Is Your Point of Sale Costing You Sales?

Boris Byers

I am fortunate to live in a Southern California beach town. I have surfed most of my life because of my close proximity to the ocean. Unlike how it is portrayed in the movies, California beaches get cold in the winter, requiring surfers to wear wetsuits this time of the year. I needed a new wetsuit this year and my shopping experience at the local surf shops left much to be desired because of their point-of-sale systems. They have the technology to provide outstanding customer service, so why aren't they using it?

The town I grew up in has a small main street with over ten surf shops selling the same merchandise. This makes it very convenient for me to run down during my lunch hour and grab whatever I may need very quickly. On this occasion I needed a specific size of wetsuit so I made a few phone calls to make sure they had my size. I found two stores right across the street from one another that had my size. The first store couldn't tell me the color of the wetsuit. The other store told me they had one in black after they put me on hold and physically checked for southernmost point buoy landmark. When I asked each of them if their other store locations had any in stock, rather than looking up stock balances on their point-of-sale systems, they gave me the phone numbers to the other stores and told me to call myself.

Feeling confident, I headed down during my lunch hour to buy my new wetsuit. When I walked into the first store, they had my size, as they told me they did on the phone, but the only color they had was red! Their point-of-sale software couldn't give them that important information and so they couldn't relay it to me. I shot the sales person an unhappy look, and he simply said, "I know". So I left that store with my $400.00 and walked across the street to the second store that had my size and in the standard black color that I wanted.

I found the wetsuit in the second store right away. The time limit on my parking meter and lunch hour were expiring so I was in a hurry. I took the wetsuit to the first counter and the clerk told me the system was down; and then asked if I could move to another checkout counter. At the next one, the girl said the receipt printer was out of paper and she didn't know how to replace it. At the third counter, the clerk could ring me up but only if I were paying cash because they were trying to fix a credit card machine batch error. Each of their checkout counters are in different places throughout the store, so at that point I was done. They also lost a $400.00 purchase due to their point-of-sale system.

Walking back to my car, I decided to quickly check a smaller store on the same street. Rather than searching myself, I simply walked up to the counter and asked them if they had the black wetsuit I wanted in my size. The clerk looked it up on the screen and then brought it back to me while I never left the counter. That's service! Their point-of-sale system was quick and efficient. Since I'm in the point-of-sale industry, I also noticed that they had up-to-date hardware, software, and credit card processing. The efficiency of their point-of-sale system made it easy for me to buy and earned them the $400.00 sale.

Driving back to the office, I wondered how many times sales simply walk out of stores because of their point-of-sale systems. The products most retailers sell aren't unique so the emphasis should be on customer service and making it easy for a customer to buy. Otherwise, a customer can simply walk to another retailer and buy the same item. Follow these tips to insure your point-of-sale system isn't costing you sales.

Training - Training your front line employees on the proper use of the point-of-sale system should be a top priority. This training should include all aspects of the system that allow them to serve the customer more efficiently. Most clerks seem to know just the basics, and any anomaly forces them to stop production (sales) and wait for help. Just think about how many times you've been in a line and are forced to wait while a customer pulls out a coupon, is exchanging merchandise, or is trying to buy an item without a barcode. And these are just the basics.

Cashier training should also include advanced functions such as checking stock levels for in-store customers as well as call-in customers, checking stock levels at other stores, initiating a store transfer, searching for merchandise in the system, ringing items with missing bar code tags, and any simple hardware malfunctions that may occur (these would include changing receipt paper, rebooting a computer, and so on).

Accurate Inventory - The accuracy of the point-of-sale information is only reliable when the users are reliable and disciplined. Unreliable information is an indication of an undisciplined user. How many times have you heard store employees say "the system shows we have one, but I'd call first to verify."? Or worse, a store tells you the system confirms they have several, and you make the trip, only to find they have none.

To insure accurate and reliable on-hand inventory levels within the point-of-sale software, the user must:

1. Perform a regular physical inventory. These should be performed quarterly as part of the auditing process when preparing quarterly financial statements.

2. Cycle Counts - If a quarterly inventory process is too much of a challenge, perform cycle counts within the best selling departments or vendors lines.

3. Do not allow employees to sell goods classified with a miscellaneous SKU (Stock Keeping Unit). Inventory levels will never be adjusted properly.

4. Scan the bar code of every item sold. Entering an item number manually into the system will never account for size and color based items. An item UPC (Universal Product Code) bar code is different for each size and color.

5. Insure the store locations are communicating with each other flawlessly. Whether your system is a real-time configuration or a polling configuration; proper communications will either make or break the reliability of the point-of-sale information. Sales, returns, receiving, adjustments, and transfers all affect stock levels. A store location can never know if an item is in inventory or has sold out unless it is communicated to them.

Modern Hardware - You should pay attention to the aesthetics of the point-of-sale hardware just as you would to any other store fixture. You will interact with customers more at the cash wrap than any other area in the store; so make sure to make it a pleasant experience.

Most name brand hardware today is a bargain compared to a few years ago. It also gives your store an updated appearance. Although it will cost slightly more than "cheap" hardware, it will more than pay for itself with the reliability it offers. Modern hardware also requires less real-estate at the cash wrap; touch screens and flat screens don't require a mouse and take up less space. An all-in-one type of unit offers all of the components, including the computer, built into the monitor.

The best part of name brand point-of-sale hardware is that it works reliably. POS hardware companies have industrialized their computers and peripherals to meet the rigorous demands of the retail environment. These types of computers and printers will cost more, but their duty cycles vastly outperform any comparable consumer level device. Consumer level computers are not designed to operate non-stop for 12-24 hours per day.

Integrated Credit Card Processing - Save yourself and your customers the frustration of those little grey boxes. Anytime you can minimize devices or suppliers, your quality will always improve. Most point-of-sale systems today offer a credit card processing feature within the application. Using the software versus dedicated hardware allows you to speed transaction times, reduce costs for paper and dedicated phone lines, decrease training confusion, reduce theft, and free up valuable counter space. It's a winner on all levels.

Easy To Load Receipt Printers - The days of 2-ply and 3-ply receipt paper are long gone. Most point-of-sale software today allows you to recall a receipt onto the screen for reprints. If your software has this feature, dump the slow dot-matrix printer and get one of the faster thermal printers on the market today. In addition to being fast and quiet, they also offer lower paper costs and can be loaded with the press of a button. When the paper runs out, cashiers simply press the open button and drop in a new roll. Anyone can learn this within seconds, and they will no longer have to wait for a manager to perform the old task of threading multi-part paper through the maze of spools.

Having a point-of-sale system and using it strategically are two very different things. Rather than using the point-of-sale system as a glorified cash register; use it to provide superior customer service. The difference will earn you the sales that are walking out of your competitor's doors.

Boris Byers
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