By Jared Isaacman, Harbortuch
As payment and POS technology continues to evolve ever more rapidly, it is more critical than ever to make sure that your POS equipment is up-to-date. According to the 15th Annual POS/Customer Engagement Survey from Boston Retail Partners, released in early 2014, the lifecycle expectancy of POS hardware is shifting from a more traditional lifespan of eight to 10 years to a much shorter three to four years. If you are still running your business on an outdated POS system, you may be putting your business at risk of a security breach, or at the very least you are not taking advantage of the powerful tools available on newer equipment.
1. Microsoft and XP
A few months ago, Microsoft stopped supporting their Windows XP operating system that many POS systems are running. This discontinued support means that if a hacker finds a new security flaw, exploit or bug in Windows XP that allows them to access your machine, you will be out of luck when it comes to an official patch or fix from Microsoft.
Microsoft typically releases a new security patch on a weekly basis to address recently discovered “holes” in their operating systems. By abandoning XP, they will also be abandoning the patches needed to keep the system safe. The result is that your POS system may put you at risk for a costly data breach.
2. Using Big Data to Improve Customer Satisfaction & Loyalty
The term “big data” has been used in the technology industry for a number of years now. It refers to the increasing quantity of information that is being collected on a constant basis. This mass of data is growing every day and the ability to sift through all that information and find uses for it is important to every business. Generally, this has only been a concern among large corporations, but today it represents opportunities for smaller retail and hospitality businesses as well.
For example, the amount of information available to you today can include everything from the most basic elements of sales, costs and cash flow — to the most granular information on specifically who your customers are, when they come in, what they purchase (and how often they purchase the same items). Simply put, gathering all this information on the preferences of your customers and your potential customers can yield so much data it’s difficult to know how to use it. That’s the bad news about Big Data. The good news is that modern POS systems are equipped with sophisticated software that can sift through all that information and provide you with actionable insights you may never have considered. Having this information at your fingertips empowers you to take actions that will improve customer satisfaction and loyalty.
3. EMV and NFC
You have undoubtably heard of the two most significant changes in the payments industry in the past decade. One, EMV, is a movement by the world’s largest providers — Europay, Mastercard and Visa — to reduce the tremendous number of hacks involved with POS systems and the magnetic stripe cards they accept. The other, NFC or Near Field Communications, involves the ability to pay with your mobile phone. Both of these movements are still in the early stages of adoption, but both need your immediate attention — and the ability of your POS system to accept them.
EMV-enabled credit cards, or “smart cards”, include an embedded microprocessor that provides powerful security features not possible with traditional magnetic stripe cards. The major card brands recently announced that they will be migrating to EMV technology in the near future due to the added security afforded by these cards. To speed this transition, they have announced that beginning in October 2015, merchants who don't accept EMV payments will be non-compliant and will incur increased liability for data breaches and chargebacks. Some POS providers are adding significant charges for EMV card readers. Others are providing them for free. Doing your homework now to “future proof” your business is important.
With near field communication (NFC) technology, customers can simply wave their mobile phone to pay. The number of NFC enabled phones is estimated to reach 1 billion by 2017 and it is estimated that 65% of consumers will use their phones to pay for goods by 2020! This technology is gaining traction as a number of high profile companies such as AT&T, Verizon, T-Mobile and Google are investing heavily in its success. The ability to accept these payments can mean the difference in gaining or losing valuable customers. Again there are POS solutions that offer this equipment for free, so start looking for solutions that include the ability to incorporate this technology so you can take advantage of those sales as they continue to present themselves.
4. The Importance of the Cloud
Traditionally, many POS systems have required a dedicated back-office PC to run reports or make updates to the menu. If your current POS system doesn’t allow you to access and manage all your reports at any time and any place, you’re missing out on technology that can provide you with significance convenience and improved capabilities. Cloud-based solutions not only provide you with greater freedom and convenience, but also protect you from data loss by backing up your data to the cloud.
Here are a few of the features you should look for in a POS system:
• The ability to remotely add, edit or remove menu items/products, screen categories, choices, choice sets and employee information.
• Remote access to real-time sales and labor reports, processing data, and monthly credit/debit card statements. And the ability to set up email subscriptions for each of these reports to automatically receive them on a daily, weekly or monthly basis.
5. Taking These Tablets Can Give You A Headache In The Morning
One of the hottest trends today is the use of tablet based systems. Sleek, futuristic and often extremely inexpensive, tablets are definitely the sexiest new addition to the POS system. For many companies looking to upgrade, they seem the perfect solution. Before you make a purchase, however, consider a number of things that may have a significant influence on your decision.
• In making comparisons, you should make sure you’re not judging the book by its cover. The front-end interface may look sleek and modern, but does it have the necessary features and back-end capabilities that you need?
• Will the tablet stand up under the conditions your staff puts them through? Tablets are typically designed for personal use and may not be “built-for-purpose” to withstand the heavy use often associated with retail environments. It’s also worth keeping in mind that tablets are an attractive target for theft, so you may not want to keep them sitting on your counter.
• What kind of service and support can you expect? Take the time to ask about what you can expect in terms of training and support after the sale. Many tablet POS providers only offer email support and only during normal weekday business hours. You should look for customer service and technical support that will be available by phone or email whenever you need assistance.
These are just five of the most significant reasons to start shopping around. As you can see, some of these reasons could severely limit your business if you don’t, while others could mean you are losing valuable revenue you can hardly afford to pass up. Your competition undoubtedly already realizes all this and, in the end, you don’t want to be the one that’s passed up.
Jared Isaacman is CEO of Harbortuch, a leading national supplier of POS systems and payment processing services.