One of the most valuable purchases you can make for your restaurant is a strong point of sale (POS) system. It is important to investigate options that fit your restaurant, system flexibility and customization, and how the total cost (initial and annual) fits into your budget.
These days, restaurants are familiar with the ins and outs of a POS. But if you’re looking for an upgrade in order to improve your workflow, employee communication, and customer service, a new POS might be the right choice. When you’re in the market for a new restaurant POS system, think about a variety of potential costs before making the proper financial choice.
It will take some extra work as you will need to balance those costs with potential savings. Depending on the POS, you may see efficiencies in how you manage budget and workflow, inventory, menu management, reservations, and payroll, in addition to other objectives that affect your restaurant. When it all comes down to it, be sure to examine the costs of:
Legacy vs. Tablet
A major factor that determines the cost of your new restaurant POS system is whether you’re looking for a legacy POS or a tablet POS. While they technically function in similar ways, legacy and tablet POS systems carry a variety of different costs that make the choice between them incredibly important.
Legacy POS Costs
A legacy restaurant POS system involves large, hardware terminals that are updated manually. They are usually bulkier, slower, and more expensive than mobile, tablet-based POS systems. A major part of the cost is due to the fact you’re installing an entire computer system into your restaurant that must be operated through a local network.
Tablet POS Costs
A tablet POS distributes tablet-based software into mobile terminals throughout your restaurant. Instead of basing your operations around a central computer installed into your restaurant, this type uses cloud-based software that you can easily update and adjust for your needs. Tablet systems are also an affordable option available to restaurants who are looking for an alternative to a legacy POS.
Payment Processing and Receipt Management
When you’re trying to understand the comprehensive costs that a POS system entails, payment processing can seem like a hidden cost that can tighten your budget. It’s safe to say payment processing is something you’ll want to address in the initial research stages. This is a piece of the cost not included in the implementation and upkeep; it is related to banking and card processing fees. With this said, paying a little more for a system upfront could cut down on potentially burdensome fees. You should, for instance, pay attention to the following:
In-house Processing Fees
POS systems will charge you either through a monthly usage fee or through a credit card processing fee that will make up for the lack of a monthly fee. This can come in handy if you’re not planning to use a different merchant account and want to keep your payment processing fees contained within your restaurant’s point-of-sale system.
Merchant Account Processing Fees
Other point-of-sale systems give you the option to use a pre-existing merchant account if you already have one set up. In this case, the cost will depend on the processing fees of the merchant account. This ends up turning the processing fee into a non-POS related fee, but the fact that your restaurant point of sale system still deals with this fee, as well as the fact that it’s based upon your sales amount, means that it’s still a cost worth considering.
Credit Card Fees
With a wide variety of credit card processing options available, it’s important for you to understand how your POS system deals with payment processing and how it will affect any additional costs for your restaurant’s point-of-sale system. Does your merchant account use flat-rate processing or tiered processing? What is the general pricing structure for the processor? These are the kinds of questions you’ll need to answer in order to properly assess how a POS system’s payment processor will change your budget.
Terminals/Tablets, Additional Hardware, and Customization
While terminal and plan costs are the primary decisive element in the cost of a restaurant POS system, you should make sure you fully understand what essentials make up this number. Specific elements that make up your POS product provisions include:
Product Plan Cost
Providers offer different hardware bundles and product plans based on the size and potential expansion of your restaurant. Whether you’re a burrito truck or a seafood chain, a scalable POS system is critical if you intend to grow or add restaurant sites. In order to address this, figure out what the main purpose of your restaurant POS system is (managing the back end or assisting with customer service), then look at the plans that best address those needs. Put together a list of the essential features you need so that you can narrow down your search.