Your POS (point of sale) system is the most important piece of technology in your restaurant. These days, restaurant POS software does a lot more than just taking orders and printing checks. A good POS system can also help with inventory management, scheduling, payroll, and more.
In fact, a growing number of POS providers now offer all-in-one systems that include nearly everything you need to build out your restaurant’s tech stack. So naturally, the POS system you choose will have a huge impact on the way you run your business. It’s essential to choose wisely.
But what exactly should you be looking for in a good POS system? What are your options? And how can you avoid hassles, headaches and hidden fees? I’ve assembled a friendly guide to help you answer these questions and a free, downloadable Restaurant POS Guide so you can be sure you’re getting the best restaurant POS system for your business.
Server vs. Cloud: Know the Difference
Before you even start shopping, you need to know the difference between a server-based POS system and a cloud-based system. It’s pretty simple:
- A server-based POS system runs on an onsite server, which is just a computer that lives in your restaurant’s back office. As recently as five years ago, most restaurants were using this type of legacy system, with service from big-name providers like Aloha, Micros, and POSitouch.
- A cloud-based POS system runs through your internet connection, and the server is housed offsite and maintained by your POS provider. Today, most restaurants have already adopted cloud-based systems or have plans to upgrade through leading providers like Toast, SpotOn, GoTab, or Square.
Today, more and more restaurant operators are moving to cloud-based platforms. This is because a cloud-based POS lets you manage your sales, labor, and menu from anywhere, including your mobile device.
Why Most Restaurants Have Moved to Cloud-Based POS Systems
Back in the day, the primary benefit of using a server-based system was that you didn’t have to rely on your WiFi to process payments or send orders to the kitchen. You got the stability that comes with having that server directly in your back office.
On the other hand, those server-based legacy systems could be expensive to maintain. This is because you needed tech support to come out to your restaurant every time you needed to add functionality or update your software. The opposite is true for cloud-based systems. Updates are usually fast, free, and mobile friendly.
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Of course, your POS system does depend on the internet to work. So what happens if your internet suddenly goes down on a busy Saturday night? Actually, modern cloud-based POS providers have an answer for this.
All the leading POS systems for restaurants now have what they call “store-and-forward” modes, which means most functions are still available even when your system goes offline.
Building Your Restaurant’s Technology Ecosystem
You’re not just buying a POS system anymore. You’re buying an entire ecosystem.
“Ecosystem” is tech talk for the full array of apps and platforms you’re using, and how they interact. Your restaurant tech ecosystem should probably include:
- Online ordering and QR codes
- Loyalty programs and CRM (customer relationship management)
- Inventory management
- Staff scheduling and payroll
Your tech ecosystem, or tech stack, is kind of like your kitchen. Everybody has a different role, but everybody has to work together without arguing or ignoring one another. Modern POS systems are the same way. You need to make sure that all of these pieces work well together.
You have two options:
- An all-in-one POS system comes with most of the applications listed above already included.
- With a multi-vendor approach, your POS system provides a foundation with key features like payment processing, but you would choose specialized providers for added functions like inventory management, staff scheduling, and payroll management.
Choosing Between an All-in-One POS System and a Multi-Vendor Approach
Most of the leading POS vendors brag about providing “all-in-one” solutions. An all-in-one system is a good option for restaurants that want to keep things simple. This approach is usually more streamlined, more efficient, and more cost-effective than juggling multiple vendors.
You’ll have fewer logins, passwords, and dashboards. It also makes things easier for your team. Everybody has access to shared ordering systems, payment processing, inventory management, shift scheduling information, and everything else with one application.
On the other hand, there are some advantages to building your own ecosystem using multiple vendors. Each vendor you work with will be narrowly focused in one specific area of operation. This narrow focus allows specialized vendors to put more emphasis on things like innovation, flexibility, and high-touch customer service. Simply put, this approach could give you access to superior technology.
But you should keep in mind that working with multiple vendors is usually more costly than working with a single all-in-one vendor. In addition, if you do choose the mult-vendor approach, you should start with a POS system that can integrate with all of your other vendors.
How to Avoid POS System Headaches
The big question when you’re choosing a POS system isn’t just “Can it ring up my orders?” It’s really about whether or not it can connect all the pieces of your business without hidden costs or hassles.
Whether you choose an all-in-one option or you piece together your own tech stack with the help of multiple vendors, it’s still absolutely critical that you choose the right restaurant POS software as your foundation. Below are a few tips for choosing your restaurant POS system without the headaches.
1. Ask About Payment Processing Fees
Leading cloud-based POS vendors like Toast, SpotOn, and Square will require you to use their in-house payment processor. Payment processing fees may vary. Beware of POS systems that offer lower subscription fees but higher payment processing fees. Over time, this cost breakdown could cost you thousands of dollars more every year.
2. Consider the Hardware Requirements
Most POS systems for restaurants let you manage information, take orders, and accept payments on iPads or Android tablets. But some leading providers like Toast and SpotOn encourage the use of their own handheld devices, which are built with greater durability but may also come with lease or purchase costs.
3. Choose a Platform That Matches Your Operational Needs
Some POS systems are better than others for handling events, large checks, or multiple service areas (such as dining room, patio, and take-out). If you are running a complicated operation, you should look for a POS platform that can handle:
- Large tabs ($1K–$5K) without lag
- Separate revenue centers (for instance, bar vs. patio)
- Event deposits and pre-orders
A Few Things To Know Before Picking Your POS System
Think you’re ready to pull the trigger? Not so fast. Before you sign a contract, remember these three things:
1. You’re Making a 10-Year Commitment
Switching POS systems is disruptive and expensive. It’s not something you want to do every other year. Make sure you choose a system that can scale to accommodate your future plans, whether you want to add catering services, open a second location, create an event space, or whatever.
2. Vendors Are Competing for Your Business
Toast, SpotOn, GoTab and others are fighting for market share, which puts you in a good position to get a great deal.
Always ask about:
- Matching payment processing rates
- Options for leasing vs. buying the necessary hardware
- Contract length flexibility
Pro Tip: Be wary of any “Free for Six Months” offer unless it’s a product you know you will keep. Otherwise, you’ll forget to turn it off after six months and end up paying for a subscription you’re not using.
3. Other Customers Are a Critical Source of Information
Vendors may tell you one thing about what it’s like to use their system. Their customers might tell you something else entirely. Talk to at least one current customer with similar needs to your own. Ask about their experience as end users, any challenges they’ve encountered, and their overall satisfaction with the system in daily operations.
Do Your Due Diligence
You can also learn a lot by talking with an industry insider. Reach out today and schedule your free personalized consultation with me so I can help you find the best restaurant POS system for your operation.
You can also download our free, super-handy Restaurant POS Guide and start narrowing down your search for the right restaurant POS software today.
