using integrated technology to track data helps retailers catch discrepancies in pricing or cash flow that could lead to profit loss or interrupt sales. POS systems that monitor inventory and buying trends can help retailers avoid customer service issues, such as out-of-stock sales, and tailor purchasing and marketing to consumer behavior.