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I recently wrote about why businesses should be accepting card payments from customers, in which I suggested businesses should see past the cost of card processing and consider the benefits. This month I want retailers to consider the same idea when it comes to point of sale technology.
When working with my retail clients and prospects it does still surprise me how many either do not have an EPoS system or they do but don’t use the information provided to make their business more profitable. Investing money into a good EPoS system can improve profitability, I have set out below six ways in which using a EPoS system can boost the bottom line profits.
1. Gross margin reports
When correctly used a good EPoS system will provide your business with detailed gross margin reports so you can see how you are performing against your target margin. If you are not achieving this then you can review the sales to see where the damage is being done, it maybe you have wrongly calculated a price. With an EPoS system this can be corrected straight away, not at your year end accounts meeting with your accountant some months later.
2. Staff management
It is important that you maximise your customer spend, with an EPoS system you can set your staff sales targets both in terms of total value and average spend. Whilst figures can vary on a day to day basis, over a few weeks and months you will be able to identify staff members that are upselling to customers better than others. You will be able to take this information and ask sales champions to share their techniques to other members of staff to increase profitability.
3. Loyalty scheme
A good way to increase your profits is to increase your sales. An EPoS system should allow you to set up a loyalty account for customers so that you can reward them for their loyalty with money off future visits, therefore encouraging them to return. This can be in the way of a 1% cashback on spend or, for example in a coffee shop offers such as buy six cappuccinos and get one free.
Another great way to boost sales is to use promotions to encourage impulse purchases. When listing your sales lines on your EPoS system you can add bundle sales so you can combine two or three products to offer a special price or offer BOGOF deals. The EPoS system will do the pricing at a touch of a button. You can easily control the date periods you want your offers to last.
5. Processing speed
Queues can lead to lost sales and therefore lost profits. As all the pricing information is held on the EPoS system staff members will be able to spend less time looking for prices or checking stock and simply to scan an item or touch one of the pre determined quick buttons on your till system. This should allow faster serving and therefore reduce the chance of lost customers.
6. Stock system
If you hold stock then using an EPoS system will lead to greater profitability as you will be able to view reports and manage slow moving stock. You will be able to improve cash flow by avoiding over stocking, increase sales by using automatic stock re-ordering and reduce the amount of lost sales when running out of stock.
EPoS systems can be either stand alone hardware or cloud based, they both have their advantages and as a Platinum Xero partner, Armstrong Watson are increasingly looking for Cloud based solutions to help our clients. If you are looking for an EPoS system that can avoid large amounts of the upfront costs that a stand alone system may have I’d recommend retailers take a look at www.vendhq.com; a Cloud EPoS system that integrates directly to Xero.
If you would like to know more information on how an EPoS system could benefit your business, a Vend demonstration or more info on Xero then please do get in touch.
Grant Smith, Partner
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