How Much Money Can a POS System Save You?

By Bob Phibbs

 

How Much Money Can a POS System Save You?

"Can you explain how much money a POS system can save you per year, when just a small, medium-sized store can inventory track manually fairly easy? I'm trying to justify the huge expensive equipment, but also I have to hire someone to physically train and set it up as we're just staffed to handle the current workload. Plus, I bet whatever I buy today will be outdated in three to five years. So I have to know I'll save way more money than the expense in three to five years."

A: You're not going to like this answer. If you could take all of the markdowns you had to do off by how much you paid, including your freight and dating, and how long it waited there, you could add that up. If you could look at the direct correlation between your marketing and what went out the door, you could look that up.

However, you don't have that information. So saying you're going to somehow, magically know how much it's going to save you. Look, the reality is, you know, a long time ago, “I said I'm going to pay a whole lot more for my website than I'm ever going to listen to conventional wisdom.” I have redone my website probably three times. Probably as much as you would pay for a car or maybe more than a car. And you know why? Because that's my image.

Am I sitting here saying, "Well, how is that going to play out?" Yes, I get it. You could nickel and dime yourself to death and then say, "Oh, it doesn't make sense." Or you could understand that knowledge is power. Why do so many small businesses stay small? Because they don't understand data. Data is everything. The more I know about my customer, the more I know what they click on, the more I understand what the correlation between what I put on sale and what I don’t. The more I understand where that premium love is then, the more I can do better with it. But without it, you are flying blind.

You are telling yourself “I don't need it.” Meanwhile, you probably have half your inventory out of date, that should have had a price change, or didn't update automatically because you didn't have an update POS system. Modern POS systems update themselves regularly in iCloud or something like that. I encourage you to check out my post, something like, “48 things to know about buying a POS system.” 

And again, my goal is not to be your best buddy here. My goal is to tell you the things that you're not telling each other. I've gone to association meetings where the keynote is someone talking about how we just have to have a positive mind. Or I have somebody else who would say, "Oh, retail is dying. Why do those people get airtime?" It's hard work being a retailer. It always has been. If you want to succeed, you're going to have to drop everything. That means you're going to work late. You're going to work harder than you ever thought you were going to have to. Just because you open the door doesn't mean you suddenly get to reap the benefits.

See also, 48 MUST Ask Questions To Help You Select The Best Point Of Sale POS Retail Software

But you know what? On the other side, if you are in for retail, it's an awesome place to play. And I encourage you. I'm going to put in here the link to my podcast. Don’t listen to this other stuff of, "Well, I tried a POS system one time and you know it costs me so much money." At the end of the day, we're about as successful we make our mind up to be.

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