by Bill Fultz
The POS and payments industry has a long history of change
The anecdote “change is constant” is well known, but it’s often understated that change is also frequently hard and complicated. Technology changes are not different from other changing situations in that they rarely make things easier — at least in the interim.
POS technology has been on a relentless pace of change for seemingly ever. We’ve seen client/server solutions change to cloud-based, internet hardware providers. We’ve witnessed how “buy it once” models have morphed into SaaS strategies; and watched brick-and-mortar commerce transform into omnichannel. The list goes on for miles.
With all of this change, it's not surprising merchants often get lost. They need answers from providers with a more deep and nuanced understanding of specific situations; answers that often extend beyond what a Google search can provide.
Rapid change may be unpredictable, but gradual change is inevitable
Making informed decisions is crucial for merchants because those choices impact top and bottom lines. But those decisions don’t always come easily. Complicating things further, new changes rarely come to the hospitality and retail industry, and immediately displace previous solutions.
Instead, it is often a long, drawn-out process in which the old, the now, and the future have to be balanced. Merchants who fail to act promptly find themselves at a huge disadvantage. Last year’s pandemic caught flat-footed merchants who failed to have a strong online business scrambling to survive. But moving too fast also has its risks. Sometimes, investment expenses versus returns can be costly.
The payment world gives a clear example of this situation. There is a lot of noise from folks claiming and betting that cryptocurrency will usher in a brave new world of limitless, free commerce, making legacy payments obsolete. But history shows this is very unlikely.
Statements like these were once tossed around claiming that checks would end the need for cash. Credit cards were supposed to end checks. Debit cards were going to phase out credit cards. None of this has happened. Interestingly, this year marks the 40th anniversary of the end of the gold standard. However, gold is alive and well. It’s been used for thousands of years in commerce. Ironically, paying in gold today is about as easy as using cryptocurrency to pay for a Friday night meal. The reality of how we pay for things — with all the technology changes in payments — has produced more complexity and options.
These changes also impact social trends and produce similar outcomes. In 2020, grocery stores went through a change no one thought would happen: They became the primary place consumers spent their dollars for food. Immediately, stories and editorials asked, “Is the Golden Age of restaurants over?” However, in April of 2021 things changed again as restaurants took the lead, capturing the greater percentage of the consumer’s wallet for food.
These changes did impact the way restaurant and retail customers purchase goods and services. At Heartland, we saw in-store purchases for restaurants change radically. Digital online ordering volume spiked with over a 600% increase in volume. Since last year, the ratio of in-store to digital transactions has balanced out. But the changes have produced results similar to our currency example. More options equal more complexity and it is far from over.
Delivery services and related technologies are evolving before our eyes
Technology and consumer delivery changes are hard at work in the restaurant and retail sectors. What profitable and quality delivery will look like is complex. The bounty of tablets in a merchant location trying to offer new consumers third-party app delivery services is comical.
Delivery service aggregators struggle to find scalable ways to solve these problems. And while these changes are still being worked out, an increasing number of merchants are looking internally to see how their POS systems can help them manage their world and place them back in control of product delivery.
It’s hard to forecast, but some variation of all these approaches could be the answer. The “delivery revolution” is about as organized as a political revolution. The result might not be known, but the experience is almost guaranteed: a more complicated environment for the business with stratified technology.
VARs should embrace change as an opportunity rather than a pain point
As frustrating as this is for merchants, it is a problem POS VARs are great at solving. Yes, technology changes are difficult to navigate for VARs. Even for seasoned veterans, it is a challenge. Bringing new staff on can be a herculean effort to grasp the world of POS. This makes growing a POS VAR tough, but not impossible.
A common attribute for successful VARs is communication. Communication within their companies, and with their ISVs partners and other VAR community members is essential. Too often, pride, fear or perceived competition prevents VARs from engaging with one another.
Learning from one another facilitates implementing technology more efficiently and gives context in managing the complex POS world. Ultimately, sharing information and experiences helps VARs provide a deeper value to the merchants they serve. It isn’t a guarantee for success, but it definitely helps navigate the technology changes our industry will continue to produce.
Grappling with constant change can be challenging. But you don’t have to go it alone. Choose a partner that will arm you with the vital insights and technology you and your customers need to thrive. Become a Heartland dealer today: heartland.us/partners/associations/become-a-dealer-rspa