How Point-of-Sale Data Can Elevate Retail Businesses
As technology develops, there are all sorts of data sources that can contribute to business decision-making, and some sources are harder to use or understand than others. But one of the most accessible and important sources for retail businesses is point-of-sale (POS) data. This allows them to properly record and analyse how, what, when and where customers are buying from them, and then take relevant actions to maximise sales opportunities and increase the efficiency of business operations.
POS data has only recently become truly incorporated with technology to help businesses leverage it effectively. In fact, innovative Kiwi POS software company Vend recently sold for almost $500m to a larger Canadian POS software company, Lightspeed. Vend has developed software that lets businesses collect, track and analyse their POS data via an iPad app. The app connects to EFTPOS data and online payment channels to monitor the full range of a business’s sales. The demand is high for retail businesses of all sizes to be able to receive important POS information at the tap of a button, and find actionable insights that they can use to improve their decisions. So what does this data look like specifically?
Product Trends and Insights
Which products are trending down from last year in terms of sales? Which products sell best in the morning? In the afternoon? Which products are proving attractive to a certain type of customer? This information is all available through POS data, and with the latest software it can be analysed in real-time. It lets businesses make optimised decisions on when to give discounts, when or how to promote certain products, and what needs to change in their offering.
Customer Trends and Insights
Once a business has built up a database of past sales and even individual repeat customers, the data collected will enable the business to offer smarter deals and suggestions for customers. This can take the form of product affinity, where past POS data can clearly show what products are frequently bought together, giving a business insight into what product recommendations should be given to certain customers. Or, it could take the form of personalised offers, based on a specific customer’s (or type of customer’s) past purchase activity. After all, Segment research found that 49% of shoppers made impulse buys based solely on personalised recommendations made to them. POS data can even give deeper insight into why customers return products or seek refunds, and businesses can act on that data to avoid problems in the future.
Essentially, POS data gives truer, more accurate insight into customer behaviours than surveys ever could, as the proof is in the payment. The value of POS data is reflected in the success of POS platforms such as Vend or Lightspeed, that make it easy by offering instant data collection and analysis tools for businesses to hit the ground running with POS data.
Forecasting Demand and Supply
POS data is also the key to accurate forecasting of certain elements of a business, and particularly demand and supply. In other words, the data will tell you when you’re likely to get a lot of customers, and when you’re likely to need extra stock or have a surplus of stock. The inventory management aspect is particularly helpful for businesses with a number of locations, as cloud-based innovations sync up the data across all of them.
In the transition to AI in business, collecting and storing past sales data will enable businesses to automate certain tasks such as reordering supplies at the right time and right amount, or setting shifts for employees to target the busiest times of the week. This lets managers spend more time on dynamic and high-importance tasks that require human attention.
Tracking and acting upon POS data has only become more important as businesses grapple with more sales channels and faster transactions than ever before. With the rising popularity of digital payment solutions, the role of cash registers is slowly being phased out, and replaced by digital technology that provides instant POS feedback. As with most important and ubiquitous technologies, POS platforms don’t do anything drastically new, they just make it a lot easier for businesses to do what they have always done.
Published by Alex Jordan