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Justifying Point of Sale for your Business

Budgeting for, choosing, and implementing your new point of sale

(POS) process is not a trivial exercise. You need a well

conceived and well executed plan. Choosing the wrong POS for

your business can be a business killer. Choosing the right one

can help make your business grow to the next level.

When you make the decision to use POS, you have essentially

decided to change the way you do business. POS is not simply

another piece of hardware and software. Think of POS as a

process, not a system. The POS process effects your transaction

flow, your recordkeeping, your employee management, your

ordering and receiving process, your accounting - in other

words, every facet of your business.

You should approach the decision of when and if to use POS with

the care and due diligence it deserves. How you go about

deciding says a lot about whether POS will work for you. If you

do not have the discipline to undertake a formal decision-making

process, you may not have the discipline that POS requires. POS

requires disciplined business decisions. It imposes formality

onto your business. That's one of its greatest strengths.

Part of the decision to use POS is a financial one. Can I

afford it? Can I afford not to? How long will it take me to get

a return on my investment? These are questions you need answers

to before you make the final decision. Waiting until after you

made your hardware and software purchases may ultimately result

in failure. Step by Step Approach

Successfully inplementing POS in your business requires a plan

which outlines the necessary steps you need to take. Any good

plan should include the following steps.

* Understand your business

* Identify the problem

* Identify the solutions

* Understand the benefits

* Calculate your return on investment

* Choose a POS vendor.

Understand your business

The first step requires you to get a handle on the workings of

your business. You may think you know everything about your

operation already, but if your business is large enough to

benefit from a POS system, you probably don't know as much as

you think you do.

Identify the problem

You might ask yourself "Why am I doing this? Why do I need

POS?" The answer should be this "Because I have a business

problem I'm trying to fix." If you do not have specific problems

in mind then you may be choosing the wrong solution. The POS you

choose may be perfect for a problem you don't have. This step

involves identifying the problem(s) you want to address and

solve with your POS.

Identify the solutions

Once you've identified the problem(s) you're trying to solve,

the next step is to understand how to fix them. Create a Needs

Fulfillment document listing your problems and potential

solutions. List as many potential solutions for each problem

that you can think of. There's usually more than one way to skin

a cat. The more possible solutions you can think of increases

your chances of finding a POS vendor who has a total solution.

Of course, you will need some idea of what's available out there

in the POS marketplace. There are several ways to get this kind

of information. One is to use resources like Google to find POS

suppliers and become familiar with their capabilities. Another

is to hire a POS consultant. Talk to a business aquaintance who

is already using POS. The Small Business Depot's downloadable

eBook POS for Beginners is also a good place to start.

(http://www.barsnstripes.com).

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Understand the benefits

In order to calculate your return on investment you need to

compare the cost of doing business the way you do it now with

the cost of doing business with a POS solution in place. We've

identified three classifications of benefits derived from POS:

Cost benefits, Revenue benefits, and other (intangable

benefits).

Calculate your return on investment

The first step in calculating your ROI is to calculate the

impact a POS will have on your costs. For example, POS can help

reduce your business expenses. Now it is time to quantify those

savings. Now that you've calculated your cost savings and

revenue gains, you can estimate your return on investment. Your

return on investment is simply your cost savings plus your

revenue gains minus your cost of POS.

ROI = Net cost savings + net revenue gains - POS cost

Of course this is just an estimate. The influence of POS on

your business will depend on these and a lot of other factors.

But if you do your homework and choose your POS vendor wisely

there is a very good possibility that your POS will provide a

handsome return on your investment.

Choose a POS vendor.

Once you've determined that POS is justified, and you have

determined what problems you need fixing, only then should you

go about the task of selecting a vendor and acquiring POS

products.

About the author:

Mike Tyler is a technology specialist with over 35 years

experience. He currently operates a website hosting and

development business at http://www.homepagekeeper.com and a

technology consulting site at http://www.smallbizdepot.com