Point-of-Sale Systems: The Final Frontier for Moving to the Cloud?

Ever since the early days of my small business consulting in Atlanta, the mention of a point-of-sale solution has been enough to give me a case of the hives. Over time, as I have gained additional experience as a CPA working with small businesses of every kind, as a product manager of mid-market systems that “integrated” with point-of-sale systems, and now as a consultant for Napa Valley wineries who rely on point-of sale-systems for their retail sales, it hasn’t gotten any better. I have generally found these systems to be the weakest link in the chain of business management solutions.

Point-of-sale systems generate retail sales thus making them critical for small business owners. It is imperative, then, that they function reliably and accurately. For developers of these solutions, the difficulty lies in designing a system that:

can be easily used by retails clerks who need to move quickly.
integrates with a myriad of specialized hardware (including cash drawers and barcode scanners).
has adequate accounting controls for capturing sales, cash receipts, taxes due, and inventory transactions.

And don’t forget reporting. Owners and their teams need flexible, comprehensive options for analyzing their sales, inventory, and customer data. In many cases, the focus by developers on ease of use (which, I am sure, drives sales) nearly always trumps a back-end focus on accounting needs, including period cut-offs, cash reconciliations, and sales returns. The result is at least one frustrated, exhausted accountant with 50 spreadsheets and an even more frustrated owner who can’t get timely insight into what is really happening with retail sales.

From my experience, there is no shortage of point-of-sale systems that are designed to solve one specific client problem or another. These POS developers are paid to create a solution for one client, and then as they are hired by other clients with slightly different requirements, they tack on new features one at a time. The resulting software is about as well-designed as the Winchester House with its 47 non-functioning fireplaces. These products tend to be built on older technology and are run by one or two developers who lack the funding to continue to develop and evolve their products.

And then there is QuickBooks POS solution from Intuit. Designed for the desktop, this solution is highly rated by Capterra, with more than 300,000 customers. While not perfect, this solution has the backing of Intuit. For a single retail location using QuickBooks Desktop, tight integration is one obvious benefit of this solution. Other benefits include:

Acceptance of multiple payment methods.
Scalable for growing businesses.
Inventory tracking.
Customer tracking and reward system management.
Access to other Intuit development teams who have advanced knowledge of other applications.

But what about franchisees or multi-store retail operations? How are they to manage their data across multiple desktop applications? The challenges for these multi-location organizations using QuickBooks POS on the desktop include:

1. Lack of centralized sales data. Data must be shared from location to location to get one centralized view of business results.

2. Inventory inaccuracies. Connectivity between remote locations may limit your ability to keep an accurate inventory balance across the organization.

3. Disconnected customer data. Keeping track of sales and reward status for a given customer across locations can be difficult using a desktop solution.

4. Unsecured data. Your sales, customer information, and payment card data is only as secure as the local computer that stores your transactions.

5. Limited infrastructure investment. Specialized hardware needed to capture sales consumes funds, leaving less for storage, networks, and additional processing capacity.

Thankfully, the cloud offers hope to multi-location retailers who are seeking to simplify their operation and improve organizational access to data. By working with the right hosting provider, QuickBooks POS can be installed on a remote server and then accessed remotely by individual stores. The benefits of this solution include:

1. Access to centralized data. Multiple authorized users can access and work on the hosted application, ensuring that all stores can run at the same time, while business owners and their teams can access real-time updated data and make data-driven decisions.

Centralized inventory management. Individual stores access a single database so that inventory balances are always in sync. Customer service improves when you can direct your customer to another location to find the item they want in the right size, or have it shipped between stores.
One view of the customer. You can understand your customer’s buying habits and preferences, manage their loyalty points, and more when their data resides in a centralized, hosted application.
Enhanced security. Reliable hosting providers are stringent about their security practices. Data encryption, strong password policies, data backup, and antivirus and firewall implementation are some of the standard security practices that cloud service providers deliver. In addition, some providers like Ace Cloud Hosting offer business continuity and disaster recovery features to ensure that QuickBooks POS hosting services for all your stores are operational even during a crisis.
Reduced dependency on hardware. Moving to the cloud helps organizations take advantage of powerful computing resources at a fixed monthly fee, without the large capital investment needed for equipment or the expense of IT professionals to support it.

As with any technology, the cloud solution you choose is only as good as the hosting provider who supports it. QuickBooks Point of Sale has some unique configuration requirements that require your hosting provider to have specialized expertise. Before you sign a contract, test your provider’s hosting standards and talk to other QuickBooks POS users as references. Compare the costs, reliability, and customer service that your provider delivers—will they be available to support you when your system goes down?