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Why Your Restaurant Needs a POS System

Why Your Restaurant Needs a POS System

The term Point-of-Sale (POS) is often associated with the idea that you're simply processing payments from customers. However, modern POS systems can do so much more than that.

POS systems can be used to increase sales and improve the customer experience—all while helping you make better decisions about how you run your business. Restaurants represent some of the best-known uses of POS systems, and it’s no surprise that they stand to gain so much by leveraging modern POS technologies.

In this ultimate guide, we’ll explore the benefits of POS systems and how they can be used to level up your business.

What is a Restaurant POS system?

A restaurant POS system is a combination of software and hardware used to centralize a restaurant's business management at the point any sale is made. POS systems are used by restaurants, retail stores, hotels, and hospitals that need an efficient way to manage their cash flow.

In the case of a restaurant, customers are greeted by an employee who uses a POS system to input their orders. This information is immediately forwarded from front-of-house staff to the back-of-house either the kitchen or the bar where the items are prepared.

POS systems have direct access to sales data since they’re situated at the point that a transaction occurs between the business and the customer. As a result, they present many opportunities to improve business operations.

Here are the 10 key benefits of a good POS system:

1. Speedier transactions

The faster a transaction can be made, the faster you are able to serve more customers. This is a critical metric to improve when, for many restaurants, the optimal table turnover time is about 45 minutes. After all, by targeting that, you can directly improve your bottom line.

With a modern restaurant POS, you can make the transaction process for your staff easier. All they need to do is enter the order which is then sent to the kitchen automatically. They’ll even be able to process the payment on the spot as well. This also keeps customers happy as they’re served faster and more efficiently.

2. Better customer service

With more efficient order-taking and payment processing, your staff can focus directly on the needs of the customer. Plus, your managers can better take care of the restaurant floor, with no need for them to run back and forth to the kitchen.

Excellent customer service is vital for every restaurant, as it’s basically a guarantee of repeat patronage. After all, 60% of diners will frequent a restaurant where they’ve had a positive experience. This is no small statistic. In fact, a study by Bain and Company and Harvard Business School notes that increasing customer retention by 5% can improve profits by anywhere between 25 and 95%.

This also has a lot of value when creating a good first impression. You need to constantly maintain a quality dining experience for every customer, both new and old. All it takes is one off day to lose a repeat customer. In fact, 59% of customers will simply never visit a business again after one bad experience.

3. Menu Optimization

The right POS system can not only track which of your menu items are selling well—but more importantly—compare that to how profitable each menu item is. This helps you to better maintain your inventory, but it also gives you an idea of your restaurant’s best-selling dishes. With this data, it can help you calculate how profitable each of your dishes is, allowing you to make better engineer your menu.

4. Improved customer loyalty

Improved customer loyalty

A good way of keeping your returning customers happy is by building a loyalty program. With the right POS software, you can create a program that rewards points to your customers for their loyalty. Not only will this keep them coming back, but they may also refer you to more customers. A POS system also helps you to choose which items to include as a special bonus for your most loyal customers.

Image Source: Pexels

5. Reduction in human error

POS systems are easy to use and prevent mistakes that can happen with traditional pen and paper. This is a critical advantage in restaurants, where the life cycle of a single product passes through so many steps that require recording.

For example, when a server takes a customer’s order, the process doesn’t stop when the order is taken and tallied. It also needs to be tracked in your financial records, your inventory, and so on. At any point, mistakes can happen.

When you’re selling hundreds of drinks and meals a day, with multiple hand-offs of data to different people—even small errors can cascade into huge issues. POS systems can avoid this issue if they connect to all of your systems and trigger updates to all relevant records the moment an order is taken.

6. Inventory tracking

You’ll be able to view your inventory and orders effortlessly with the help of a POS system. You won't need to spend hours every day on tedious tasks like tracking down sales or checking inventory levels.

Cloud-based POS systems, such as Mosaic Solutions, can even automatically order inventory from suppliers once they fall below a certain par level.

7. Simple for processing payments

Simple for processing payments

With a POS system, you can easily take payments from customers who use credit cards or mobile apps to pay. You’ll also be able to keep track of your orders and payments from third-party delivery services like FoodPanda or Grabfood, and use that data to track how effective your delivery pipeline is.

Image Source: Mosaic Solutions

8. Greater flexibility

A cloud-based POS system allows you to track your data remotely in real-time. You can even make adjustments to your menu without even having to set foot in your restaurant.

As your restaurant scales to multiple locations, this becomes even more important. Manually tracking real-time data about inventory, sales trends, and finances across multiple sites is not just difficult—it’s impossible.

Eventually, you need that cloud-connected POS to unify all your data sources into an easily-understood system.

9. Identify booming trends

You’ll be able to monitor which of your menu items are popular and at which times of the day or the week certain things are trending. This can help you make decisions on operating hours, promos, staffing, and other information that benefits from trend data.

 Identify booming trends

One example of how this data is leveraged on a large scale is Starbucks. They use huge huge amounts of user data to select new products to introduce to markets or even where to open a new location. By hopping on the latest trends they can sell far more drinks than their competitors.

Image Source: Pexels

Modernize Your Restaurant with a Cloud-based POS

Older POS systems are still simple, offline programs that provide basic order taking and tracking. If you want to get the benefits of modern POS, you need to partner up with a good cloud-based POS provider which lets you take your POS operations to the cloud.

At Mosaic, we offer a robust, all-in-one cloud-based POS that has all the analytics, inventory, and purchasing systems you need to get all of the benefits we’ve laid out and more. With Mosaic embedded in the heart of your restaurant, you’ll be able to make intelligent, data-driven business decisions and improve every step of your front-of-house and back-of-house operations.

#SmartCities #StartupArticles



Brett Doyle is the Founder & CEO of Mosaic Solutions.

Mosaic Solutions is part of our Batch 5 Smart Cities Program.

To find out more about our Smart Cities Program, click here.

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