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Updated by Helix Digi Labs on Mar 02, 2022
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What Is a Point-of-Sale System And How Does It Work?

A Point of Sale System (POS) can be defined as the place where a transaction occurs, where a customer pays for a particular good or service at a store. Traditionally, point of sale systems simply referred to the cash register at a store, with most of the work being done manually.

However, in the present day, we have what are known as mobile point of sale systems. Ranging from paid to free pos software, these are entirely digital and significantly reduce the amount of manual work that was once associated with the process.

Now that you know what a POS system is, you may be wondering…


How does a POS system work?

How does a POS system work?

A POS system consists of both hardware and software. However, whether or not you need to purchase both the hardware and software depends on your business setup. For example, if you run an online store, then you will only require the software, as long as it is compatible with the hardware you already own. On the other hand, if you run a cafe, then you may need to purchase certain hardware components, like a credit card reader or receipt printer. Some common hardware components are:

● Cash registers
● Monitor screens
● Barcode scanners


What are the common software components of a POS System?

Mobile POS systems carry out a large variety of functions. The common software features of these systems are:

● Inventory Management

As a business owner, you will easily be able to track your inventory without having to physically be present at your store. This therefore enables you to overlook your inventory in real-time.

● Data Entry

Instead of having to enter data manually for each and every transaction, the POS system will automatically fill in the sales order.

● Customer Marketing

By integrating with your store’s customer database and loyalty programs, a POS system can be used to assist customers during the checkout process, persuading them to join loyalty programs.

● Order History

POS systems can automatically deduct purchased items from the inventory and record the information in sales reports.

● Reports

Fundamental reports like marketing, sales, inventory and customers are generally included with a POS system.


What are the most popular POS systems?

Now that you’re all caught up on the technicality of POS systems, here are a few of the best options you could explore:


SalesPlay is a POS and stock control software that is compatible with tablets, smartphones, computers and POS terminals. It includes a variety of features and tools, along with interfaces that are easy to use. These features range from automated ordering and queue management to digital receipts and loyalty programs to name a few, with round the clock support at all times. The standard version is free to install, so it is the perfect choice not only for larger businesses, but also for small businesses that are just starting out.


Loyverse is a mobile POS system that can be used to sell products directly from Android and iOS tablets and smartphones. It can manage sales, employees and inventory efficiently, and can be used for businesses with both single and multiple stores.


Square is a POS that offers four different types of systems. These are the Square for Retail, Square for Restaurants, Square for Appointments and Standard Square systems. All four of these systems can easily accept different types of payments, take orders online, connect with Square hardware and integrate with an array of Square tools.


Imonggo is a web-based POS that targets small to medium sized businesses. It includes features like inventory management and reports. Since it is web-based, it can easily be accessed through the web browser on a laptop or PC, or can even be downloaded on the app store for an iPad.


TouchBistro is a restaurant management system that is built solely for restaurants. It can be used to increase sales, enhance customer experience and save time and money. A variety of add-on products for customer engagement and restaurant operations can be chosen to expand the central POS system.

It is therefore clear that a POS system can go a long way in terms of enhancing the operations of your business, making the process both easier and more efficient.

Now that you’re all caught up on the technicality of POS systems, here are a few of the best options you could explore: