Top 5 point of sale purchasing mistakes and how to avoid them
So your customer wants to buy a new point of sale system. That’s great!
But when you put yourself in the merchant’s shoes, it’s also a decision that can feel overwhelming. With all the options out there, how do they know which one to choose? How do they know which one not to choose?
That’s why as a dealer, your merchant looks to you to lead them through the process of finding the right POS for their business, whether it’s their first time buying or they’re looking to upgrade.
It’s a big role you play. And we know you already have a pretty full plate. So to offer some extra support, we’re providing a guide to help you steer your merchants away from the most common pitfalls of purchasing a POS and win a stickier portfolio in the process.
Read on to dig into these five point of sale purchasing mistakes, so your merchants don’t have to make them:
- Letting the price tag alone dictate the decision
- Not prioritizing POS features and functionality
- Focusing on the short term
- Sacrificing customer service
- Forgetting to consider compliance
POS buyer’s guide: how your merchants can avoid these mistakes and buy smarter
Letting the price tag alone dictate the decision
Small business owners are already dealing with the daily stress of juggling all the costs that come with running a business. So, in the search for a new POS system, it can be tempting to go for the most attractive price tag.
While cost is a big part of any purchasing decision, it’s not everything.
Despite the appeal of a bargain, caution your client to avoid the pull of the cheapest solution. Encourage them to consider and invest in important features, like built-in functionality, scalability and security.
While expensive does not always equal better, choosing a low-priced POS system to save a few bucks isn’t always the happily ever after it promises to be either — it could end up costing your merchant more than they saved in the long run.
It’s also important they know exactly what the price tag includes and that it may not reflect the total cost of ownership. Ever met someone who loves being surprised with hidden fees? Neither have we.
Make sure your merchant is aware that the initial price of the POS — whether buying a legacy system outright, purchasing a cloud-based software license or paying a monthly SaaS subscription fee — isn’t the only thing they’ll need their wallet for.
When outlining the total cost of ownership for your merchant, don’t forget to include these factors:
POS terminals and peripherals
POS implementation services
PCI security protection and remediation
Internet service fees
Credit card processing rates and fees
While helping your customer understand the complete POS system pricing picture is a critical first step, there’s something even more important than price: return on investment. A POS system with strong profitability will save your merchant time and money, ultimately paying for itself over time. How’s that for a cost-effective solution?
Not prioritizing POS features and functionality
Have you ever signed up for something that seemed great at first glance only to find out you really didn’t know what you were getting into until it was too late?
The same scenario can be true for a POS. It might look great on the surface, but when you dig a little deeper, what functionality does it really have to offer? Many-a-merchant have failed to identify which features are included versus added on before setting up their shiny, new POS only to find it wasn’t looking quite so shiny the next day.
Enhancing your POS with advanced technology integrations can be great. But having to go through a third-party aggregator for critical POS features like reporting and inventory is another story. More disjointed add-ons for basic functions means more moving pieces, an escalating price tally, complicated staff training and the frustration of your POS system not working simply and smoothly.
So much for that attractive initial solution.
When searching for the right POS system, make sure your merchant is comparing features carefully and that their top choice actually possesses the functionality they require. Let’s look at some features beyond accepting contactless payments that a modern POS should include at no additional cost:
Not all POS reporting features are created equal. Many POS systems come with built-in canned reports while others allow the flexibility to create special reports. Determine what level and type of information your merchant needs to stay on top of how their business is performing. (Pro tip: Ask for a demonstration!)
Customer relationship management
Who’s your merchant’s target audience? Their POS could tell them. But to tailor the customer experience to specific groups with personalized promotions and loyalty programs, their POS must first have customer tracking capabilities or a built-in CRM that provides data-rich customer dashboards, custom fields and integrations with top loyalty and marketing platforms.
There’s no task more tedious — or avoidable — than spending the day manually taking stock of inventory. Nor is there one more mortifying than promising something to a customer that’s actually out of stock. Your merchant’s POS should include automated inventory management that keeps track of what’s in stock in real time and streamlines forecasting future purchases.
What niche POS features unique to your merchant’s industry might be helpful to running their business? Beware of one-size-fits-all solutions. Whether they need a restaurant POS system or one for a retail store, look for a POS that’s designed to meet the needs of their industry while still offering support for the versatile workflows an expanding business might move into.
These days, a POS is so much more than a cash register. Your merchant shouldn’t have to change how they do business for a POS that doesn’t have the functionality they need.
Don’t let them settle. What are your merchant’s top five must-haves? Are they included? No? Then keep looking! They’ll thank you for it later.
Focusing on the short term
In the age of instant gratification, we all get sucked into short-term solutions that make us feel good in the moment. Binging shows on Netflix, fast food drive-throughs, next-day delivery, hitting snooze on the alarm clock …
But when it comes to purchasing a POS, it’s crucial for your merchant to think beyond the now. A POS is something that should endure, evolve and scale with their business.
You can’t know what the future will hold. But you can ask your merchant to picture what they want their business to look like 10 years from now. Are they a one-location brick and mortar retail shop, for example? Do they plan to take their business on the road as well? Expand to multiple locations? Branch out to incorporate new verticals?
If your merchant’s 10-year plan involves any of those things, their future business needs are going to look very different than they do today — down to the number of stations they’ll need to add, whether a mobile POS with a card reader and app, a standalone register or a combination of terminal solutions is best, and what other POS hardware peripherals they’ll require.
Your merchant’s POS should be the last thing getting in the way of their long-term goals.
Be sure to look for these two traits in the POS technology in question to determine its scalability:
Entrepreneurs are growth-minded go-getters, which can often lead to folding new verticals into their business as they seek to attract more traffic. Some POS applications only support a single vertical with highly specific workflow procedures pre-programmed into the system. This works fine — until your merchant decides to change their business model by adding a bar or merchandise store to their quick service restaurant. POS software built from the ground up with multiple verticals and business processes in mind will allow your merchant to grow without restraint.
Multi-store or omnichannel capabilities
Even if your merchant is only operating from one location or channel today, be sure to ask if others are on the horizon. If they plan to become a multi-location business, capabilities like multi-channel inventory management, the ability to scale up or down seamlessly, cross-platform accessibility and real-time data stored in the cloud should top their list. In short, they’ll need a POS system that empowers them to expand their SKUs and sell anywhere.
Being the partner who doesn’t just fit your merchant with a solution that works today, but instead takes the time to consult with them and find the custom solution that will best support their tomorrows, could just earn you a client for life.
Sacrificing customer service
We’ve all experienced less-than-desirable customer service.
Phone calls that lead you in circles, waiting on hold for hours only to be put in touch with the wrong person, or even worse, not being able to get in touch with anyone other than an automatic voice recording. Cue the urge to pull out your hair, throw your phone across the room and hide in bed the rest of the day!
You don’t want that for your merchant. So don’t let them neglect to put top-notch customer service at the top of their POS shopping list.
Remember: When they choose a POS system, they’re not just buying a product. They’re also choosing a long-term partnership with their provider — one you’ll likely be in charge of handling.
As with any true partnership, you need someone who will be there in the good times and the bad.
It’s true, your merchant might save money upfront by purchasing the components of their POS system separately and installing the software without hiring a solution provider. But the downside of this is that the burden of technical support and training then falls squarely on their shoulders — or rather, yours.
What happens on the day there’s a system failure? If something goes wrong with a POS, it’s typically not a problem the merchant can quickly fix themselves. The recovery process can be complicated and time-consuming since POS systems require specialty equipment. And lost time means lost money for your merchant.
On a day like that, low rates won’t do your merchant any good. Reliable uptime and quality customer service will. Ask the provider these questions to explore the scope of support you can expect:
What does their technical support look like?
What type of warranty repair do they offer?
What logistical challenges will have to be addressed?
How much time will it take to get back up and running?
What is the recovery process if a peripheral fails?
Are support services included or billed as an extra fee?
Is customer service offered 24/7?
Part of helping your merchant find the best solution is having them think through the worst case scenario: Will their POS provider be there for them — and you — when times get tough or are they a fair weather friend? Find out before the day something goes wrong.
Forgetting to consider compliance
Stolen data. Steep fines. The uphill struggle to recover lost capital, reputation and customer trust.
You guessed it, we’re describing what happens when a small business gets hacked by a cyberattack. Despite the serious consequences, many merchants forget to prioritize compliance when shopping for a POS.
If your merchant isn’t sure what compliance means for them and their business, it’s a good idea to help them understand its relationship to security.
Cyberattacks on merchants are disturbingly common, with 43% targeting small businesses. And being non-compliant could cost your client a data breach, which can mean both financial and reputational ruin.
The POS system your merchant is considering should offer comprehensive card data security solutions including compliance with PCI-DSS requirements, end-to-end encryption, data tokenization and extra support from the provider to help navigate complicated compliance requirements.
Need even more reasons to ensure your merchant goes with a POS that will help them maintain compliance? They could face steep fines from card brands, merchant processors and acquiring banks if they’re found to be out of compliance, ranging from tens to hundreds of thousands of dollars.
The bottom line: While conventional server-based systems are still on the market, cloud-based, PA-DSS-validated POS systems that are built to update with any future security standards to prevent emerging data compromising attacks offer more security.
For additional peace of mind, consider providers who take security one step further with a breach warranty.
Choose a partner to grow with
Your main goal is to build up your business.
And making your customers’ businesses grow is what makes your business grow.
At Heartland, we can help you find the right solutions to achieve just that. Learn more about the Heartland Dealer Program and how we can partner with you to provide the secure, reliable, cost-effective POS solutions your clients expect.
Our secret to success? We want your merchants to succeed. And when they do well, chances are they’ll keep coming back to you for the value you provided in the past. Plus, as you well know, there’s no better referral system than happy customers.
Contact us today to find out how partnering with us will help grow your business.
Heartland is the point of sale, payments and payroll solution of choice for entrepreneurs that need human-centered technology to sell more, keep customers coming back and spend less time in the back office. Nearly 1,000,000 businesses trust us to guide them through market changes and technology challenges, so they can stay competitive and focus on building remarkable businesses instead of managing the daily grind. Learn more at heartland.us