How To Choose the right Point Of Sale System!
This article could save you thousands $$$$$$
Over the years I have seen hundreds of retailers select the wrong POS system and many have selected the wrong one many times over. The actual cost of the wrong selection could be much more than you think.
The cost includes the following list-
Physical training cost
Hidden training cost
Staff re training
Stock take errors
Management lost time
Poor stock management
Much much more...
The time costs for your business will usually be more expensive than any other function and many times this has cost the retailer his or her business.
The Do's and Don'ts the wrong selection will definitely cost you thousands.
Don't buy hardware first.
There are a number of reasons not to buy hardware first and if you have already purchased hardware you limit yourself to less software choices, and if your hardware is older than 2 years seriously consider renewing some or all of it as this cost at the end of the day will be less expensive than the future problems you will encounter. The POS system drives your business and the limitation of choices can cost you dearly, POS systems are very different in the way they operate and although they all do similar functions they do them differently for example bar codes and the creation of bar codes are almost like chalk and cheese between different POS systems.
In over 70% of cases Retailers with existing hardware will have problems with there POS system and especially where a network is involved (more than 1 computer) these problems may on the surface appear to be software problems then the software vendor will come in charge you and tell you its a hardware problem, then the hardware vendor can come in and tell you its a network problem then the network vendor will come in charge you and tell you its a software problem and at the end of the day you have spent a lot of money and still no result. At the end of the day it will cost the retailer unnecessary money even though his brother in law can supply hardware at a low price. There will be no savings only headaches and costs. You don't want to restrict yourself to the wrong operating system so select your POS software first as this is the single biggest selection criteria!
Don't ask the wrong people for advice
All to often retailers will ask there local computer store about what they should buy for their business and the majority of computer stores even though they mean well have no idea how a retail business works and especially yours. The local computer store may suggest one or two software programs as that is all they know about so they don't feel comfortable recommending something they have not heard about. Most computer consultants have the right intensions but they tend to give poor advise and how could they recommend something they do not know about. Your Accountant will as a professional, offer you advise about an accounting based system and not about a stock control, management or purchasing system, generally your accountant will only recommend one or two choices and they will generally be the low priced accounting packages. Remember the wrong software choice is easier than the right one and a mistake will cost you thousands!!!!!
They don't place enough focus on the software vendors importance and knowledge.
When you buy software you are not just buying a product you are also buying a relationship and the right relationship can make you a lot more profit for your business. Also the right software may be available from more than one supplier and you can get completely different results from different vendors on the same product, experience and knowledge will make you the most profit. The way the software is set up for you business can vary considerably and the difference can be your businesses profitability and future growth. Don't underestimate the right software vendor and the difference they can make to your business.
Evaluating a Point of sale software vendor.
How long has the software company been around? are they using the right software architecture that will reduce your costs over time? What is the process for an upgrade? what is the cost of future upgrades? Can reports be customized? Many point of sale systems collect information but will the reports assist in improving the profitability of your business? Are multiple locations available for future expansion? One important word of warning beware of Vaporware! and that is where a feature or a range of features you need to run your business are not available but the software vendor says they are coming in a new upgrade! if you can not see it its not there don't buy it. If you have a problem how long will it take to fix it? What is the process of fixing bugs ? all software has bugs and don't believe anyone one says they do not. Will your system be set up correctly to incorporate future expansion? Remember no software will be 100% perfect for your business and if that happens its a bonus. How will they provide training? what are the ongoing costs? Do they have a good track record?
Don't underestimate the cost of data importation.
Often data import can cost more than the software you are buying! as you may have an old DOS system that has poor architecture and the internal fields do not export correctly and even if they do will they match the fields and the field sizes of the new system and what is involved in making them right and will there be a mistake? what can you expect? You cannot ever expect 100% correct data transfer from your old system to the new system and you must seriously weigh up the possible cost of import Vs starting from scratch. what will be the time frame either way? how will it effect your business and how long before you have stock control? A good example is the apparel business where there are sizes and colours an old system may not have handled this correctly and the export of data would give you a separate item per size and per colour then this would seriously effect your reports, beware of the advantages and the disadvantages before you start.
Don't pass the Buck!
Too many retail owners give the responsibility of selecting a POS system to an employee or a consulting firm that do not understand your business. This is a huge mistake that will cost you thousands. Because you may not understand computers 100% you do not feel comfortable with this decision but it is extremely important you overcome this problem, the best way to think of a computer system for someone who does not understand is that all you are doing is collecting information and replacing your paperwork with a computer system that eventually will reduce costs and improve efficiencies. The person who evaluates the software must have a complete understanding of the business and how it works, test it by saying how would I do this function on the computer. The difference for your business in cost savings and improved productivity can be astonishing.
Many retailers select a POS system the same way they purchase goods.
As many retailers are told by the software vendor that our system does the same as all the other systems and its less expensive so they select on price. This is a big mistake and will cost you thousands extra. software systems are chalk and cheese and it is extremely possible that a system that costs an extra $10,000 is less expensive than the system that is cheaper, how is this possible? In most businesses the 2 largest costs are stock and staff after rent is taken out. A system that costs say $2000 could easily cost you and additional $10,000 or more in hidden costs for staff to maintain it in the first year alone and you don't get the savings you anticipated and many retailers have purchased a system and they would have been better of keeping the cash register as all they have now is a fancy cash register that gives no benefit to the business. Where a system That costs you say $10,000 could save you thousands in staff costs and efficiency so the cost in the first year could be much less than the less expensive program and this is just one example. If you are serious about improving your business there is a dedication factor you must allow for to get to the level where Automation takes over.
Will you manage your business or will it manage You?
Will you be one of the 80% of retailers with a POS system that is no better than the cash register?
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