You may think that when you buy a new POS system, the cost you’re paying is the only cost. This is rarely the case. This article presents some common hidden costs of new POS systems.
Caller ID Functionality
This feature can be very useful for establishments in the hospitality industry, where taking clients’ calls is very important, as is knowing who’s calling. Going beyond that, your POS will open the customer record and identify your caller. The point is that you spend less time typing and clicking while trying to talk to the customer and don’t have to put them on hold as you search through records.
Almost all computers come with an integrated modem, and the caller ID info on the computer is collecting using that. The issue most people have with caller ID is that it’s hard to program this to work with virtually all “regular” PC modems, so many developers program a solution for only one brand or type of modems. Then, you have to find this exact type of modem.
This isn’t even the worst option. It’s hard to even program the feature to work for one specific type of modem for some software developers, so some of them copy the programs in a third party company. In exchange, this company gets a product that works for one single type of modem, which only they sell. These modems, being unique, can be quite expensive – around one or two hundred instead of 10 or 20, which is how much a regular modem costs.
Expensive and Unappealing Modems
What’s more, these modems are very bulky and not particularly appealing in an aesthetic sense. You can get an idea of this if you type “POS caller ID” in Google images. If caller ID is important to you, look for POS software that integrates with all standard / built-in PC modems.
You’re probably using text messages a great deal if your chosen POS software has this function. Especially to owners of establishments like diners and salons, these can be really helpful. You can remind them about appointments at your salon or inform them there’s a special on at your diner that night. You can send info about promotions.
SMS marketing is big, there’s no denying that. If your POS software has an SMS service feature that simply integrates to another company’s SMS service, you may be paying hidden costs? Why? Because that would mean the developers are using another company’s service instead of programming their own device to send text messages. You will be paying for every single SMS your POS software will ever send.
It’s likely that the developer of the POS software is getting a commission fee off of every SMS you send from the third party company you got stuck with. It’s best to choose POS developers who make their own SMS features independently of third party companies. They use your email to send the SMS messages at no charge to you. This way, you don’t pay for any SMS messages that your company sends through your POS software.
Credit Card Processing
This is the last of the main sources of hidden costs. It’s clear that banks and other financial institutions provide credit card processing on a POS system. This is a service that costs money. Every type of processing has to be paid for: debit card processing, credit card processing, check processing, gift card processing, and more.
There’s no such thing as free payment processing. To swipe a credit card is a credit service. It’s possible thanks to the efforts of multiple banking institutions (card issuer bank, banking institution of the merchant and the processor bank or entity for the payment to be processed). A lot of technology is involved in making these transactions possible.
Security concerns and risks exist, and credit card fraud is all too frequent. Banks pay money for security systems. That said, we have a lot of competition in this field. It’s best for your business to choose POS software that offers you a selection of more than one processor in order to find your best deal.
Which software is best?
There’s really no single BEST POS software or processor. No company offers the best rates for every type of business. Some are best for salons, others for bars, still others for restaurants. All of these have different rates. A car dealership will have different rates compared to a consignment store. Everything depends on the industry that you are in.
This defines what kind of rates you get for credit card processing. Moreover, the offers will take into account the statistics of fraud and sales volume in your industry. What can we say in sum? Look for POS software that offers multiple credit card processors. You need to have as many choices as possible to find the best deal for your business. If you don’t make the effort to look around, you might be stuck with a default processor with high fees.
Hidden Costs of Switching to a New System
The elements below should be taken into account. They can have a major impact on your bottom line over time.
Being able to collect data on customers, their purchasing patterns, and their preferences and interests puts a business at a strong advantage compared to those that do not collect this data. Relationships with your customers and the ability to create targeted marketing campaigns are critical. Your business could suffer without these insights. Inquire into the new system’s capabilities before making a commitment.
Viruses, hackers, and data breaches are serious issues that can have a very adverse impact on a business. No company will benefit from being in the news for allowing customers’ credit card details to be stolen or exposed to fraud. POS systems have often been designated as a weak link for security in a business. Opting for a safe POS is critical if you want to gain customers’ trust and avoid unwanted negative publicity.