Harnessing the power of data and data analytics is vital to creating opportunities for advancement and innovation within the payments landscape – and developers are pushing this notion forward. This month’s edition of the PYMNTS Developer Tracker, powered by Vantiv, examines how developers are helping shape the way payment data is being used to stimulate growth and innovation throughout the ecosystem.
ShutterstockPoint of sale systems can make or break a business.
And when POS systems are unable to bring value beyond simply accepting card payments, they may actually be doing more harm than good to the businesses that deploy them.
According to Eric Elwell, CEO of point of sale solution provider 2TouchPOS, having the wrong fit between a business and the POS system it utilizes can be a recipe for disaster, especially for restaurants, bars and nightclubs, which bring in roughly $700 billion in annual revenue.
In those sectors, research shows that nearly 50 percent of businesses are out of business by the time they are ready to emerge from the “terrible twos” and celebrate their third birthdays.
With pressure to stay current with the latest and greatest technologies coming from both patrons and an ever-growing number of competitors in the market, innovation may need to begin right at the register.
“The battle for market — or stomach — share in the restaurant industry is as fierce as ever. The winners will be those who pursue the right paths to growth and value creation, while reining in costs,” said Eric Dzwonczyk, managing director at AlixPartners and co-lead of the firm’s restaurant and food service practice.
According to the 2016 POS Software Trends Report released by Hospitality Technology, this year is all about embracing disruption at the POS, with the overall sentiment from executives pointing to new consumer expectations for payment, security, mobility and engagement as driving forces for restaurant POS investments. The survey respondents also noted the ability to accept mobile wallets, integration with other systems and tablet-based POS software as the top sought-after functionalities when considering POS upgrades.
“A POS has a huge impact on the restaurant failure rate. Since the POS controls all of the establishment’s product pricing, how the POS is programmed has a massive impact on revenue,” 2TouchPOS’ Elwell explained.
The odds of failure can become significantly increased if the wrong POS is programmed poorly, leading to “nickel and dime mistakes on hundreds of thousands of transactions,” which Elwell said can decimate profits.
Elwell emphasized the importance of creating payment experiences that are both smooth and efficient, which begins with preparing accurate customer bills and ensuring the data is captured and analyzed for precise sales transactions.
While every business owner wants financial growth, Elwell noted that trying to get there without the right data and metrics feeding into the software and hardware that powers the POS just won’t work in the long haul.
Despite the financial benefits an optimized and integrated POS system can bring, a recent study from Software Advice found that nearly 63 percent of operators still don’t have a digital POS system in place.
The idea of deploying an entirely new POS system, or even upgrading what’s currently in place, can leave any business owner with concerns over time and costs, as well as feeling completely overwhelmed with the decision-making process.
In some cases, restaurateurs find it easier to just stick with what they know is working.
The research showed that of the thousands of businesses surveyed, the nearly two-thirds that are lagging behind at the POS are still relying on using a combination of traditional cash registers, credit card terminals and handwritten tickets and receipts.
“There are so many advantages to be gained by adopting a POS system, not to mention the mobility that a restaurant operator can achieve with an mPOS system,” Justin Guinn, restaurant researcher at Software Advice, discussed with Hospitality Technology, noting that almost 72 percent of restaurants are looking to put mPOS solutions in place at their establishments.
“These mPOS systems are having very positive impacts on the bottom line of restaurants who are using them. More than anything, mobile POS systems are leading to quicker dining experiences. This means restaurants are able to turn tables faster and pack more customers (and thus, revenue) into each shift,” Guinn added.
For more on software development trends click here to download the January edition of the PYMNTS.com Developer TrackerTM , powered by Vantiv, a monthly view into the breadth and depth of eCommerce – and commerce-related – software developers.
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