Many retailers are switching to cloud-based, or online point-of-sale (POS) systems. They’re making the switch for all different types of reasons from affordability to a better customer experience.
While online POS systems are gaining in popularity, they’re not for all retailers.
To help you decide if you should switch to a cloud-based POS system, we put together a list of pros and cons to use as a guideline when making your decision.
Pros of Online POS Systems
There are many hard-to-ignore benefits of using an online POS system. That’s why many retailers are switching to cloud-based systems that allow them to use tablets as their POS systems.
Check out some of the advantage a cloud-based system has over a traditional POS system ran on a local server.
Improve Customer Service
Retailers are adopting online POS systems to provide their customers a better shopping experience. Online POS systems allow for a tablet to be carried around the store and brought to customers for check-out.
This can speed up the check-out process and eliminate long lines for the cash register. Think of department stores, or bars where customers wouldn’t have to wait in-line to swipe their card. It’s a more streamlined process that makes shopping or buying at your store more convenient.
If you can carry your POS, you can be wherever your customer is. This makes you more accessible to your customers.
For non-traditional retailers who sell beyond just brick-and-mortar shops, you now can check out customers at art festivals, music festivals, pop-up shops, events, and even your own home office with just a phone, or credit card reader.
Let’s face it, not many people carry cash on them anymore. Online POS systems allows you to conveniently provide credit card check out in just about any location. This can help you generate more sales when you’re selling in these types of settings.
Even when you don’t have access to WiFi, most online POS systems have “offline” modes that still allow you retrieve credit card info without an internet connection.
You’ll have access to your sales data wherever, and whenever you want it. You won’t have to be in-store to look at inventory, items, or any other data you need.
Cloud-based POS systems can also be a more affordable solution for SMBs. Traditional local server POS systems usually require you to buy software and lots of hardware that needs to be hooked up.
For online POS systems, you usually download an app for free, purchase a tablet or card reader, and then pay a small fee per transaction. Some service providers also require a low, flat monthly fee.
For a retailer just starting out, or who needs only a few registers, this can be an affordable solution so you can start selling right away.
For multichannel sellers, your POS system isn’t the only retail system you use. You might also have an accounting system, Amazon or eBay accounts, or an online eCommerce store.
To grow your business, you’re going to want to integrate all of your systems so you can synchronize your data, such as order, item, and inventory, across all of your systems. This helps you provide a better a customer experience.
To do that, you’re going have to integrate your systems. And, POS systems aren’t the only systems now moving to online platforms.
Being cloud-based usually gives you more options in terms of integration. This is important for the long-term growth of your business.
Online POS systems also can have more reliable support. Most cloud-based servers provide 24×7 support that can be reached anytime for troubleshooting problems. When you do have an issue, you’ll most likely be able resolve it fast. You’ll be back to servicing your customers in no time.
Your software is always usually easier to install on more registers and automatically update. It’s just a matter of installing an app. You won’t need to go through the hassle of contacting someone and shutting down your systems for updates.
Cons of Online POS Systems
Cloud-based systems don’t come without their own list of risks. Make sure you’re aware of some of the reasons why you wouldn’t want to switch an online POS system.
Your online POS systems is available via the internet. This means you’re dependent on an internet connection. You know how fickle connectivity can be.
If you’re constantly battling the WiFi for your POS to work, your customer experience is going to suffer.
While it is true that most system now have an “offline” mode, you still can’t process the transaction until you have connection again. Your POS will just store the information until you regain connection.
This is can pose risks for you. If you have a bad credit card number, or any other problem, you’re not going to know until after the connection is back. By then, your customer is long-gone with the merchandise you sold.
If you don’t have a reliable internet connection, you probably can’t rely on an online POS system.
The service provider is responsible for the security of your customer data, since they’re storing your data for you on one of their servers.
For SMB’s who aren’t technically savvy, you usually don’t want to be in charge of the security of your data. But, some retailers do want that responsibility to ensure they properly understand how their data is secured.
If you want that type of control over data security, than a cloud-based POS might not be what’s best for you and your business.
Local server POS systems aren’t cheap. If you’ve already put significant time and money into your POS, you might not want to scrap them all to switch to an online POS system just yet.
While set-up and installation can be quick, you want to be conscious on what you’re getting for your investment. Is it worth it to rip out all of your current software POS systems?
Cloud-based POS systems can be more affordable. Their low price also can correlate to the amount of functionality that you’re getting. Your online POS system might not have all the capabilities you need to sell to your customers.
Most big-box retailers still rely on local server POS systems because of the robust functionality that they need.
Make sure the online POS system you’re looking into has the features that you need. Don’t sacrifice features just for the ability to be cloud-based.
What to Do Next
Ultimately, whether or not you’re ready for cloud-based POS system is dependent on your own unique business needs. Use this list of pros and cons to help you decide if it’s the right decision for your business.
If you do decide that you want to use an online POS systems, check out this post that compares the top 6 online POS systems. It’ll help you determine which system is best for your business.
As a growing retailer, it’s a tough deciding what retail systems, both POS and others, you need. If you need help choosing what platforms to run your business on, our Multichannel Implementer’s Guide is the guide for you. We compare and contrast the top platforms for POS, ERP, and eCommerce platforms. Check it out below.