From Point-of-Sale to Point-of-Service
At its core, a Point of Sale system (POS system) is simply a system used by companies to process and record transactions and by customers to pay for goods or services. At a closer look, anyhow, the definition of POS is inadequate to say the least, as these platforms do much more than just processing transactions. That is why, in recent years, Points of Sales have been referred to as RMS (Retail Management Systems) or Point of Services, names that better fit with the suite of tools that modern systems offer. All of this complexification can easily lead to different POS End-of-Life issues as hotels look for their next solution.
Some History on POS Systems
These suites are the natural evolution of the old Electronic Cash Registers (ECR), a technology that is been around for decades. Already in the early ’70s, in fact, IBM launched the 3650 and 3660 systems, using (for the first time ever) client-server technology and P2P communication via LAN, while McDonald’s was among the first restaurants to use a microprocessor-controlled ECR. The ’80s marked the evolution of ECR into the GUI-systems we are familiar with today, with the introduction of touchscreens and widget-based interfaces. With the new century, the rise of cloud computing made it possible for Point of Sales to be accessed directly with a click via a simple browser, anywhere, anytime and virtually on any device.
A Vertical Industry
POS systems are used by different Industries, that is why Point of Sale providers tend to be extremely vertical. A hotel has different needs from a wellness center, for example, and F&B is no exception. A good restaurant POS should be able to, among many other things, generate guest checks, send orders to the kitchen in real-time, process payments, manage inventory, stock, vendors’ orders, and financials, aggregate data in reports, create programs for loyal customers and support digital signature. Not unlikely Property Management Systems (PMS) for Hotels, a good POS should be the pulsating heart of any successful restaurant, helping to remove frictions between departments, enhancing customer experience and, consequently, increasing profits. But, exactly like PMS, finding the right system for your needs could be a painful experience.
Investment Amortization and End-of-Life Announcements
One of the intrinsic, though underestimated risks of choosing the wrong POS system is technology obsolescence.
With on-premise solutions and systems that are built for specific hardware, this problem is inevitable. Due to the rapidly changing world of computer hardware, such systems will become obsolete.
As cloud-based systems made the old on-premise platforms outdated, most of the established POS vendors had to review their approaches, sometimes by taking drastic measures such as shutting a whole system down. The main problem with proprietary on-premise systems, in fact, is that they tend to have a way shorter life cycle when compared to hardware agnostic, cloud-based alternatives, that are virtually immortal, as they do not suffer from the limitations of the underlying technology. This unavoidable decline of technology is usually referred to as EOL (end-of-life). End-of-Life announcements can have a dramatic impact on a company day-to-day operations (staff retraining, new system learning curve, etc.), as well as on profit: as POS systems tend to be a long-time investment, getting stuck with a system that is being withdrawn from the market means not being able to amortize it.
Why Cloud Based Systems are Safer
A major reason cloud-based systems are a safer bet on the long term is that the essential parts (the data) are stored and managed separately from the end-user input terminal. So when systems need a different input method, the user interface can be added while plugging the existing data to it, instead of creating a whole new system and pay for expensive data migration, or worse, losing the historical data.
What to Do About POS End-of-Life Issues
If you are thinking about upgrading your current POS, or you are facing the difficult situation of being left with a dismissed system, make sure to have all the information in order to take the right choice and do not forget the three golden rules: be agnostic, be in the clouds and be open:
1. Be Agnostic
Always prefer agnostic solutions: you should be able to work with any hardware supplier and not be limited by the underlying infrastructures of a POS;
2. Move to the Cloud
Always choose cloud-based solutions over on-premise ones. Possibly, cloud-native. You should not be worried about EOL;
3. Be Open
Prefer POS systems that offer public APIs for easy, inexpensive third-party software integrations. You should be able to connect whatever solution you may need down the road.
4. Partner Wisely
Look for a partner that serves you their clients like hotels and restaurants serves guests. The best technology systems still need service and when there’s a problem you need to know you can rely on qualified experts that care.
This article was originally written by the Infrasys team. It has been moved here as part of the Shiji Group family of hospitality technology brands.