We learn how shopping works at such a young age it seems intuitive: when you’re ready to purchase something, you stand in an orderly line until it’s your turn to be checked out. But what happens when a brick-and-mortar store changes that process?
According to a recent study from IHL Group (as reported in Forbes
), a significant slice of retailers plan to do just that: 28% intend to adopt mobile point-of-sale (POS) by the end of this year. Is mobile POS the future in the retail industry? Let’s break it down.
A traditional point-of-sale system is comprised of many separate, relatively expensive, parts. According to Retail Systems
, a single-user software license will run you anywhere from $1,200 to $2,500. A single POS terminal will cost anywhere from $3,000 to $4,000, and the scanner, cash drawer and printer will cost upwards of $900 total. Add an extended warranty to that for around $200 a year, and in total, just one POS system alone costs $5,300, and that’s on the low end.
Now, consider the POS system at my local coffee shop in Portland, which is comprised of an iPad® mobile digital device (ranging from $400 to $600) with a Square card reader
($275/month) attached to the top. Once my purchase amount pops up on the screen, I choose what percent tip I’d like to add (which has already been calculated for me), swipe my card, request an emailed receipt if desired, and then I’m done. That’s it.
Systems like this are inexpensive for the business, and convenient for the consumer. Consequently, they’re becoming more common, with small businesses leading the charge (along with leaders like Apple and Best Buy stores). Think of all the possibilities (a few of which you’ve probably already experienced firsthand): food trucks using a mobile device to take orders or check people out, a restaurant bringing a tablet to the table to settle a bill, or maybe even a boutique clothing store ordering a customer out-of-stock merchandise on a mobile device.
The most compelling argument for
a future with mobile POS in retail is simple: they enhance the customer experience while keeping costs down for the business. Customers check out quicker, so they don’t have to wait as long, tipping and receipts are streamlined, and security is tighter; you never have to give your credit/debit card to someone else.
While small businesses can adapt to mobile POS systems with relative ease, it’s more difficult for mid-size or large corporations to jump on the bandwagon. Traditional POS systems are complex, and customers are familiar with them. Changing a process that’s so deeply rooted in your customer base is not an easy thing to do, and the expense of implementing new software and training for employees is not insignificant. However, one large corporation recently attempted to do just that.
Just this year, JCPenney replaced all of their traditional POS cash wraps with mobile POS devices and self-pay kiosks. The results were decidedly mixed. While the mobile POS devices did a great job of “line busting,” i.e. speeding up checkout lines, many customers didn’t know where to check out in the first place.
That confusion stemmed from lack of clear designation. JCPenney employees are encouraged to dress in fashions that their customers would wear, so they didn’t noticeably stand out when customers looked around for a sales associate. Naturally, the corporation is taking steps to fix the problem by outfitting associates with red lanyards and mobile carts
The most compelling argument against
a future with mobile POS in retail is that it’s difficult and sometimes, risky to alter a long-established and long-embraced model of purchasing. There haven’t been societal norms established for mobile POS yet, and corporations are right to be concerned about the cost of switching to a new system.
While it’s no question that technology will continue to change our way of life, sometimes it takes a while for new systems– no matter how beneficial or innovative– to catch on.
What has been your experience with mobile point-of-sale systems? Do you think it’s the future?