In the next few week’s column, I want to talk about selecting a Point of Sale System, or POS for short. Get this one wrong and not only do you waste money, more importantly you waste the opportunity to manage your business better. Whenever we consult with a new prospect, we provide a needs analysis. This involves asking the client a series of questions. We do that for 2 reasons. The first is to discover the pain points with their current system and the second is to determine if point of sale systems are a good fit.
Generally, inventory for sale is the retailer’s largest investment, so you would think it would make sense to make sure whatever system you have in place tracks inventory. I am sorry to say that as someone who sells and supports Point of Sale Systems, our biggest competition is from the plain old cash register. So NO inventory tracking at all. But the retailer will tell me “I can look around the store and tell what’s selling and what I need to reorder” Well a look around the store may tell you what to reorder, but it will only tell you what is gone, not why. You might have internal theft (over 60% of all inventory loss (called Shrink) is from internal theft. A prime example is you have an employee who feels like they are underpaid so helps themselves to merchandise or perhaps they have friends who come in and get the “friend’s” discount. Next up is the loss from external theft. It amazes me the retailers who install cameras, yet still use cash registers as if having a camera will prevent theft.
So, where does that leave us? What is important to the retailer? Here are some of the questions we ask to determine our customer’s needs.
What type of inventory do you have? Do you need to track serial numbers? What about matrix inventory (The same item with different colors and sizes, for example) Do you need to track special orders? Do you want to set reorder points? Do you sell online? What about multiple locations. Do you want to allow the customer to carry balances on account? Once we get the answers to these questions as well as a number of others, we can determine if the solution we offer meets the customer’s needs. If not, we thank them for their time and sometimes we suggest another solution, or perhaps another customisable point of sale system. Just taking the customer through the process helps them to clarify their requirements and benefits both them and us. Too often our customers will choose a system that has been marketed to them or one their friend uses. By a true analysis of the customer’s needs, we as consultants can help the retailer determine what system works best for them, even if that means they don’t buy from us. In our next column, we will talk about the various types of Point of Sale systems out there and the strengths and weaknesses of each.