As a retailer, you know that your point-of-sale (POS) system is more than just a tool to process transactions but rather an asset to help your business improve both profit and operations by leaps and bounds. With so many POS options available, it’s easier than ever before for merchants to have access to even more data and efficiencies to help their stores become as successful as possible.
Collecting data and creating more streamlined operations for your business is one thing. Reacting to this data and applying it to your operational efforts is what separates good retailers from great retailers.
Incorporating POS strategies into retail operations offers merchants the opportunity to increase sales while staying competitive in today’s modern marketplace. Collectively, these efforts offer retailers the chance the be more proactive and more precise in their immediate and future inventory and operational needs – including customer care. Beyond this, POS data can also contribute a variety of benefits for merchants.
Below, we outline how you can increase sales by collecting and applying POS data.
1. Incorporating Seamless Experiences Thanks to POS Data
Delivering seamless and integrated shopping experiences across all touchpoints has become the standard expected by today’s modern customers. The savviest of retailers have recognized that creating and maintaining a consistent customer experience both online and offline is a must. In order to do this, it’s critical that merchants collect and analyze data across different channels – ultimately allowing them to gain clarity to their collective customer experiences.
Fortunately, technology today makes this possible. And this technology begins with using a POS that is connected to all the touchpoints of a retailer’s business. An example of this includes if a boutique sells something in their store – then generates online sales just moments later and the inventory is updated in real-time so that there is no miscommunication of available inventory left to sell.
Retailers who are using POS data to connect what’s happening online and in-store give themselves a competitive advantage. Yet this isn’t even the best part. What is? This technology doesn’t force users to be metric mavericks in order to understand retail insights. Instead, users can simply run POS reports and find out everything from the busiest times in their stores to optimal stock levels and more — all which improve customer experiences and sales.
2. Reviewing and Reacting to Data Collected From POS
According to Wasp Barcode’s State of Small Business Report, almost half of small businesses either don’t track inventory or use a manual method. Keeping this in mind, it’s no surprise that a lot can go wrong. According to Sensormatics’ Global Shrink Index shrink costs retailers more than $100 billion globally each year.
There’s good news to this historic report, however. Using a POS system can help merchants by allowing retailers to:
- manage inventory counts
- check stock levels at different stores
- transfer stock
- manage returns
- automate reorder points
- gain product and customer insights
- make staffing decisions
- and more!
Since a POS is where sales are actually rung up, it only makes sense that it also delivers insight to sales performance — and more than just what is sold. KPIs like gross profit and the profit margin, for example, are clearly laid out in POS system’s reports allowing retailers to track profitability and make sure their inventory is actually helping generate revenue versus costing their business dollars.
Another advantage of a POS system is that it can help increase sales by reporting what staff members are selling and what days of the month are the busiest – even identifying details as specific as what time of day that sales are the strongest. Thanks to this insight, merchants can then staff their stores accordingly and furthermore, optimize their payroll spend along the way. The result? Increased profit is made available to stores since their operating dollars are being spent more wisely.
3. Using the Cloud to Help Manage POS Operations
A cloud-based POS system is becoming more than a luxury — it’s a necessity if business owners want to increase sales. It can ensure the best possible customer experience while staying relevant to the rapidly changing pace of technology.
With access to a secure, online merchant portal retailers can check inventory, send invoices, and better manage their employees and customers. They can also create and export custom reports. This helps retailers be more efficient with their time. By having access to merchant account settings they ’re able to quickly and easily update information, set up email alerts, order supplies, and much more from any device, anywhere.
And whether you have one store or multiple, the fact that you’re using a cloud-based POS system means your business data is available to you at home, in a coffee shop, or even while you’re on the road traveling. All you need is a computer and an internet connection, and you’re empowered to make important business decisions wherever you are, whenever it’s convenient for you — ensuring a better customer experience and increased sales.
4. Integrating POS With Like-Minded Yet Non-Competitive Businesses
Cloud-based POS system can be extended to add to their capabilities by taking advantage of integrations. Retailers can connect their POS to other platforms (such as accounting software, e-commerce platform, payment processor, etc.) so that key data can flow smoothly from one system to the other.
Integrating a POS with an online shopping cart, for example, allows the systems to sync sales and inventory data so that a merchant can manage their stock across both sales channels. Another example would be if a retailer wanted to integrate their POS with accounting software. Together with a POS, these systems can work together and sync sales and tax information.
To help your unique business benefit from integrations, identify partners your POS system is currently aligned with or if you’re exploring new POS systems, consider which partnerships they have in place. Some POS solutions even have networks of existing experts who can help retailers set up their software and seamlessly integrate like-minded yet non-competitive companies – further extending the value of POS. Ultimately, the more integrated your information is, the better informed your business will be to make decisions that can have a direct impact on the sales and profit of your business.
5. Offer Up-Sell Opportunities Once a Customer Reaches the POS Experience
In addition to the POS being a destination to process payments, it also presents an opportunity for retailers to increase their average units per sale. Keeping this in mind, when customers have made the decision to buy something, this welcomes the chance for merchants to up-sell them on additional inventory. Some ways to include this would be:
- Merchandise impulse-inspired inventory next to the check-out area that attracts customer attention such as candy, beverages, novelty items, hand-sanitizer and other products that do not take much debate over whether or not a customer may need but rather they are items they simply want.
- Keep items merchandised in this space affordable to your unique audience. Typically items that range between $1 and $10 are ideal for this strategic area of merchandising. The reason behind this is customers do not have to contemplate if they should get these items but rather quickly grab them and add them to their check-out experience. Lower, affordable price points help achieve this.
- Aim to offer inventory in this space that has margins – thus, driving more profit opportunity to your store. If you purchase novelty hair accessories for $1 each, for example, but sell them for $5 to $10 each. You increase your chance of driving stronger revenue to your store thanks to stronger margins.
The Bottom Line
Having a strong merchandising strategy near your POS combined with the right POS system can be a game-changer for retailers when used to their full capabilities. The insights provided from your sales data alone offers a valuable look into the inner workings of your business — but you have to use those insights to make informed decisions to truly impact your retail sales.
About the author:
Nicole Leinbach Reyhle is the Founder of RetailMinded and a published author. She is a frequent contributor to The Today Show, Forbes and countless B2B publications. Reyhle is the Spokesperson for American Express’s Small Business Saturday and writes regularly as a retail thought leader for various industry resources and is recognized as a Top 10 retail thought leaders from Vend and a retail “futurist” for IBM. Finally, Reyhle is also the Co-Founder of the Independent Retailer Conference.