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Justifying Point of Sale for your Business
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).
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