7 Ways to Maximize Your POS Software
Return on Investment

For any business owner the purchase of a product, no matter how large or small, is an important decision.  Questions need to be asked.  Will your purchase result in more sales?  Will it save time?  Improve the image of the store?  Will I see a return on investment?

Purchasing a retail management software system is no different.  In fact, when choosing a point of sale software or retail management system, the first question you should ask yourself is:  Will I see a return on investment?  If so, how much? 

Generally, one of the main reasons for investing in a point of sale software system is to save a business time and money.  These time and money saving features have a direct effect on Return on Investment. 
Here’s how:

Sample ROI:

Initial software, hardware, and training costs:  $10,000
Monthly support fees: $100                                                                       
Costs during first year:  $11,200

Lowered inventory costs during first year:  $20,000
Yearly time savings / lower labor costs:  $10,000
Additional yearly sales (from reduced run-outs, improved marketing, etc):  $10,000
Increased profits during first year:  $40,000

Return on investment after one year is:  $28,800

This is an oversimplified example but hopefully this gives you an idea how to determine your ROI. 

Maximize Your Return on Investment

A good point of sale software will enable you to increase your sales with features that enable you to track customer purchasing habits, which mean better opportunities for upselling and targeted customer promotions.  Your software can make it easy to offer customer loyalty cards and loyalty programs. All software programs should make your customer’s check out and return process easy, which means they are more likely to have a pleasant shopping experience and return for future purchases.

A richly featured POS product will also make it easy to streamline your processes by integrating your pos accounting software tasks like accounts receivable with your point of sale software, automating purchase orders and inventory control systems, and speedy check outs with electronic signature capture and integrated debit/credit card processing.

You’ll also be able to increase your marketing with the customer retention marketing features that allow you to send targeted promotions to your best customers.  Using customer tracking and marketing features you can also send birthday cards to customers and even discounts to select groups of customers. 

In addition to valuable time saving and money saving features, to make sure you’re getting the most software for your dollar you should also consider the following:

• Take time to evaluate the software company’s customer service policies and procedures.  Are they available 7 days a week?  Do they have a good reputation for returning phone calls in a timely manner?  Do they offer a training program that meets the needs of you and your business?  When you’re purchasing Retail Management software you’re not just purchasing a product, you’re purchasing a commitment. 

• Make sure that the POS software company has a solid standing and a predictable future.  This means that they have been in the business for a long time, have a good number of customers, and they are growing.  This is important because you’ll lose money if the company goes out of business and you have to replace your system, which will cost a lot and thus have a direct effect on your original return on investment.

• When you’re shopping with your wish list make sure that you look at software that is designed for your industry.  Every retailer has different needs and not every system offers features to meet those needs. 

• In addition to an industry focus, you’ll want to find a software package designed to the size of your business or tier because it will have features specific to your size.  Retailers are categorized into tiers according to the number of employees they have and their annual sales. 

To make sure that you’re purchasing the software that is best for your business, the software that will save you time and money AND result in an increase in profits, always speak with sales associates, ask questions, and request demonstrations of software packages before you buy.  There are many considerations when purchasing point of sale systems but if you keep these 7 criteria in mind you will go a long way towards amplifying your return on investment. 

Jeff Haefner, is the author of The Point of Sale Software Buyers Guide, The POS Software Comparison Chart and Retail Technology Newsletter.  He has been working with computers, retailers and POS software since 1993 and he runs a retail technology consulting and software selection service. For free tools and information about POS software and retail technology, visit http://www.possoftwareguide.com/freestuff.html.