Time for an Upgrade?
How a point-of-sale system can help you become a marketing machine
Written by Andrew Hind
For many small and medium-sized garden centres, buying a point-of-sale (POS) system may seem like an unnecessary expense. The business has been running fine without one for years, so why change now?
“Business software is the difference for survival for small and medium businesses,” explains Kevin Schilter, director of sales and marketing for Windward Software Inc., a company that has specialized in designing POS systems for garden centres for 25 years. “In today’s age, no centre can afford not to have one.”
Many uninformed people look at a POS system and believe it’s little more than a sexy, computerized cash register. In truth, it’s a lot more.
Yes, at its heart, a POS system is a cash register. But because it’s based on a computer, it opens up a whole new world of data about your business, data that otherwise you would never have. All information from each and every sale is stored on a secured server, and remains accessible forever.
“This information is worth time and a great deal of money,” explains Schilter. “The majority of garden centres that haven’t transitioned to POS systems are small-sized, family-run operations that are still running on cash registers and where the whole business is in the owners’ head. A big part of the investment in a POS system is to increase the business’ value or to pass the information vital to running the business on to the next generation. Simply put, a business with a POS system is far more valuable than one without.”
It’s also a potentially far more profitable business. The day-to-day benefits of a POS system, both in terms of saving money and increasing revenue, are immense.
The main advantage of a POS system over a cash box or a cash register is the sophisticated and detailed sales reports it provides. Thousands of sales transactions are entered daily into a POS system in even a mid-sized garden centre business, and each of these transactions represents a unit of information that tells you a lot about the product, the customer, the store, and even the salesperson. The software in the computer allows you to break down this information in several ways, such as by SKU (item sold), time periods, promotions, and so forth.
“The software in the computer lets you analyze sales information in a number of different ways with two main benefits: customer management and inventory management,” says Santo Ligotti, director of channel marketing and communications for Moneris Solutions, a Canadian supplier of POS terminals. “In terms of customer management, it allows you to track a person’s purchases, record important dates, implement a loyalty program. It also allows for easier and more accurate inventory management, flagging items for re-order and analyzing sales patterns. In both cases, the information gained allows you to react accordingly in a timely fashion.”
In addition, POS systems are faster than cash registers, since scanning a code is certainly easier than punching in numbers from a sticker. This means you can save money on staff expenses, since transactions can be processed much faster. POS systems are also more accurate than cash registers, so there is less of a hassle when it comes to cash drawer reconciliation.
Now that we’ve got your interest, down to business. What can you expect to pay for a POS system? What should you look for? How difficult is installation and getting up to speed?
Expect to pay anywhere from $3,000 to $6,000 per station, including software, scanners, printers, installation, training, and support, plus costs for integrating into your back-end system. It sounds like a large investment, but it’s just that: an investment, and one with considerable returns.
A good POS system needs to be fast and easy. Fast because garden centres have two or three peak periods when they make the vast majority of their sales, so getting customers through cash quickly is vital. They also need to be easy to operate, because most employees are seasonal so there is little time for extensive training.
“We offer a standalone module which means, in the event that the server goes down, you can continue to operate and information will be stored within the register’s hard drive for later retrieval. That’s a safety feature to consider,” says Schilter. “Email marketing based on prior purchases is a new segment that that represents an exciting tool. Let’s say you buy tomatoes. When you get home, you’ll find planting instructions in your email. A month later, there will be an email reminding you to buy cages to support them. Next, there will be an email about what to use to deter insects and disease. Later, there will be an email about cooking and preserving. This allows a garden centre to touch a customer five or six times to win them back in the door.”
Take your time to investigate your options; there is a wide range of software tools available that can be linked to POS systems to improve your business.
But they’re computers, so unless you’re a techie installation can be a hassle, right? Nope. The experts say that if you can install and operate a home computer – something most ten year olds can do nowadays – you can quickly get your POS system up and running. And then, a whole new world of business management opens up to you.
“POS systems are so important because they allow your business to grow,” says Ligotti. “The added and more immediate flow of detailed information about your sales will allow you to react according and become more competitive.”