POS System: Advantages and Disadvantages

What is a pos system?

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If you’re in the market for a POS system, you might be wondering what the advantages and disadvantages are. Backed by our nearly 15 years of covering the market, we’ve prepared this breakdown on POS systems so you know exactly what you’d be working with. 

Cutting to the chase, the advantages of POS systems include better customer service, easier team management, increases sales and much more. However, it has disadvantages such as security risks, costly pricing and vulnerability to malware.

If you’re itching to get matched up with the right POS system for your business, you can use our free quote tool. You just need to give us a few brief details about your needs, and we’ll find the right providers for you. They’ll then be in touch with tailored, no-obligation quotes for you to compare.

Advantages Disadvantages 
Better customer service Costly prices
Easier team managementReliance on your internet connection 
Saved time Malware infections 
Multi-store systems Security risks 
Increase sales Upgrades 

Top 5 Advantages of POS Systems

1. Better Customer Service

Giving your customers a great experience leads to greater customer satisfaction, which keeps them coming back. Choosing a great POS system helps to move along a sales transaction faster and more efficiently. POS systems can also be used to offer relevant products to customers, creating more sales opportunities and a tailored experience for your customers. 

2. Easier Team Management

Some POS systems allow you to track employee-related data, such as sales per employee and number of hours worked. This gives you a greater view of your business’s team and helps you plan more efficiently. Using such a POS system helps you understand what and who is working best, meaning you can plan better for the future and provide training and assistance where necessary. 

3. Saved Time 

Using a POS system helps to save time, as POS systems are packed with features that reduce the amount of time you need to spend on admin or mundane tasks. POS systems can help you manage inventory, orders, customer service, purchasing, reports, and more. A POS system can, for example, provide up to date reports on inventory so you can easily stay on top of stock. 

4. Multi-Store Systems 

If you have more than one store, it can become difficult to service each one in the same way. With a POS system, you can flawlessly manage multiple stores. This means that every store can provide the same level of service, efficiency, and ease.

Each location will have their own inventory, with a POS system you can easily manage inventory and stock levels across multiple locations at the same time. You can use data from all locations to figure out trending patterns, track sales, and plan ordering.  

5. Increased Sales

As well as improving customer and employee experience, a POS system can help increase your sales. Some POS systems offer actionable insights into your sales patterns so you can see where change is needed, and track improvements. 

Plus, cloud-based software will continually provide you with the latest tech, allowing you to take new payment methods such as contactless and online payments, opening up more revenue streams for your business. 

Top 5 Disadvantages of POS Systems

1. Costly Prices

Because POS systems come with several functions – a lot more than a traditional cash register – they’re a lot more costly. POS systems typically cost around $1,700 for an upfront investment and then around $1,400 per year to use the software. Because of that, if your budget is limited, you might find that it’s best to opt for manual methods or a cash register for now. 

As well as being costly to purchase, if something goes wrong, such as a hardware malfunction, it can also be expensive and time-consuming to repair and replace. That said, on the cost front, going for an iPad POS system is a good idea if own one of those devices, as you won’t have to shell out for more equipment that way.

Despite this, using a POS system helps you increase your revenue in the long run. You might have to invest at first but your business will reap the rewards in the form of increase sales, revenue and efficiency. 

2. Reliance on Your Internet Connection 

To run a functioning POS system, you’ll need a reliable internet connection. If your store doesn’t have the best connection, a POS system may be tricky to run smoothly. This is particularly true in the case of mobile POS systems, which rely almost exclusively on mobile data.

Thankfully, many POS systems have an offline mode which means you can bypass this issue completely. When hunting for your shiny new POS system, check to see if this is an included feature. 

3. Malware Infections 

Like any internet-based system, a POS can be infected with bugs or malware, which  can stop it from working. This can throw a huge spanner in the works. There are of course ways to prevent this, but there’s always a small possibility that it could happen. If it does, it can be costly to fix and prevent your customers from making purchases until it’s sorted out. 

4. Security Risks 

For customers who use their cards to make a purchase, it can be a risk when they have to enter their PIN, as this could be exposed to others.  Some POS systems offer preventative measures, and with the increasing use of contactless payments, this can be avoided. However, as many customers will still use their PIN to make purchases there’s still a risk of damage to your business’s reputation. 

If you find that your business is in a location where lots of people use their PIN to make payments, you should seriously consider investing in a POS system that has extra security to prevent this from happening. 

5. Upgrades

POS system providers will often come out with upgrades to improve the system, which is great – however, it means you’ll often have to pay for upgrades. You’ll also have to purchase new licences and software, which can be time-consuming. Some providers do offer free upgrades and support if you need it, so if you’re looking for a provider, check to see that they offer this. 

Next Steps

POS systems have both advantages and disadvantages, but we recommend investing in one for your business despite the drawbacks, such as it being costlier than other methods and security risks. The advantages of POS systems mean your business can run more efficiently, provide better customer service, and increase sales. 

Your POS system can run a ton of functions automatically, taking a load of work off your back and ensuring you can stay on top of various aspects of your business, such as managing inventory, orders, and employees. 

If you’re ready to shop for a POS system, you can use our free quote tool to be matched up with POS system providers. With a few brief details of your business, we can find the right suppliers for your business. You’ll be contacted by the best providers for you with tailored, no-obligation quotes that you can compare. 

Written by:
Zara Chechi
Zara is a Payments Expert, specialising in writing about Point of Sale systems. With a Law Degree from City University of London, she has used her legally-honed research and analytical skills to develop expertise in the Business Services world. Featured in FinTech Magazine, she quickly became an expert in payroll, POS systems, and merchant accounts.
Reviewed by:
Ruairi uses his 3+ years of research experience to uncover insights which can help Expert Market provide the best business solutions for their users. He has done this by meeting with business owners to find out what is important to them and what challenges they face on a daily basis. Ruairi specialises in tools that can be used to grow your business and has done research for a wide range of categories on Expert Market, such as EPOS, Website Builders, and Merchant Accounts.