What Is a Point of Sale System?

The importance of doing business is to make money, but of more importance in business is the means to receive payment for goods and services transacted. With advancement in business technology that makes the business transaction a borderless affair in today’s global economy, there is a need for a way to send and receive payment for business transactions. One of the tools to make and receive payment in the modern business transaction is the POS system.

What is POS system?

A POS is a point of sales transaction where the sales exchange is concluded with payment. It could be a place or an electronic device to send and receive payment for business sales. The thinking is that POS is an electronic payment device that facilitates the exchange of money for goods or services, but it’s not necessarily a device; it could be a place as in building where people are to facilitate the business transaction by receiving payment for goods and services. However, the familiar scene of the point of sale system today is the electronic POS that you find at different sales outlets you go including online business transactions.

Think of a POS as a system where monetary exchange takes place for goods and services.

Electronic point of sale system

In modern terms, a Point of sale system is a device with software and hardware that facilitate secure payment transaction between two ends. One end being the point of origination that is the on-premise end and the cloud-based end that is the remote end where the POS solutions resides that support the transaction.

On-premise POS

The on-premise POS has a backend that monitors and provides sales conclusion services to the entire system. The on-premise POS is the merchant point where the business activity is taking place. After the customer has concluded sales transaction with the merchant, they want to make payment for the goods or service being the article of the transaction; the POS is therefore used to collect the sales amount owed by the customer.

After payment is made, the back end will enter the amount into the merchant’s account and issue a receipt or invoice to cover the transaction just like a cash register in a physical store would want to issue a receipt for payment received.

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On-premise POS System features

Electronic point of sale system features both hardware and software. The device includes the physical gadgets installed to facilitate cash collection, receipt/invoice printing, scanners to scan documents and images, a display screen to view ongoing transactions and other facilities according to the sophistication of the POS system.

Cloud/remote end of a POS

The crucial part of any financial transaction is security. The backend of the POS is a system much larger than the on-premise end as it is usually “Software as a Service” provided by a third-party POS provider to serve multiple of merchants to facilitate business transactions on their behalf.

To access the cloud end of the POS requires the use of the internet. The system is configured in a way to take account of all transactions even if the web fails at it may happen in some cases.

The point of sale system, who is it for?

Modern business transactions call for new ideas about how to deal with the customer-seller relationship in exchange of goods and services. Therefore, anyone in business who wants to facilitate smooth business transaction requires a POS. in most cities and even in remote local areas, POS offers better business deal between buyers and sellers.

Advantage of POS system

You don’t have to carry cash to buy whatever you need where POS is available. Increasingly, the credit based economy demands a better deal in money handling where most buyers have to go around with electronic money that can be accepted electronically.

POS brings trust and helps both the merchant and customers to transaction freely without cause to worry about payment. It also offers safety of financial dealing as every aspect of the financial transaction is documented and traceable.

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