What is an EPOS system?
EPOS stands for Electronic Point of Sale, and it is a system used by retailers of all sizes to process their customer transactions and ensure accurate stock control.The term is used to describe various software and hardware components that are involved in making a transaction technically possible and tying information about the sale into the back office and stock inventory process.
An EPOS system includes both the till used to take payment and any software that runs on it.
Due to different requirements in different merchant environments, the components of an EPOS system can vary. Typically, hardware elements comprise a cash till, some form of card reader and a screen with a keyboard or a touchscreen. Retail environments will often have a barcode scanner while hospitality environments might have handheld units.
While the term EPOS stands for electronic point of sale, modern EPOS systems can provide support for a large amount of front office and back office processes. A small business might be able to find an EPOS system which enables all necessary business functions and so won’t need any other software.
What are the benefits of EPOS systems?
EPOS systems can perform many functions and bring lots of benefits to a business, as outlined in this short video case study.
This could be a PDQ machine, a Chip & PIN device or a magnetic swipe slit integrated into a keyboard. The type of payment processing depends on the industry of the business.
To process card payments, a merchant needs to have a merchant account.
Most EPOS systems support multiple checkout lanes or payment points and will keep track of the takings at each point in a central dashboard. Using EPOS software and modern equipment make it easy to keep track of daily, weekly and monthly sales and your customers' preferred payment methods.
An EPOS system designed for a retail environment will typically feature some kind of inventory management, whereby a sale registered in the till will automatically update the quantity of the sold item in the stock dashboard.
This makes it much easier for merchants to keep track of their stock and make sure they don’t run out. It also enables tracking of which items aren't selling well and product trends. Some EPOS systems feature customisable alerts for certain events such as stock falling below a defined level.
Staff management is made possible by dedicated accounts for sale points. Any staff member manning an electronic till will sign in to their account, ensuring all transactions are accounted for.
The resulting data can usually be analysed within the EPOS software itself, giving insights into which staff members are pushing the most sales, which products are being sold the most and at what times. Some EPOS systems will also integrate with more complex staff management tools such as payroll software, allowing bonuses to be calculated directly from sales performances.
Customer engagement and satisfaction
Many EPOS systems either directly support customer loyalty and discount schemes, or will integrate with other customer loyalty software programs.
Additionally, an EPOS system provides many ways to increase customer engagement. For example: a thermal printer integrated into an EPOS system can print the company logo onto the customer receipt. Using an electronic, integrated till rather than an old-fashioned cash register will speed up transaction processes and minimise human error, creating a more positive experience not only for the customer but also for the sales clerk.
Many EPOS systems, especially cloud-based and hybrid software packages, will support the eCommerce side of your business. Sales in local brick-and-mortar stores and online sales from an e-shop can be tracked in the same system, making it easy to track business development and gain insights.
Most EPOS system will integrate seamlessly with accounting software such as Sage, Peachtree or QuickBooks, exporting your numbers and minimising the hassle of keeping your books balanced. If you prefer a certain accounting software you will need to check the integration capabilities of your chosen EPOS system or software bundle. Some are very flexible and will integrate with all of the most popular accounting programs.
There is a wide range of EPOS system suppliers on the market, with some supplying hardware or software only and others providing EPOS-in-a-box packages or bespoke integrated systems. The type and number of components you need depends on your business requirements.
Factors that can affect the components you need are:
- The size of your business
- The industry you are in
- What back office functionalities you demand of your software bundle
Pre-packaged systems are usually quite basic, although some suppliers offer systems tailored to a certain industry, in which case industry-specific components like handhelds, barcode scanners or weighing scales might be included.
Typical EPOS system components are:
- Visual display unit such as a screen or touchscreen
- Cash drawer
- Chip & PIN or PDQ machine
- Receipt printer
Other components, depending on the system setup and the industry, could include:
- Handheld terminal
- Barcode printer
- Barcode scanner
- Weighing scales
- EPOS keyboard
An EPOS software bundle will need to be installed to ensure all components are running correctly, all data is captured and integrated correctly into the central dashboard, and to enable back office functionalities and data analysis.
EPOS system software
The hardware is nothing without EPOS software – the proverbial backbone, which will be run from your EPOS terminal and turn all your hardware into one integrated system.
As with hardware, there are lots of different software options out there – all designed for different types of businesses. EPOS software that’s been built for hospitality ventures, for example, will differ greatly from that which is run in shops, et cetera.
This is because EPOS software not only enables the acceptance of payments, but also works to streamline your business’ operations on a wider scale using a range of tailored features in one place.
Of course, the hardware is nothing without EPOS software – the proverbial backbone, which will be run from your EPOS terminal and turn all your hardware into one integrated system.
For example, EPOS software for hospitality might enable you to set out table plans, accept reservations, easily rotate between menus, split bills, and send digital food orders to the kitchen. Meanwhile, retail EPOS software might enable you to set up customer loyalty schemes, manage special deals, monitor bestsellers, integrate ecommerce, and create shelf-edge labels.
Of course, there are some common features – generally speaking, all EPOS software will track and analyse your sales and record pricing and tax information, while many will also track inventory, raise stock orders and report on staff performance.
So, not only is a stellar EPOS system vital for accepting payments, it can also prove invaluable when it comes to monitoring progress and strategising for growth.
What are the costs of an EPOS system?
The cost of an EPOS system will depend on the setup and the necessary components. An EPOS-in-a-box system can be very cheap, but if you need extra components it might make more sense to choose a bespoke system from the start.
It is very important to understand your own business needs before you make the final choice on an EPOS system. The hardware and software components can be very expensive and so buying an EPOS system can be a big investment and once you have bought one you will usually run with it for several years.
It is important to know exactly what you need your system to be able to do, because trying to save money on the EPOS system and missing out on crucial features could cost you in lost revenue later. That being said, there are several suppliers offering small, cheap bundles which can be perfectly sufficient for smaller companies.
All options have advantages and disadvantages. Buying can mean a large investment, but the system is yours and you can add or swap components as your business grows. Leasing means you will have continuous payments every month, but installation and maintenance of the system is usually included.
If you are interested in hearing more about prices to buy or lease an EPOS system for your business, then fill out the form at the top of this page and a select group of relevant suppliers will get in touch with you so you can compare quotes for free with no obligation to purchase.