To run an online store, you need specific capabilities, typically obtained through software applications. These capabilities need to interact with each other. For instance, a point-of-sale (POS) system not only records purchases but also provides information about what was sold (to manage inventory) and to whom (to manage customer relationships).
There are numerous benefits to having multiple capabilities integrated into a single system, including improved efficiency and better decision-making. Here’s how to make the most of retail software.
What is retail software?
Retail software is a tool designed to assist with the typical processes of owning and operating a retail business, including inventory management, accepting in-person payments, tracking sales, and managing customer data.
Before the advent of computers and the internet, companies performed these tasks separately and manually, entering sales numbers into ledgers, writing out and mailing order slips, and using punch clocks to manage employee schedules. Retail software streamlines many of these processes, providing a centralized system to reduce human error, improve efficiency, manage operations, and increase profitability.
Today, retail software solutions range from point-of-sale (POS) systems to comprehensive retail management programs that integrate with other business applications. Most retail software today can run on a tablet, smartphone, or computer.
Benefits of using retail software for small businesses
Retail software has capabilities that streamline many different types of processes retail businesses require. Here are just a few of the ways they can give your small business a leg up:
- Customer service. Retail software can automate customer engagement by sending targeted emails and tracking purchase history, preferences, and feedback to provide a more personalized experience and build stronger relationships. Streamlining many tedious processes required to run a business can also give you and your staff more time and energy to serve customers.
- Real-time information. Retail software can help to calculate up-to-the-minute sales, track inventory, and record order data. Retail software also improves inventory management by automatically tracking stock, generating purchase orders, and identifying slow-moving items. Real-time data can help reduce overstocking and minimize the risk of stockouts.
- Centralization. With all the information at your fingertips, you can make decisions informed by relevant and up-to-date data. Retail software replaces the filing cabinet with order receipts and a separate logbook. You can make decisions based on relevant and up-to-date information by bringing all these different elements together in a single, integrated platform. Centralization saves time and cuts potential waste.
6 types of retail software
- Point-of-sale (POS) systems
- Payment processing software
- Customer relationship management (CRM) software
- Inventory management software
- Marketing automation software
- Ecommerce platforms
Different types of retail software do different jobs. Here are some key features you may want to look for when choosing your application:
1. Point-of-sale (POS) systems
Point of sale (POS) systems handle all the processes involved in accepting in-person payments, functioning as the modern equivalent of a cash register. These systems cover the basics of calculating sales totals and producing receipts. However, more advanced systems like Shopify POS can include features to manage inventory, track customer behavior, and collect customer contact data (i.e., emails and phone numbers) for future promotions and discounts.
2. Payment processing software
Payment processing software manages and processes financial transactions. It typically integrates with a POS system or ecommerce platform. For example, Shopify POS comes with integrated payment processing from Shopify Payments. To remain flexible, look for payment processing software that’s effective in-person and online and keeps up with contactless and digital payment trends, such as tap-to-pay cards or mobile wallet apps.
3. Customer relationship management (CRM) software
Customer relationship management (CRM) software helps you manage interactions with customers and prospects. CRM software lets you do things like track customer purchasing behavior and send automated and personalized promotional material. Collecting customer data is critical for retention and engagement.
4. Inventory management software
Inventory management software helps retail businesses track what they’ve sold, what they have in stock, and what they need to order. Good inventory management software can automate processes, letting you automate ordering, set low-stock thresholds for reorders, and schedule alerts for stockout or overstock scenarios. Inventory management software can also compare up-to-date sourcing prices, which can help save you money during market fluctuations.
5. Marketing automation software
Marketing automation software like Shopify Flow automates marketing tasks and workflows, helping you to engage with customers and prospects. It can include email marketing, social media management, and lead-generation features.
Modern marketing software can use data to personalize marketing experiences for existing customers or develop target campaigns for new markets. Automated marketing software can provide feedback and analytics on the success of a campaign, including metrics such as key performance indicators (KPIs), returns on investment (ROIs), and the campaign’s effect on sales performance.
6. Ecommerce platforms
In a world where digital sales represent a crucial marker for most companies, ecommerce software like Shopify have made it easier for businesses to get in on their slice of the internet pie. They allows you to create a digital storefront with the features you need to sell your goods online, and can include various tools, such as website design, shopping cart functionality, payment processing, and inventory management.
Traditional ecommerce software is a standalone application. More advanced versions use modular architecture and application programming interfaces (APIs) to integrate with third-party systems, providing more flexibility and customization options.
5 key features to look for in retail software
- Sales tracking and reporting
- Inventory management and tracking
- Customer management and engagement
- Marketing and promotional tools
- Integration with other business systems
Retail software offers many tools to help manage and streamline your operations. Here are a few notable features to look for:
- Sales tracking and reporting. Real-time sales data is essential for accurate inventory management, effective accounting, and informed business strategy decisions based on current trends and customer demand.
- Inventory management and tracking. Over- or understocking inventory can result in unnecessary costs and financial losses. Solid inventory management software can help avoid this by ordering exactly what you need when you need it.
- Customer management and engagement. Customers are your company’s lifeblood. Dedicated software can improve customer engagement and retention through automated marketing, data gathering, and analytics. Retail software also helps you improve customer relationships by streamlining other aspects of your operation, allowing more customer-facing time.
- Marketing and promotional tools. Personalized email campaigns, targeted promotional materials, and tailored customer loyalty programs are just a few ways retail software can strengthen your company’s marketing game.
- Integration with other business systems. Look for software that easily integrates with your other systems—for example, POS platforms that connect with inventory management systems, and ecommerce software that marries with payment processors. The more the different parts of your business talk to each other, the better off you’ll be.
Top retail management software
1. Shopify POS
Shopify POS is a retail management system that’s fully integrated with your Shopify ecommerce site. Shopify POS is flexible and helps merchants manage their entire business—inventory, sales, customers, orders, products, and more—from one platform. With mobile POS hardware like POS Go, retailers can sell anywhere their customers are, using one handheld device.
2. Oracle Netsuite
Netsuite is an all-in-one option with an enterprise resource planning system (ERP), accounting, inventory and supply chain management, and CRM. Netsuite is cloud-based, letting you access data and analytics, and control various processes from anywhere. Although Netsuite has a wide range of utilities, the number of modules may be unnecessary for some smaller and medium-size businesses (SMBs).
Sumtracker inventory management software lets you monitor your goods across multiple locations, set low stock alerts, and reorder thresholds. It keeps track of historical data to generate days-of-inventory-remaining reports and allows you to receive partial stock against your purchase orders. Sumtracker also integrates well with other retail software platforms such as Shopify.
Retail software FAQ
Can retail software integrate with other systems?
Yes. Many retail software applications can integrate with other parts of your business, including accounting software, employee management software, or marketing platforms. Integrating these aspects of your business can streamline operations, saving you time and money.
Is retail software typically suitable for businesses of all sizes or better suited for larger enterprises?
Retail software can be suitable for businesses of all sizes, not just larger enterprises. It can save time and improve accuracy, allowing you to focus on other areas of your operation. For example, a retail POS system can help expedite transactions and boost sales, giving you more time and resources to spend on product design. Ultimately, the suitability of retail software depends on your specific needs and requirements.
What is retail CRM software?
Customer relationship management (CRM) software is an application that collects customer data, such as purchase history, preferences, and personal information. CRM can be used for targeted marketing campaigns, to improve customer experience, or for new lead generation.