Observations

EDI is a general name for a number of techniques to communicate electronically (via e-mail or an FTP server) with your supplier. By linking your POS system of business software directly to the sales software of the supplier you save a lot of time and you have less errors in your supply chain.

EDI documents contain the same data that would normally be found in a paper document used for the same organisational function. An EDI document may contain a ship to address, bill to address, a list of product numbers (usually a UPC code) and quantities. It may have other information if the parties agree to include it.

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Barcode scanning can save you a lot of time. That is what Joel Spolsky found out when he decided to ship his own DVD’s:

Barcodes are the greatest thing since sliced bread. I didn’t think we’d need a barcode because all we had to type was an eight digit order ID. Lo and behold, typing an eight digit order ID three thousand times adds up. The three day ordeal would have been a two day ordeal if we had thought to put barcodes on the packing slip and had a scanner to read it.

Scanning barcodes is the fastest and most accurate way to sell products at the Point Of Sale.

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The biggest problem for Point Of Sale system vendors are the traditional cash registers. Cash registers not only take a big part of the market, they also influence what shop owners expect from a POS terminal. Many shop owners switching from a cash register to a complete Point Of Sale simply want the same functionality and the ease of use of their old equipment.

I have done some POS implementations where I delivered exactly that: a POS system configured to emulate a cash register, with a few buttons on the sales screen to book sales on the various product groups, but without inventory control, reporting and all other features that make a POS system worth its money. The idea is to provide them the same way of working in a new environment to get the employees used to the new system. Once they now how to sell using the old-fashioned buttons I have them take an inventory so they can start selling using the barcodes on the items. Little by little they get deeper into the available features of the system, and the system becomes more valuable.

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Today one of our dealers contacted me, and asked me whether I could send them a benchmark document; they had received this request from ‘‘prospective customer‘. First I wanted to know what kind of data they needed, and the answer was: we want to see how your product performs compared to the Industry Standards (the emphasis is mine). They also send me an example document of such a benchmark.

Of course I was really curious about this report, since in my opinion there is no such thing as an industry standard for Point of Sale systems. The POS market consist of thousands of small local suppliers, and I seriously doubt they can get together to create an industry standard.

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My job at the international department of a POS software manufacturer taught me one thing: we find a completely different situation in every country we start working.

We have a broad range of products, and we always suggest our foreign partners to start with only one product. Usually we advise starting with software for restaurants and bars, since these are easier to implement. And once our partner is familiar with that software, they can easily add our retail software to their catalogue, since the basis is the same.

Penetrating a market this way has the easiest learning curve, but sometimes the reality of a specific market prefers another approach. I’ve found some markets in the north of Europe with a restaurant Point of Sale manufacturer in every town. The quality of these products does not always reach ours, but the sheer number of competitors increases the effort we’ll have to do drastically. In those cases we look at the market and pick another business type as our target, such as fashion stores.

New dealers always ask us how to begin, but they know their market better then we, and if they don’t know the market, it is a lot easier for them to get to know it. All we can do is give advise, but we’ll always have to trust on the insight of our local partner. They are our hands, eyes and ears.

The title of this post is quoted from an excellent post by Go Daddy founder Bob Parsons. Though he has nothing to do with point of sale systems, he has something to say that matters for any company: old news is of little value for taking decisions. As a business manager, you make decisions each and every day, and on every hour of the day.

If you own a small shop, with only one till, you’ll find yourself checking reports from the POS systems once in a while. And whenever you run this report, the point of sale shows you the sales data and benefits up to that very second. In other words: you base your decisions on real-time information.

As your business grows to lets say five shops, your decisions become more important, and your need for up-to-dat information grows. But most multi-store managers don’t have up-to-dat information. They have to base their decisions on yesterdays Z reports from the POS systems and on last months financial reports.

Of course this is not necessary. Modern POS systems link in real-time to your backoffice software, so you can follow your business on an hourly basis if needed. These POS systems don’t have to be more expensive than the systems without real-time communication, but if they are more expensive you can earn your extra investment back by taking your business decisions on current data.

One of the charms of the Point Of Sale business is that it is dominated by small companies. Of course, companies like IBM and Epson produce POS hardware, but both companies have set up very specialized departments that work separated from the rest of the company. Don’t try to find drivers for Epson receipt printers on www.epson.com; you’ll have to look at the site of the Epson SD group. In the POS software market, the presence of the big guys is even less prominent. Microsoft does have POS software, but they hardly sell it outside the USA.

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Though you hardly ever hear about it, black money is still common in the SMB sector. I came to realize this during my holidays in Italy, when the following happened:

After eating a very good pizza in a fine restaurant in Rome, we asked for the bill. A minute later, the waiter returned and told us that we had to pay 40 euro. The waiter did not give us a subtotal, as he obviously wanted to do a black transaction. One of our friends however, thought the waiter wanted to keep the money as a very big tip, and requested a subtotal on paper. The waiter disappeared again, and returned with a subtotal for 33 euro, telling us that he made a mistake and that we had to add the starters —7 euro each— giving a total of 47 euro. We paid and left with the receipt showing only 33 euro. What happened was that the waiter simply gave us a receipt left on the table by other guests —proven by the fact that the pizzas on the receipt were not the ones we’d eaten— and used it for us. So he effectively had transferred the previous sale worth 33 euro and our starters —14 euro— to their black bookkeeping.

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Don’t trust the web when selecting your Point Of Sale! You might already have found out that it is very difficult to obtain objective details about POS systems, since the high rankings in the search engines are filled by spamvertised ‘blogs’.

Today I found out that ‘normal’ looking site cannot be trusted either. I came across a site made to help customers in selecting POS softawre. It was a good-looking site, with reviews of several applications. Since our own product can always use a little bit of exposure, I sent a message to the site owner, telling him that if he wanted he could receive a demo copy of our software for review. This was his answer:

You can submit a sealed bid along with your own review for the month of July. The highest bidder gets the highest rating.

And such a site claims to help the customer?! Do not trust the web, find a good POS specialist instead!