Point-of-sale (POS) systems enable retailers to manage inventory and employees, and to process sales. Once a simple cash register, the POS has become a multifunctional hub for retailers, supporting tasks such as omnichannel selling and customer relationship management (CRM).
The success of a retail store depends on its management of sales and inventory, and POS usage is on the rise. The global POS software market was valued at $20 billion in 2022, and is forecast to grow over the next few years, hitting $42.49 billion by 2027.
To choose the best POS system for your business, you’ll need the right devices and hardware. This guide will walk you through the different point-of-sale approaches and how they can benefit your retail business.
What is a POS device?
A POS device is a computerized system that records and tracks sales transactions in a retail or hospitality environment. It typically includes a monitor, a keyboard, and a cash drawer, and can be interfaced with peripheral devices such as bar code scanners, receipt printers, and customer displays.
POS system vs. POS device
There is a certain amount of confusion about the difference between a POS system and a POS device.
- POS devices are the hardware used to run a POS system. They include smartphones, tablets, mobile POS (mPOS), card readers, touch screens, cash registers, computers, self-service kiosks, and POS terminals.
- A POS system is the software used to run the POS device. Essentially a retail management system, in addition to handling sales it tracks inventory and provides access to detailed customer information, both of which help you offer frictionless shopping experiences.
In short, your POS devices work together with your POS system, whether you’re a pop-up shop or an established retail store, to help you sell more.
Types of POS hardware
- Tablets and smartphones
- Card readers
- Bar code scanners
- Customer-facing displays
- Cash drawers
- Receipt printers
- Shipping scale
Let’s walk through the various types of POS hardware you might need for your store.
Tablets and smartphones
A tablet is a mini-computer with a touchscreen, like an iPad. It usually has a flat surface and an on-screen keyboard. Tablets are a sleek, flexible alternative to the clunky, stationary POS hardware retailers have used for decades.
With a tablet, you can:
- Look up products in stock
- Pull up customer profiles and personalize communications
- Process transactions anywhere in-store
- Keep track of inventory
Smartphones, like an iPhone or Android, are also useful in retail. With POS software on your mobile device, you can ring up customers and look up products from anywhere.
With the Shopify POS app, you can scan bar codes on your phone while doing inventory counts and checking out products. Smartphones are also a good option for selling at events and pop-up shops, giving you the flexibility to take contactless payments anywhere.
Learn: The Retailer’s Guide to POS Hardware: What you Need to Take Payments and Run Your Store
Card readers
A credit card reader or terminal accepts credit and debit cards by tapping, inserting, or swiping them. External readers are usually standalone pieces of hardware; however, you can plug a card reader into your Shopify POS device to swipe cards.
The Shopify Dock for Tap & Chip Reader lets you:
- Accept chip and contactless payment methods
- Support card and contactless payments through Visa, Mastercard, American Express, Discover, and mobile payments like Apple Pay and Google Pay
- Protect card data per Payment Card Industry Data Security Standard (PCI DSS) requirements
- Connect wirelessly to your tablet or mobile phone using Bluetooth
- Comfortably hold the device and take it with you wherever you’re selling
Bar code scanners
Bar code scanners read and translate the information contained in bar codes. They are essential POS devices, allowing businesses to quickly and accurately scan products and retrieve information.
Bar code scanners come in two main types:
- Handheld scanners can scan bar codes on products or labels and are small and portable enough to get close to an item’s bar code.
- Larger and more expensive fixed-mount scanners are more accurate and can scan bar codes from a distance.
You can use Shopify-supported Bluetooth bar code scanners to add products to the cart at checkout quickly.
Customer-facing displays
Customer-facing displays are the screens your customers see when making a purchase from you. They can be used to display the items your customers are buying, the total amount of their purchase, and any promotions or discounts that may be applied.
Shopify POS comes with a built-in customer-facing display, or you can choose to use your own device.
There are generally two types of customer-facing displays:
- POS with swivel stand. Both shopper and retailer can use the same device to view items in cart and process contactless payments. These are also easier to travel with when selling at a pop-up shop or if you own a seasonal business.
- Dedicated device. With a dedicated device, cashiers use their own device to ring up items, and shoppers use a different device to pay.
There are a few things to keep in mind when choosing a customer-facing display:
- Screen size: Make sure your customer-facing display is large enough to easily display the items your customers are buying and the total purchase amount.
- Resolution: Ensure that the screen’s resolution is high enough so customers can read displayed items and totals.
- Customizable dashboard: Choose a customer-facing display that lets you regularly update and adjust your screen.
- Wireless options: A wireless POS system is the most versatile. It’s easier to handle, and you can take it with you anywhere.
Read more: Everything You Need To Know About Customer-Facing Displays
Cash drawers
Some 60% of payments in retail stores are made with cash. Any business accepting cash payments needs a cash drawer.
A cash drawer is a box specially designed to hold cash and keep it organized. Cash drawers are usually connected to receipt printers and open automatically when the printer is triggered to print a receipt.
Cash drawers have slots that separate bills and coins by denomination, so you can easily deposit cash and make change. In point-of-sale systems like Shopify POS, you can track your daily cash transactions and balance your cash drawer quickly.
Receipt printers
A receipt printer enables you to print receipts for your customers. Receipts include useful information like items purchased, product prices, tax amounts, and when and where the transaction took place.
Shipping scale
A shipping scale weighs packages before they’re shipped. A business that ships products from its store can use it to calculate shipping costs accurately. Shipping scales come in various sizes, so you should choose one that fits your needs.
Benefits of a POS device
- Better inventory management
- Streamlined checkout
- Improved customer service
POS devices provide numerous benefits for your business, let’s take a look at a few of them.
Better inventory management
Carrying too much inventory can hurt a business’s profitability. POS systems with inventory tracking can lower inventory costs by helping businesses avoid both stockouts and overstocks.
💡 PRO TIP: When you use different platforms to run your online and retail stores, inventory discrepancies are more likely to happen. This can lead to more frequent inventory counts to reconcile differences and ensure stock levels are accurate.
Streamlined checkout
Creating a fast checkout process leads to higher sales and customer retention.
A POS device helps make checkout easier. You can use customer-facing displays to show shoppers their total as you scan. Then they can insert a card in the card reader or, in the case of a POS system with near-field communication (NFC), effortlessly tap their card to pay, which speeds up checkout with minimal hiccups. Goodbye long lines and frustrated customers.
💡 PRO TIP: Shopify POS has a fully customizable checkout experience. Create shortcuts to keep your most-used apps, promotions, and products at your fingertips so you can fly through checkout.
Improved customer service
POS devices help employees provide better in-person experiences for shoppers, which leads to higher revenue.
When staff are able to access real-time information on products and stock levels, they can keep customers informed and have a better chance of landing the sale. Providing inventory insights reduces behind-the-scenes busy work, freeing up staff time to focus more on shoppers.
Choosing a POS device
Let’s examine some of the different factors to consider when choosing a POS device.
Customer management features
One consideration is the customer management features a POS device has. These features help you track, analyze, and use customer data to improve sales.
Some features to look for include:
- Customer profiles: This lets you store customer contact information and purchase history. You can personalize marketing campaigns to different groups, make recommendations, and provide tailored customer service.
- Email marketing integration: Look for a POS device that lets you send receipts via email, follow up with customers, and send campaigns based on purchase history.
- Customizable CRM functions: A good POS will let you tailor CRM functions to meet your business’s needs. For example, you may want segmentation capabilities and customer satisfaction tracking.
Overall, your POS should integrate with your ecommerce platform and retail stores. That way, customer data and inventory can be synchronized across all channels, and you can provide a seamless shopping experience for your customers.
Type of business
It’s important to consider the specific needs of your business. As a retail store, you’ll want a POS system that consists of, at a minimum:
- Terminal
- Bar code scanner
- Payment processing
- Receipt printer
If you sell at events or pop-up shops, you’ll need a POS device that can travel with you. Tablet and smartphone devices are useful in this case.
You can easily ring up products and send receipts to customers’ emails from one device. As noted, the device will also record sales in your inventory management system, so you can prevent stockouts and generate regular sales reports. Most POS systems also come with integrations that connect to a customer’s ecommerce sales data, which improves customer relationships.
📌 GET STARTED: Ready to start shopping for point-of-sale hardware? Head to the Shopify POS hardware store to shop for hardware designed to help you check out customers at the counter, curbside, and everywhere in between.
Customer priorities
Another consideration when choosing a POS solution is your customers’ preferences. The pandemic has caused customers to evaluate their values and what they want from shopping experiences.
According to a recent Accenture survey, this “reimagined consumer” represents 50% of shoppers. As we said, they’ve changed their values throughout the pandemic. The survey shows that nearly half of the respondents desire new tools and improved shopping experiences.
When choosing your POS devices, consider what your customers value.
- Do they shop eco-friendly? You may not need a receipt printer, as these customers prefer emailed receipts.
- Do they prefer to use contactless payment options? You’ll want to pick up a Tap & Chip card reader.
- Do they value loyalty programs? Your POS should let them easily sign up for and use reward points.
Having the right POS device can help you show customers how your business values align with theirs. It can also increase customer loyalty and enhance the shopping experience.
Built-in payment processing
Payment processing is an important feature to look for in a POS system. Basically, it’s the ability to process transactions without a separate payment gateway or merchant account. You can simplify operations, cut costs, and make checkout easier.
The main benefit of built-in payment processing is simplicity. Everything is integrated into the system, so you go through less steps to process a transaction. You can take card payments, Tap to Pay on iPhone, contactless, and more. The system should also handle refunds and chargebacks smoothly, and help you deal with fraud cases.
Good reporting
With a powerful POS system, you can gain actionable insights into your business operations through comprehensive reporting and analytics. You can use these features to drive growth, optimize operations, and increase profitability.
Some reports your POS system should offer are:
- Sales
- Inventory
- Customer
- Employee
- Profitability and costs
- Real-time sales
Associated costs
Device costs will vary based on your needs, the types of payments you want to accept (like contactless or cash), and the number of stores and employees you have.
Depending on your situation, you may want to buy, lease, or rent POS hardware. In the case of a pop-up store, for example, renting your POS hardware makes more sense than purchasing it.
Current average prices for POS hardware:
- Tablet stand: $149–$185
- Card readers: $39–$49
- Bar code scanners: $229–$329
- Cash drawers: $139–$159
- Receipt printers: $299–$369
- Shipping scale: $59–$89
Check out every POS provider’s options and consider what you’ll need to run your store.
Learn more: How Much Does a POS System Cost?
Training staff
The right POS devices work to provide a satisfying experience for customers in-store. However, a positive experience also depends on how well you train staff. The more time you invest in training employees on your POS devices, the better interactions they can provide customers.
Some training tactics include:
- Train staff on the new POS system directly. Help employees learn by doing. Provide instant feedback on what to improve on, and provide additional support with video tutorials and resources.
- Process real transactions. Give employees the opportunity to practice skills in a real-world setting. It will help them remember the proper procedures and improve their confidence when dealing with customers.
- Get employee feedback. Ask staff to share their experiences on different POS devices. It will make them feel heard and foster better communication between them and managers. You can also use feedback to improve POS training.
Getting retail employees used to new POS devices takes time. But with a little preparation and attention to detail, you can train staff effectively and earn more sales for your store.
Learn more: 5 Tips for Training Your Employees on a New POS
Find the right retail POS system for your store
POS devices are essential to any retail or hospitality business, as they allow businesses to quickly and efficiently inventory, manage customer data, and process sales transactions. With the POS hardware described above, you can create a system that improves customer experience and increases sales for your retail business.
Read more
- How to Serve Multiple Customers Effectively with Saved Carts
- Merchant Services: Everything Retailers Need To Know
- What Is Near Field Communication? How to Use It and Why It’s Important
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- What is a Shop Till? (+ How to Use One in Your Retail Store)
- Card on File Transactions: How to Process Subscriptions & Recurring Payments on Autopilot
- What is a Chip and PIN Machine and How Does it Work?
- What Is a Third-Party Payment Processor and How Does It Work?
- EMV Chip Cards are Coming to the U.S. (Here's What Merchants Need to Know)
POS device FAQ
What are 5 types of POS systems?
- Cloud-Based POS System
- Mobile POS System
- Self-Service POS Systems
- Integrated POS Systems
- Kiosk POS System
What is a POS device used for?
What are the characteristics of a typical POS device?
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