Pros And Cons Of Cloud-Based POS Systems In Retail

Known also as SaaS (Software-as-a-service) platform, A cloud based POP is a point of Sale Service that utilizes the cloud for remote data storage, as compared to Legacy POP systems that use local storage. So, how do you choose which POP system is right for your business? The experts in the indsutry have offered their opinions on cloud-based POP Systems so that you can have all the information you need to make your decision.

Pro: Mobility, Con: Connectivity

“With a mobile POS, sales associates can look up details and close the sale right on the shop floor, making it easier to engage customers. Small and medium-sized retailers that want to be versatile on the shop floor without spending a fortune in technology may use cloud-based apps to use their cell phones or tablets as a POS at no extra cost.” says Mike Dragan, COO at Stream Live, who states the main disadvantage of the system being connectivity, “This configuration requires that the computers be connected to the internet at all times. You face service interruptions if your connection is unreliable or haphazard. To reduce the risk, some retailers employ two separate network operators, so that if one fails, the other may take over and no sales are lost. You may benefit from a web-based Point of Sale, or you can opt for a POS that can operate both online and offline, depending on the reliability of the service in your region.”

Pro: Only Basic IT Knowledge is Needed, Con: There are no Customization Options

“Small and medium retailers also lack in-house IT expertise, and recruiting external consultants can be prohibitively costly. All service-related issues are resolved directly by the provider with cloud-based applications. This not only saves money for retailers, but it also means that all problems are resolved quickly.” says Steve Scott, CTO at Spreadsheet Planet, while highlighting the lack of customization as a disadvantage, “SaaS does not allow for software customizations due to its deployment model. Larger retailers may tend to go with tech that can be easily customized to their brand and needs, even though this aspect will not be a barrier for many small and medium retailers who have little to no time and money to spend on personalizing of the POS colors and look.”

Pro & Con: Subscription Pricing

“SaaS is typically sold on a subscription basis, with the retailer paying a monthly or annual charge with little or no up-front costs. This model is also more affordable for a small retailer than conventional software: on the one hand, the initial investment is low; on the other hand, the  monthly payments include not only the software and also data backups and potential updates, eliminating the possibility of unexpected charges down the road. The subscription model, on the other hand, is inconvenient for all retailers. Monthly subscriptions can become as costly as conventional software in the long run, based on how many devices and features you really need your company and how long you need them. Before you buy, make sure you’ve done your homework.”

Hamza Ghayas, Marketing Manager at GSDLovers

Pro: Easy to Grow and Shrink, Con: Limited Support

“When each POS device is charged on a monthly basis, it’s simple to add or remove devices as required. Peak season? Are you planning a holiday pop-up shop? Increase the number of devices on your monthly contract for four weeks, then reduce it to the original number. You won’t even need to purchase additional hardware because any phone with an internet connection would suffice.” says the  Founder and CEO of Solitaired, Darshan Somashekar, who also says that the limited support of such a cloud-based system is a drawback, “Although online support is sometimes available (our own LS Express provides extensive online help), cloud-based POS are typically simple and clear enough that no specialized support is needed or provided. Retailers who run large businesses and need customized advice and consulting may opt for a traditional deployment model that better suits their needs.”

Pro: Backup and Replication, Con: Security

Stewart McGrenary, Director at Freedom Mobiles, says the best aspect of Cloud-based POP Systems is the data backup, “The most significant advantage of a cloud-based POS system is data backup and replication. Nothing is more frustrating than losing important data, or getting electricity shut off on-site, with no way to restore or get back to work. Operations are halted, and the company could be forced to close. Sensitive applications, reporting, and data storage are all handled offsite through a cloud-based POS network, expanding the number of devices that can access them. Many now have mobile solutions, even if the electricity goes out, you can still conduct business using the battery power of your smartphone or tablet. Data loss and machine downtime have an effect on revenue, customer loyalty, and efficiency in a variety of industries.” Yet, security on the cloud is also an issue, as McGrenary explains, “You can simply keep your data off the internet, which is where it is safest, with a software-based POS platform. You give up a lot of comfort in exchange for a higher level of security. Keep in mind, though, that you’ll also need backup plans, and if your data is compromised, you’ll only have access to in-house or credit card processor technical support. It’s also worth noting that data breaches can still occur with software-based POS systems and that regardless of the POS system you use, you’ll need to follow PCI enforcement regulations to help reduce the risk of security issues.”