POS systems and point of sale terminals comparison

Modern POS: cash register, table reservations and loyalty programs

Today's POS systems and mobile terminals originated from the classic cash register, which was developed in 1879 by James Ritty. In the past, the focus was on avoiding theft by your own staff by integrating the cash drawer, while modern POS systems cover a wide range of functions. Transactions through cashless payment methods such as debit cards and credit cards (Visa, MasterCard and American Express) is a core functionality, supplemented by service functions such as table reservations, bonuses or customer loyalty cards. Often a cash register system is also called a POS system. In the past POS has been referred to as a point of sale, in modern cash register systems it is referred to as additional functions of point-of-service systems.

POS systems, mobile terminals and iOS or Android terminals

When selecting a suitable POS system, one must consider the location of the payment process. Where does the payment take place? In retail stores, department stores or in the food trade, there are fixed locations for POS systems, which often require additional systems such as a printer, a second customer screen or a cash drawer etc. In contrast to this, mobile terminals are in use in the catering industry, enabling staff to pay directly at the guest's table. Depending on the purpose, POS systems can also be used with mobile terminals in a network. While mobile terminals in the catering trade are connected to the network operator via the Internet via WLAN or Bluetooth, mobile terminals with a mobile connection are required, for example, in the taxi trade in order to be able to make payment via debit or credit card at each location. Due to the mobility of mobile terminals, it is also possible to safely store them in a vault after work has ended. Meanwhile, in addition to the mobile terminals, iPad, iPhone and Android solutions have established themselves on the market. These terminals are easy to use and can be used with the installation of an individual POS software for various industries.

Online and offline terminals

In addition to the terminals and POS systems, it is crucial to choose the right software and additional services equipped in the chosen systems. Depending on the industry and the need for integration depth into existing systems, POS systems can be expanded to include various functions. Often a connection to an existing ERP system makes sense. However, centrally retrievable data of all mobile terminals and their status to shift sales, cancellations and error messages are also offered.

In addition to the expandability of POS systems to additional services, online and offline terminals are offered. In offline POS systems, all data is stored in its own system landscape, whereas online systems store the data locally in the cloud. This results in some advantages and disadvantages.

Advantages and disadvantages of online POS systems

+ always latest software version – updates are automatically installed, without technician
+ Data backup done by providers in the cloud
+ Hardware break-in and destruction will not result in data loss
+ Online documentation / Guidance available at any time, sometimes directly on the cash register system

- No or limited usability in case of internet connection failure
- Solutions based on iOS are very expensive due to the hardware costs
- Business data is in the external cloud
- To connect to the Internet, a good WiFi coverage must be available
- High risk of attacks by hackers, Trojans, viruses

Advantages and disadvantages of offline POS systems

+ No costs for the connection to the Internet (WiFi hardware + monthly costs for the Internet service provider)
+ Business data are local only
+ No security risk by connecting to the Internet
+ Large range of low-cost POS systems running on standard Windows systems, some with touch screen and a large supply of additional hardware

- Software and hardware updates must be done by yourself or through a service technician.
- High internal and / or external effort during the installation of POS systems
- Data backup must be carried out regularly
- Expensive service costs through external service providers

Debit and credit cards at point of sale terminals

If you offer only cashless payment methods via the POS system, the acceptance of debit and credit cards (Maestro, VPAY, Visa, MasterCard, American Express, etc) should be available. You must be aware that you have to pay different transaction fees on your sales. Generally, the transaction fee for debit cards is at least two times cheaper than for credit cards. American Express has the highest transaction fee. Therefore, some merchants do not use American Express if their customer group does not require the payment method. Merchants should have a clear idea of the payment preferences of their customers.

The costs of cashless transactions

As a guide, you will find below average costs for cashless transactions at POS systems. Depending on the provider and network operator, the prices for transactions may vary.

Debit cards (Girocard, VPAY and Maestro): ca. 0,95 % per transaction
Visa & MasterCard: ca. 2,5 bis 2,75% per transaction
American Express: ca. 2,75% per transaction

To support cash payments, you can also extend your POS system with a cash drawer.

Buy or rent POS systems

You can buy or rent the cash register systems and related software. Both the purchase and the rent have advantages and disadvantages. It is not possible to make a clear general recommendation. Depending on the business model, the industry or the duration of use, both options offer advantages.

The purchase of hardware and software can, depending on the number of POS systems, quickly amount to several thousand euros. Remember, however, that you own the terminal and thus control all access to software and data.

When renting, you must pay special attention to how you get access to your data after termination. Notice periods must also be considered. Rental models make sense because of the low investment, especially for small businesses or short-term use of mobile terminals. For example, seasonal licenses for beach clubs, beer gardens and ski lodges, monthly licenses for the Oktoberfest, fairs and spring festivals, weekly licenses for city festivals and festivals or daily licenses for corporate events, New Year's Eve, birthdays or weddings are offered.

PCI DSS and POS security

Depending on your distribution channels, industry, and number of transactions, you must comply to the Payment Cards Industry Data Security Standard (PCI DSS ) . Companies' compliance is controlled regularly.