What Is a POS System and How Does It Work?

What Is a POS System and How Does It Work?

A point of sales system is a business tool that combines retail hardware, software and peripherals such as receipt printers to create an electronic cash register for your store. Understanding how they work can help you make the most of them at your business.

A POS system collects data from all store transactions and updates inventory which streamlines the process of running your business.

POS stands for point of sale, and the system is so named because its main function is to record and process all transactions taking place at a business location. This includes inventory and customer data as well as sales and payments. A POS system uses a form of software known as an operating system to perform these functions. This is usually combined with a hardware system which often uses a touch screen as the primary interface, but they can also be equipped with regular computer monitors.

A POS system is made up of three components: the hardware, the operating system and the software. All work together to gather data about customers and transactions as well as manage inventory levels and keep records on sales transactions.

The Hardware

POS system hardware comes in two pieces, the computer and the touch screen. The computer is where all the data processing takes place, while the touch screen serves as an interface. Most systems can be equipped with multiple screens to display information to several people at once or to create a wall that separates employees from customers.

When shopping for a POS system, it’s important to look at the touch screen first. You want one that has a high resolution and can display clear images. The computer should have fast processing speeds so transactions go through quickly and customer data is stored accurately.

The Operating System

POS systems use an operating system similar to those found in desktop computers. You can choose from popular operating systems like Windows or Mac, but some systems choose to use an open source system like Linux which has the benefit of being less expensive than other options. The POS software is installed on the computer and transfers information to the touch screen via a USB connection.

The Software

POS systems come with specialized software (apps) that are designed to take in information from your hardware and create reports based on the data. These are usually used for inventory management, but you can also use them when creating sales transactions or processing customer payments. You can choose between point of sale software packages or POS system applications, depending on how much control over the system you want to have.