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How Do Point of Sale System Work?

So, how does a POS system really work? The honest answer is that there is no answer. Or at least no definitive answer. Regardless of how the system is designed and meant to be used, every merchant will fundamentally use it in their own unique way based on their specific business needs. Why? Because no one system will work exactly the way it would if you had designed it.

The key is to do your research and choose the POS system most suited for your needs and to know what your deal breakers are — features you absolutely cannot live without. Regardless of the POS you choose, there are some basic operational components that will be available in all reliable point of sale systems.

Setup POS

First and foremost, in learning how a POS system works, is becoming familiar with the setup process. This will consist of both the physical hardware components as well as the software and system data. Once the account has been set up through your POS provider, you (or the provider, depending on the nature of the agreement) can get started with adding inventory, employees, customers, or anything else that needs to be customized to your business.

The hardware side of the equation will vary depending on your specific business type. For example, in a retail business using a cloud-based solution like ShopKeep, your POS terminal will be in the form of an iPad cash register that will run the software to process sales. In the most common setup, it will connect to a cash drawer, a receipt printer, and a barcode scanner — collectively these are known as peripherals. All of these peripherals will need to be configured in order to ‘talk’ to the software. This can be done in a variety of ways depending on which exact peripherals you are using. For example, pairing a Bluetooth barcode scanner to ShopKeep’s iPad cash register would be similar to pairing a Bluetooth headset to your cell phone. The data communication avenue (Bluetooth) is the same, therefore, the setup approach will be the same.

Sales and Returns

Just like standard electronic cash registers, you will need to be able to perform the basic business functions of sales and returns with your new point of sale system.

If working in retail, ringing up an item with a barcode scanner is simple. You simply scan the UPC of the product and the product information — such as name, price, and tax — will populate in the POS. If you don’t have a barcode scanner (although we strongly suggest it if your business type falls under retail), with ShopKeep, you can always manually add an item to a transaction by tapping on the corresponding button or search for it by name. Once all the items are added to the order, you will then select the payment method and close out the sale.