Point-of-Sale Pain Points & How To Work Through Them | B2B Vault | Episode 145

Yo, what's up everybody? It's Justin live from B2B Vault, the payment technology podcast sponsored by Nationwide Payment Systems, hosted by this guy, Allen Kopelman, and we'll be providing you educational information about business fintech, payment processing, and the technology businesses are using in the world today. And in today's podcast, we'll be talking about the point-of-sale technology and a few pain points that small businesses deal with on a regular. Being in the business, we get phone calls constantly about the terminals not working, we can't batch out, can't add tips, blah, blah, blah. There's just never-ending stories about things that are going on. Warm in here today, my glasses are fogging up. And yeah, so Allen thought it'd be a good topic to discuss a few of these pain points on the podcast. And so here we go.

So here's what we're going to talk about today is, you know, what are the pain points, you know, budgeting. So we'll talk about that, you know, technical expertise, then we're going to cover scalability. And features, and the, the, and then we're going to talk about reporting and how, and how all that works. You know, when you're taking, you know, merchants have, you know, basic options when it comes to accepting payments. You know, you can get a credit card terminal, a smart terminal which does a little bit more where you can text, email receipts and things like that, um a cash register and just take cash, right? No credit cards. You can get a little thing for your phone, right? And then you use your phone and a little dongle to take payments if you're an on-the-go business. You get a full-blown point of sale system, which is getting popular with merchants, you know, so they can track inventory and things like that. Yes, sir. And then how do they make a choice? How does a business decide? And basically it comes down to The number one, it comes down to the budget. You need to make— businesses do not budget enough for technology, and they need to budget for technology because technology is the great equalizer. And even Justin sent me an email about— was it 67% of people bought online and then picked up either curbside? Oh yeah, store.

That was really interesting.

So that just goes to show you that how customers' buying habits has changed, right?

Because I mean, people want to pick up their packages because why want to wait for it? That, and also people are stealing. Theft is crazy, right?

Yeah, porch pirating.

Yeah, I mean, it's constantly happening. And so I didn't myself— well, the stuff that my— that I was buying, I couldn't necessarily go and pick up, you know. I was like, whatever.

No, but I'm just saying, it's a great option. It's a great option for businesses. And then when people look at a system, they look for things like, do they have experience maybe at a job where they use that, or a friend used it, or somebody at their business has experience with that system, right? And the ease of use. So let's talk about the budget. Some business owners have a limited budget and they need to look at, you know, their budget. And the other thing, you know, which happens when we talk to business owners is You know, they have like— they call it, you know, champagne dreams and a beer budget.

Yes.

You know, you need to, you need to look at it and you need to say like, hey, maybe I need to spend $300, $400 a month, whatever, you know, whatever the number is, right? Because, you know, unless you have one station, then that's different. But I'm just saying you need to spend some money to get the features that you want that's going to also help you get more more business, help you get people to spend more money in your business, and get your average sale up, right? You know, and so that's what technology is for. You can't just look at it like, oh, I'm spending money so I can process credit cards. That's not what it's for.

Well, also technology— there's ways to utilize technology to lower your overhead and cost, right?

Well, that's what I'm saying. It's gonna, it's gonna lower your overhead once you implement everything.

Right, right.

So you have to look at that, you know, you have to make a choice between a basic system or a feature-rich system. You also have to consider things like, are upgrades available for that system? How much is additional hardware? Sometimes now companies— it's very popular— there's hardware and software as a service. So it's a— you make a small down payment and it's a subscription model, right? You know, which can also get you more, more bang for your buck, you know. And then the other thing is, will a cloud system work in your business, you know, where it's all up in the cloud? Or do you, you know, like somebody should told me, like, uh, we have a bar and they have like 16 cash registers in this place. They're showing me this cloud system they looked at. I said, do you think that thing's going to run in here? A cloud system. I know they have 16 customers because it's a massive place, like it's in a warehouse. Oh, so there's a bar, a big restaurant, it's a bar nightclub. And I'm like, you're not going to run a cloud system in this place, it's not going to run. And even if you hardwired it, it's still not going to run, it's still going to be trash. You got to have what they call a hybrid or a server-based system where there's an actual server on the location, and that's going to make your system run very, very fast, right, when you're using a server-based system. So people have to consider all of these things. And then technical expertise. You know, I was talking to some of the guys who work for us, and they sell a point of sale. And I go, when you sell the point of sale, you have to make sure who's responsible at the merchant location for learning how to use this point of sale, because if they don't learn to use it and you learn— and you're the one that's learned, you know how to use it— they're going to be calling you all day long for you to come over there and help them. So you want to make sure that they understand, like, oh, we're going to get it set up, we're going to get it configured. When they have a problem for troubleshooting and resolving technical issues, they know who to call on the phone, not to you. So you have to make sure that you, when you put in a point of sale system, that you know how to use your point of sale system, like you know how to use it, right? So you don't struggle with the technology and all that, and you understand. And don't overbuy the system, and we'll get to that in a minute. Don't overbuy. If you're not going to put all your inventory in there, don't be concerned about the inventory control features, you know. You are going to put the inventory in there, say, of a liquor store, okay, well, you know, how many items do you have? So you know, some point of sale has— oh, we go up to 8,000 items, and over 8,000 items you got to buy a different, you know, a different, uh, unit, right? Because you have too many items. You know, if you have a liquor store or a business where you buy cases, you know, like, and there's 12 in a case or 24 in a case, you need this specific type of software that can break the case, knows how to break cases. Right? Or let's say you're a clothing store or shoe store, then you have to have a software that has the ability to track things by size and color and style. And if you don't have that, then your inventory is just going to be messed up. So you got to make sure you're getting the right product for your correct business. And then scalability is also important. You know, what if—

you know, scalability in a POS system, what does that even mean?

So let's say you're going to open up Justin's Smoke Shop.

Okay.

And, and then you decide, okay, well, I'm going to— I know I'm going to open up 3 of these. I got 3 kids. Everybody's getting a smoke shop. Okay. So you want to make sure that you have a system that has scalability, that basically like franchise mode in it so that you can monitor all 3 systems remotely. So the— so let's say you have to move inventory from Store A to Store B, you can do it right there, right? So you're able to do that and account for it properly, you know, whatever it is that you need in your systems, you know. Because people put in a system— like, we have a guy who's like 5 smoke shops, so they put the point of sale on the first smoke shop, then they love it, and as the guy opens a new smoke shop, it's easy, they just copy over all the inventory. Into the next place, change all the numbers and, you know, put in all the real, you know, yeah, they copy in all the items and then they put in all the amounts, right? And then it's all tracked. Same thing, like we have a donut shop, the same thing. Every time they open a new donut shop, we just mirror the system up. Nice. You want to make sure that a system you have, if you're going to open up more locations, has those capabilities, you know. Or let's say you have one cash register, you're so busy now you need two cash registers. Registers, you know, does the company— how do those cash registers work together? Did they work together or did they work independently, right? So you need to make sure that they work together because you don't want them to work independently. Gotta be happy, right? So you have to understand, you know, how it can handle all of those things. And, you know, features and technology, like things like, does it have a loyalty program? Program. Like, how— if you go in a store, yes, don't you want to have a loyalty program?

It depends on— yeah, I mean, it's a—

somewhere you go all the time.

Yeah, I mean, I would like— I wish, uh, uh, Trader Joe's had a, like, some sort of, you know, savings program.

A saving program?

Yeah, some sort of pro—

like, you know, you spend $100, you get a dollar off, whatever it is. Whatever it is.

Yeah, I mean, because they have that at Publix, right? Like, there's some sort of—

yeah, now they have a thing at Publix. If you pay through their app, you get money back.

You get stuff free all the time. My dad, my dad was experimenting with it. He said it's, it's cool, but it's, it's a pain in his ass.

I haven't tried it yet. No, but the thing is, is that, that, you know, if you want customers to be loyal to your business, you need a loyalty program.

Absolutely.

You know, so those are things that are important. And then, is it card-based? People aren't going to put a card in their wallet. It's better if it's phone-based, so they just ask you for your phone number, right? Then you get your points. So it's important to have the capabilities that you want in your business because, you know, like, it's important— like, you have a barber shop, a salon, maybe you have a, um, a smoke shop or a cigar store, you know, those are things that you want to have in your, in your system, right, to do, to do those kind of things.

Absolutely.

And inventory management, like, you know, you could get like a small basic point of sale, but then it doesn't really manage your inventory. Managing the inventory, you know, obviously takes a little bit of work to get it set up so that, you know, you know, like, oh, you know, you get an alert. So let's say you have 50 cases of bottled water— bottles, yeah, 50 cases of water— and then you set it to, oh, when it gets down to 25, I need to know because I have to order more and it takes 3 days to get here. So those kind of things, you know, you need to set up so that you have, you know, you handle all that. So you have, you know, can track your sales. And like we talked about, let's say you have other locations and you move the inventory, can you handle transfers and things like that?

So that's— I didn't know you could do that all right through a POS.

Yeah, you can do a lot of things from a POS.

I mean, I knew the inventory, but I, you know, It's just, it's very robust now. It seems like that.

Yeah, you can even track like each employee when they log in, when they log out. There's time clock features. I mean, the features are endless. I mean, there's endless amount of features you can get. And then some things are very, very basic. They only give you, you know, 2 logins to the point of sale and limited, you know, tracks your sales, but it doesn't track inventory. Somebody might not really need to track. Let's say you sell donuts. Do you really need to track inventory? Maybe the drinks, but not the donuts, because you're making the donuts. But you do want to track how many you sold for the day.

Donut shops are a trip.

Yeah, how many you sold for the day, and then you see how many you're left over. Most of them don't have any leftover donuts.

Holy moly, donut shop!

Hello everyone.

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You're using— and then how does that interact with like e-commerce? Because e-commerce is big, like we talked about in the beginning. You want to make sure you have a point of sale that can actually extend out onto e-commerce platforms.

Yeah, speaking of that, there's some stuff in the works we can't really talk about, but yeah, it's really interesting, um, how you'll be able to connect the POS to your website soon.

Yep, that's pretty interesting stuff.

That— now that you can't do it already, but It's very bulky and it's slow and it doesn't work very well.

And yeah, but this would connect all the inventory to where sometimes you can do it, but the inventory is not connected.

So this is a— I'm looking forward to talking to those people.

Yeah, it's like, you know, it's very interesting. You know, there's— that's why we said on the— in the podcast that we did on for FinTech Friday about what are going to be the innovations in 2023. I think we're really going to see a technology explosion this year.

Really?

Yeah, I think we're going to see a lot of game-changing technology. I mean, I just got off the phone a few minutes ago with the guys from the ATM company talking to them about the cash recyclers. Yeah. And how we're going to implement that.

Yeah.

And so that's very, very interesting. The next thing people want to deal with all the time is, you know, what, what do you get for reporting and analytics, like tracking sales, tracking the employees, tracking hours, tracking the times. Like, you know, after you put in a point of sale system, sometimes you can go back in and you can track like, oh, where's my peaks and my valleys during the day? And over a period of time, you can start to see, oh, we're busy from this time to this time, and then it's very, very slow. So that can help you with scheduling, save some money for sure. Yeah, so that's what I'm saying. When you spend money, you save money. You know, and also like, gotta spend some money to make some money. And the other thing I think a lot of stores should consider in the future, like soon, because it's going to be available, is self-service kiosks. Okay, if you don't— depending on what you sell, right, I think you got to consider self-service kiosk in your place. Somebody could order something, place an order, pay for it, or place the order, and then they get, you know, they go take their slip over to the register. Maybe the stuff's in the back. We actually have somebody using this in a t-shirt, t-shirt business. So they have all the t-shirts on the wall, and then for right now, they go— the person goes to the kiosks, place their order, and then the slip prints out, and then they take it over to the desk, the person goes in the back because they don't want to have all the inventory outside because of, you know, kind of COVID everybody touching the clothes. But also they, they have a ton— they have so many different shirts. And then they go in the back and it's all tra— all the inventory is tracked. So they go in the back, they pull the order. Oh Bob, your order's ready. And they get tons of like people in their shop at one time because buses come there. It's a tourist spot. Yeah, so a bus will drop off 30, 40, 50 people, right? Then they start all start buying stuff. So they don't want— that they were losing people.

This is in Atlantic City?

No, it's in Hawaii. But they were losing business because people were going at— people were going to the— they didn't want to wait in line at the register. So now they put in a kiosk and they just pay on the kiosk, and then they just take the slip over. The person already sees the order in the back, comes out with the— with the shirts.

That's smart.

Yeah, because they have a lot of shirts.

I always like at the kiosk though. Like I was just at McDonald's for my kids. Yeah, I ordered from the kiosk and they still got my order wrong. Oh, like, how is that possible? Sway. I didn't verbally tell it to anybody. I pushed it in because they don't know how to read.

There you go. And then, you know, also, you know, you can generate all sorts of reports, your analytics for decision making. And integrating to your accounting system. And the other thing is, you know, integrating— using your point of sale system and getting the data out of there, like the telephone, the text phone numbers, email addresses, and then using, you know, exporting that out using something like MailChimp. Or depending on your clientele, maybe you're collecting more text message phone numbers and getting a texting platform and then send it out. You know, coupons, text coupons, or getting people to order stuff off your website, right? And offering things on the website, you know. And the other thing people— so in conclusion to the whole thing, budgeting, what do you think? Is very important. People need to budget for this, for their point of sale system. Yeah, they need to budget for their technology.

They need to when they're creating a business plan and they need it when they thinking about the equipment or how to make their business operate, they need to budget for technology for sure. Laptops, cameras, point-of-sale systems, whatever it may be that you're going to need to, to flourish in your business. But yes, one thing that I highly suggest is if you're going to be taking payments or you have physical merch, you need to do your research onto the best point-of-sale system for you and your business. If not, you'd just be throwing money out the window, losing money, not, you know, retaining customer information, not getting the correct data reporting stuff that you need there, you know. So yeah, I agree 100%.

Yeah. And don't think—

know what you're going to buy.

Don't think of it like some expense. Oh, the credit card company or the point of sale companies charging me too much money. And you know what I mean? Think about what you, what you want to accomplish at your business. Oh, I want to have a kiosk. I want to have a register. I need 2 point-of-sale registers. I need a website, right, to sell my stuff so I can have curbside pickup and, you know, and have a flag or a cone outside or a sign, right?

I mean, like, as a small business owner, you should— how do you like to pay for things, right?

Yeah, think about it and make sure you're accepting Apple Pay, Google Pay, tap-and-go cards, and all of these things. I've even seen some stores, you know, they— an extension employee has a tablet in their hand, they can line bust and check out a person like on the go. Yeah, you know, and that's what— yeah, you know, that's what you have to do. Some of the systems will let a person ring it up and then they just go over to the cash register and pay, right? So you have to see what, what you want to do in your business that can help you save money or even extend your business out to— oh, we're going to have a sale on the sidewalk, or we're going to go out to the local Chamber of Commerce and sell stuff at a fair that they're having or a small business event, you know. And the other thing businesses need to consider is cash discount dual pricing method, where you're adding 3-4% to your price, and then when people pay with cash, they get a discount. I mean, this is going on in, in businesses every day, you know.

I still haven't really run across it yet.

No, I think that it's— it— I think it just depends on the business type and the area.

You're right. What type of businesses are using it right now?

Um, we see a lot of like auto repair places.

It's exactly what I was thinking in my head. I knew you were gonna—

and a lot of bars have it. Nightclub bars have a cash instead of using— no, because a lot of people come in with cash.

I mean, besides the gas station thing, every— you know, obviously that's—

yeah, it's everywhere. And gas stations have been doing it before everybody was.

Yeah, they were the first on board, you know, cash price, credit price.

And I don't think anything's wrong with it. I mean, I think we're seeing more and more adoption of that. Um, some business owners are not comfortable with it. Listen, if you're not comfortable with it, then you just mark up all your prices, right?

So what— I mean, why I think businesses are uncomfortable because of the COVID or is—

no, just they just don't want to pay credit card fees, so they just figured they charge the credit card fees to the customer.

So I'm saying, like, what—

so the cash discount though, like, why don't they Well, during COVID businesses wanted to save money, so they were losing money.

Excuse me.

So that was a way for them to kind of stop losing money. But now you see a lot of people institute, like, institute, um, they instituted in a dual pricing method. So what happens is, oh, here's the price, let's say $50. Oh, if you pay by cash, it's only $48.75, right? Nobody, hardly anybody pays with cash. I was talking to a business owner the other day. They're like, yeah, we have— we see zero cash in our business.

Cash is—

I, I've— speaking of cash, but then I have other businesses that have tons of cash, right?

I'm just saying, like, cash is like, it, it's still king, but you go to these other places and, and, you know, they don't really want to take the cash, right?

So, you know, you have to remember, successful point of sale implementation into your business The business owner and the employees need to take the time to learn how to use the system so that it's used successfully, properly, right? They're getting the most out of it, you know. And prepare yourself, budget yourself, that you're getting, you're get— getting the most bang for your buck, right?

Right.

And you're getting what you need. So if you need a point of sale station, you need a website, you need— you want to get a system that's going to do all of that for you. And don't look at it like, oh, that costs so much money, right? Because a lot— most of the time now, all these— a lot of the companies, especially ones we deal with, it's all hardware and software as a service. So if you were buying a point of sale system, let's say 15 years ago, they would go, oh, it's $15,000, right? Oh, you need a website? Oh, let me give you Justin's number, that's $5,000. And now you're spending $20 grand. So, but now you can get all of that in a monthly fee and maybe a small down payment. And you got my website, but yeah, no, but I'm just saying, like, now, you know, I mean, we were talking to somebody the other day, they were talking about making— taking WordPress and making it act like, uh, Shopify, Wix, etc., etc., etc., Square. You know, and making it easier for people to be able to make their own website. Not so good for people who make websites, but that's not fair.

I mean, the whole website builder thing, that's been going on for a long time, right? It's not stopped the show.

No, it hasn't stopped the show because some people need a website that's, that's, that's a brochure that tells about their company, that has their products on it, and they're not necessarily always doing e-commerce. You know, I think in e-commerce area it's kind of evolved. But you know, today in your business, you know, so what we talked about was, you know, you know, get your budget in line with what you want, get your— sharpen up your— get ready to learn so you sharpen your expertise up on whatever you bought. Make sure it's scalable. Make sure you understand how to use the inventory management system and the other different features like loyalty, right? So you can put all that stuff to use and get— make sure that, you know, you know how to use the reporting and the analytics and linking it up to your accounting. All of that can save you a ton of money, you know, by doing that, because now you're not having to do manual entry for accounting and all these different things. So when you look at what you're spending, you also have to look at what you're saving.

Absolutely.

But sometimes, like, I was listening to a podcast the other day that a guy did, and the guy said, oh, it's not about all the things that you're doing, it might be the things that you're not doing that's costing you money. And it could be that, you know, if you had the right technology, right, if you're using the right technology, that that technology could be saving you time and money.

Absolutely.

So it's very important. So that's our podcast for today.

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