Whether you sell online or in-store, returns are an inevitable cost in the retail industry. And they can be tricky – they can increase rapidly, aggressively cut into profit margins and cause logistics issues.
According to a recent study, the overall value of returned merchandise in the US during the past year was $309 billion, with online purchases accounting for $41 billion of that total. Now, the COVID-19 pandemic has complicated the issue of returns even more.
While it is an increasing problem, how retailers deal with returns can help differentiate them from competitors, reduce return costs, and even make them more profitable.
Along with higher return rates, the pandemic has exacerbated certain return challenges and created new ones altogether, for example:
Given the challenges associated with returning products to stores, retailers are having to offer extended return windows.
Increased health and safety policies require stores to set aside returned merchandise for 24 hours to reduce COVID-19 transmission. For some retailers, thorough steam cleaning has become a popular sanitation measure.
Retailers must find additional retail space and assign labour costs to their sanitation processes.
Retailers face higher consumer expectations when it comes to the efficiency of the return process and free online returns. However, the pandemic has caused reduced staffing across warehouses, delaying return processes for many stores.
Understaffed stores must find additional resources to restock returned merchandise back on the sales floor.
The overhead associated with receiving and repacking merchandise for resale along with the disposal of unsaleable merchandise is increasingly cutting into profit margins.
The good news is that retailers can take a number of steps to both reduce return rates and make the overall process more efficient and less costly.
How to Reduce the Cost of Returns
1. Clearly communicate your pre-purchasereturn policy
Establishing standard operating procedures for handling returns will make the process more efficient and less costly for your business.
Aclearly communicated return policy will enable you to treat each return the same so you can avoid treating requests on a case by case basis. Processing every return manually can be expensive and overwhelm your staff, ultimately preventing you from scaling your business.
While policies are going to vary depending on the industry and the type of retailer, every policy should include certain elements. To find out more about writing a return policy and the basics you should cover, click here.
Once you have written up your policy, you need to make sure that customers see it before they buy. This means including links to your policy in hard to miss places on your website or e-commerce site, and near checkout tills in your physical stores. Clearly outlining your return policy will help set the right expectations before purchase, reducing hours spent on customer service.
2. Accurate online product information
If you’re selling online, one way to reduce the likelihood of returns is by providing your customers with accurate product information. Depending on the type of merchandise that you sell, this could mean in-depth size guides, diagrams, or photos that clearly showcase the appearance of your products. Doing so will give your customers a better idea of what they are purchasing and they’ll end up more satisfied with their decision.
Make sure that the information you provide on a certain page pertains to that particular product, category, and brand. For example, you don’t want to provide clothing size guides on a footwear product page.
If you sell internationally, it’s suggested that you include links to international conversion charts or images of such charts on product pages as well as both metric and imperial measurements.
Retailers with physical stores may also want to provide the same product information in-store, especially if COVID-19 has impacted a customer’s ability to interact with products (e.g. if changing rooms are closed).
3. Customer reviews
Featuring customer reviews and ratings on your website can play an important role in reducing returns. In fact, online reviews carry a lot of weight during a consumer’s path to purchase. According to Google, 88% of shoppers say they trust online reviews as much as personal recommendations.
Giving shoppers access to helpful, relevant reviews can give them a better understanding of the products they are considering and can help set expectations about functionality, quality, and usability. And by learning about others’ experiences with the product, shoppers can easily discern if it is right for them.
Customer reviews are a way for merchants to have a finger on the pulse of their business as they provide valuable shopper feedback that can be used to proactively reduce returns. For instance, reviews provide important insight about customer preferences (e.g. what type of shopper buys certain products and how they use them) as well as product flaws. Store owners should constantly be analyzing and reading customer feedback to identify ways that they can improve product quality and services.
Some retailers even use reviews to make important purchasing decisions – e.g. the number of inventory items that should be bought, whether or not to continue selling certain products etc. If specific products have an overwhelming amount of negative reviews, it is time to review the products or work with the supplier.
4. Use technology to optimize the handling of returned items
Many traditional retailers aren’t using systems designed to handle online returns which have increased a lot due to the recent boost in online shopping.
For many, the issue is managing returns once they reach a retail store or shipping facility. Most traditional stores are still new to handling online returns which can include everything from where to put inventory back into stock to processing refunds for online sales in-store. And returns can get even more complicated with multi-location retailers selling on different online channels.
For example, processing returns manually will require a lot more staff hours than returns handled by a system that properly restocks returned products based on the order status. This is a flaw with many retail sales systems as the focus is often on selling as many items as possible, and less thought is put into how to handle costly back office processes such as returns which can really cut into profit margins when not managed effectively.
While some systems will utilize 3rd party apps to manage returns, a complete retail platform will include built-in return features such as:
Return Control Settings such as requiring receipts for returns, requiring return reasons that are tracked by users or a separate return screen to minimize the potential for employee theft.
User Access Controls for Returns such as restricting access to return functions.
In-Store Refunds for Online Sales at the physical location where returned products are actually inspected prior to refunds.
Omnichannel Stock Control that puts returned products back into available stock in all online sales channels and at the location where they are returned immediately once the return order is finalized.
Besides making the process smoother for shoppers, directing returns to physical stores helps retailers save on:
1) The cost of packing materials and staff time to pack orders securely.
2) The shipping fees of returns which are commonly expected by shoppers today with online returns yet doubles the shipping costs for merchants.
3) The cost of damages or lost packages during transit. Even if a merchant has insurance, there are administrative costs to making constant claims.
4) The cost of compensating unhappy customers with additional or future discounts when shipments or refunds are delayed.
5) The higher payment fees charged by processors for online refunds vs. PCI compliant in-person refunds with EMV PIN pads.
But more importantly, returns in-store are more likely to increase the chance of converting a potential refund into an exchange, or even better, a larger sale if the shopper buys more than the original order.
In this way, even though returns can be costly, they can also be a way for a retailer to really differentiate and highlight their customer service. After all, according to Metapack:
92% of customers who receive a good return experience make repeat purchases
So optimizing how you handle returns can be a chance to interact with customers, provide them with a great shopping experience, and capture their loyalty for the long-term.
6. Offer buy online, pickup in-store (BOPIS)
While there have been innovative strides taken in the retail industry to bridge the online and brick & mortar experience, even the best technology cannot replicate the in-store environment where customers can see and interact with products in person.
Oftentimes, returns are a result of customers not liking the product or the product not fitting properly. This can be reduced by providing a way for customers to touch or see the product in person before an order is complete. The ideal way to do this is with BOPIS which is also known as Click & Collect in some industries. For shoppers, it provides a convenient way for them to buy as well as return their purchases.
By offering a Buy Online Pickup In-store option, retailers provide their shoppers the convenience of online shopping with the interactive experience of purchasing in-store. And, of course, during the pandemic, this is a safer way for shoppers to buy yet still check their orders before taking them home.
Since the pandemic started this year, BOPIS orders are 275 percent higher than pre-COVID-19, even after stores reopened from lockdowns. Now that shoppers have been using store pickup for an extended period of time, studies show that consumers are unlikely to stop using BOPIS, even after the pandemic. This means that retailers need to find cost-effective ways to offer the service permanently with an omnichannel store system that can handle both sales and returns effectively based on the way people shop today.
Dealing with product returns is never fun, especially now with the complications brought on by COVID-19. However, when properly dealt with, retailers have the opportunity to minimize and even capitalize on returns. We hope our article outlined some of the ways to do so.
What are you doing to minimize returns in-store? Let us know in the comment section below.
Depending on your region or city, governments everywhere have been revising restrictions to help retailers re-open safely. Regardless of the local by-laws, it is important for retailers to be prepared to have and to manage mask policies for physical stores.
Over the past several weeks, cities and mainstream retailers have started implementing new universal mask policies. In this article, we’ll go over how retail owners should consider mask by-laws in-store, how to implement a mask policy even if it is not mandatory in your region, as well as some best practices on how to manage defiant shoppers.
Managing Mask By-Laws In-Store
If your store is located in an area where mask by-laws are in place, you’ll want to ensure that you take the necessary steps to implement new procedures pertaining to the by-law:
Print out a copy of the by-law from your municipality’s website and consider having a printed copy of the latest by-law available in the store to show to customers as required. Make sure you have read it carefully and are familiar with the requirements.
Develop a store mask policy in accordance with the by-law. Make sure to include necessary exemptions as stated by the government (individuals who are exempt such as those with health conditions or younger children, when masks can be temporarily removed etc.)
Be sure to train employees, particularly those who will be greeting and possibly confronting non-cooperative shoppers.
Display all necessary by-law signs (posters, signage on store-front etc.) outside and inside of every entrance to your store.
When Masks are Not Mandatory
Retailers have an obligation to provide a safe environment for both their staff and shoppers. In the absence of government orders, it is up to retailers to then determine how to provide a safe environment.
While masks are not known to protect the wearer from catching the virus, studies have shown that:
They do provide effective protection in minimizing the spread of the virus if the wearer is unknowingly sick (asymptomatic). Countries that have adopted universal masking policies (e.g. South Korea) have also had the best results in minimizing the spread of the virus.
More importantly, they have a positive psychological impact on shoppers that are scared. While some people do not believe in the effectiveness of masks, there is no doubt that mask policies make worried shoppers more confident to shop in-store.
Similarly, having a mask policy will make it easier for retailers to both hire and retain employees many of whom are worried about being exposed to many shoppers throughout the day.
As the virus continues to spread, many retailers have themselves announced mandates requiring all customers to wear masks in their stores. While some shoppers may find mask policies to be unfavourable, given the legal and ethical obligations of the situation, it would be in every retailer’s best interest to make masks mandatory. This will increasingly be easier to do as the largest retailers including Wal-mart, Best Buy, and Costco have all recently implemented universal mask policies.
Let’s take a look at some of the steps that retailers can take when implementing mandatory masking policies both in the absence of government orders and when government by-laws are in place.
1. Clearly communicate store mask policy
Given the number of different rules and regulations surrounding COVID-19 safety, it’s important to communicate your policy in a clear and respectable way to shoppers. This means having proper signage at all store entrances as well as inside the store and communicating the new policy via social media and digital channels (e.g. email and store website). It is important to announce your new policy in advance to make sure that shoppers are aware of the change and will be expecting to bring and wear a mask when they come to your store.
Signage should state your policy in an easy to understand manner such as “For the safety of our employees and shoppers, all customers entering store premises are required to wear a mask or face cover inside”. You may want to consider adding a list of exemptions to your signage as well (for ex: those with health conditions, hearing impairments etc.) Proper signage and marketing will make potential and returning customers more comfortable to shop at your store.
If you live in a region where universal masking policies are in place, you’ll want to ensure that all signage and marketing complies with rules of the by-law.
It is worth noting that some retailers have even taken denying access to all maskless shoppers, regardless of the by-law exemptions. In this example of a Fabricland store in Ottawa, the company policy goes beyond the requirements of local regulations and instead asks that anyone unable to wear a face covering to use their curbside pickup option. While stores are privately run businesses on private property and therefore may set their own store policies, it is important to consider both the potential legal and PR implications depending on how universal your mask policy is.
2. Station employees at store entrances
Create the role of “mask ambassador” and assign certain staff members to take on this role. Each “mask ambassador” should be stationed near an entrance of the store to remind customers of the new masking policies.
You may want to require these employees to wear specific clothing (e.g. a black t-shirt) to make it easier for shoppers to spot them. It’s important that these employees wear highly visible masks themselves and also receive special training to help make the process smoother for customers. Store owners may also want to consider hiring security staff to enforce mask usage.
3. Train store employees
Unfortunately there have been cases of angry shoppers using physical threats or even spitting on retail employees because of mask policies. This is why it is so important for staff to be trained on how to deal with different customer interactions including:
Those arriving without a mask
Exemptions pertaining to mask policies or by-laws (people with disabilities, hearing impairments, younger children etc.)
Customers wanting more information about the store policy or by-law
Aggressive, angry, or irritable customers
Fines related to by-laws
Shoppers asking for hand sanitizer or masks
In the past few weeks, social media has been full of videos capturing clashes between store employees and customers who refuse to wear masks. However, it’s not a retail employee’s job to manage any escalation with customers by themselves. Businesses have a legal and ethical responsibility to provide a safe working and shopping environment. If customers are abusive in their speech or actions, retailers have a right to refuse them. Click here for more examples of how to deal with customers who refuse to wear masks.
4. Consider giving masks away for free
If it is possible, offer to give or sell an affordable mask to unprepared shoppers to avoid turning away potential customers. Doing so is a great way to make it easy for customers to comply with store policy and/or government by-laws. It also helps showcase your support for your customers, employees, and community.
5. Provide alternative ways to shop
If customers have concerns about wearing a mask while shopping, providing them with alternative ways to shop online for delivery or contactless curbside pickup is a great way to continue to provide safety and convenience. Modern retail software platforms such as TAKU retail POS help retailers meet the new expectations of shoppers by allowing them to move their physical store online and sell from anywhere in the store, all in one flexible solution.
👇👇👇 Scroll to Download the PDF Version ofour COVID-19 Survival Tips for Retailers!!
For retailers dealing with the impact of COVID-19, shutting down may not be an immediate option, particularly if they are an essential business in their community. Over the past 10 days, we’ve spoken with many small businesses who are looking for ways to better manage the impact. Scroll down for tips on how you can minimize the impact of COVID-19:
Sell Online and Stay in Contact with your Customers
Offer Contact-less Options. It is expected that shopper behaviour will be significantly impacted by COVID-19 at least until there is a vaccine developed next year. This means that shoppers will have health and safety top-of-mind for the foreseeable future. Prepare now to make sure you are prepared before your competitors. Take this time to set up “Leave At My Door” delivery options or “pre-scheduled contactless curbside pickup” with orders placed online, by phone, fax or email. These are great options as you have confirmed pre-paid sales before you pack an order, you minimize staff and customer exposure and you avoid the cost of packaging products for shipment.
Make sure you have a Google My Businessprofile and keep your store hours up-to-date. For a limited time, Google will be showcasing any Posts made on merchant GMB profiles to people searching locally to ensure that local businesses get more coverage in their community. GMB Local Posts are a free (!!) and effective way to stand out in local searches and update shoppers about any new offers, delivery options, etc
Connect with local businesses to pool resources. Large retailers who rely on delivery such as Amazon can’t ship products in a timely manner anymore. There may be an opportunity for your local businesses to step up, particularly if you supply complementary products by offering local delivery together.
Keep an eye out for government Requests for Proposals if you’re in a position to re-tool your business to help address the challenge of COVID-19..
Look for ways to leverage the new “Stay-at-home Economy,” the new market created by demand from family, friends and children in self-isolation as a result of coronavirus. There are reports of sizable increases in at-home related categories including: personal fitness gear, home office equipment, indoor games, home and garden supplies, educational materials and books, hobbies, entertainment-related electronics, direct-to-consumer (DTC) friendly products suitable for mail-order subscriptions such as coffee, etc.
Keep an eye on your POS sales data to see if there are new trends to make sure you are stocking and promoting the products that shoppers want now vs. what they wanted to buy a few months ago.
Take advantage of marketing offers to get free ad credits to reduce the cost of staying in contact with customers. For example, Google has announced $340 million in Google Ads credits available to all SMBs with active accounts over the past year. Credit notifications will appear in your existing Google Ads accounts and can be used at any point until the end of 2020 across Google advertising platforms.
Be flexible and don’t be afraid to take action. A flexible and adaptable mindset is what will get you through this crisis. The situation is changing day-by-day which means you will need to make adjustments in your response. Even if you come up against resistance in the beginning, shoppers will eventually come around because people still need to buy and consume things.
Expect long-term changes in shopper behavior. While some pre-crisis shopper behavior will return, this pandemic will have long-term impact on general shopping behavior. Make sure you’re aware of those changes and adapt your business to match them. My parents are both over the age of 70 and have never ordered anything online in their lives. While they still prefer shopping in stores, needless to say, they are both avid online grocery shoppers now and will likely continue to buy more online in the future as they find it more convenient for re-stocking.
If sell B2B, find a way to pivot to target recession-resistant or essential companies as they will be the most likely to invest in new products or services.
In-Store Management Tips
1) Encourage Visible Hygiene Management in store by having all staff use gloves or wear masks. Have hand sanitizers readily available at the checkout area, near doors with handles, etc. If possible, have staff wipe baskets or trolley handles before passing them to shoppers.
2) Have clear signage to help customers understand the impact of COVID-19 on your store and what to expect for their shopping experience. Download these signs from CFIB to customize for your own business: Temporary Closure Notice, Safety Notice to Visitors
3) Pre-pack bulk goods such as fresh produce wherever possible to minimize touch. Stop offering samples unless they are pre-packaged.
4) Encourage Social Distance In Store by increasing the space in the checkout area between cashiers and where shoppers are waiting to pay. It’s as simple as adding tape on the floor to clearly show where shoppers need to stand as Walmart has done. Costco has famously used pallets to enforce social distance requirements in an orderly fashion.
5) Merchandise for fast retail as most shoppers will be shopping for necessity versus discovery. Keeping in mind the social distance required for safety, you will want to consider moving fast-moving goods in an easier to access location.
6) Put up transparent barriers wherever possible to minimize transmission while protecting staff.
7) Encourage “Contactless” Payments (e.g. tap or Apple Pay) and discourage the use of cash to protect your staff wherever possible. You may even want to increase your “contactless” limit with your merchant processor but remember that you are liable for any potential chargebacks on “contactless” payments.
8) If you are an essential business that is still sourcing, pay special attention to your supply chain. Anything sourced from areas dealing with a surge in COVID-19 cases will need alternatives in place. If necessary, even look at your suppliers’ suppliers for critical products.
9) Minimize Any Processes that Require Touch such as loyalty programs that require a tablet or credit card terminals that require optional prompts. Print out a QR code or signage for your web site and encourage users to sign up on their own phones.
10) Review Receipt Management Procedures to train staff to put receipts directly into shopping bags instead of handing them to customers or, even better, ask if they are ok to receive their receipts by email. Remember that privacy regulations require that you get positive customer consent to save their emails for future use so use an integrated email marketing tool to capture consent that will allow customers to unsubscribe themselves.
11) Sell In Store Gift Cards with an Incentive (e.g. extra $15 for every $100 gift card) to encourage shoppers to come back to the store when things are back to normal.
12) Offer Free Pens to shoppers who don’t have their own. It’s a cost-effective gift that discourages the use of public pens and helps customers remember you. Remember to minimize touch when offering them.
13) Communicate Proper Treatment Procedures when staff are sick. Make sure all managers and staff know what to do when they are sick. There is a lot of information out there – be sure to refer to the most credible medical sources in your country. In Canada, that will mean the public health authorities for your province or territory. In the US, the CDC is a reliable authority for guidance. For further details, you can also review the steps to prepare worksplaces for COVID-19 published by the WHO.
14) Minimize the Number of Shoppers In-Store to protect your own employees and make sure that shoppers are both comfortable and safe while in your store.
Owning the right POS system is essential to the success of any retail business. Today, a retail POS system can do much more than just handle payments and record sales – innovative POS technology now functions as a complete retail management system. These systems are known as cloud retail software.
In other words, a feature-rich retail POS system acts as a tool that enables you to both manage and grow your store.
But with so many different retail POS software in the market, how do you find the right one for your retail business?
Whether you’re looking for your first ever POS software or looking to upgrade to a new one, finding the right solution for your retail store doesn’t need to be difficult.
In this article, we’ve broken down the most important features to consider when choosing a retail POS system.
Point of sale features
Let’s begin by discussing all of the features needed in the sales portion of your retail POS. This covers all of the functionalities and features needed for a fast and easy checkout experience.
1) Easy to navigate sales screen
In order to ensure a fast checkout experience, it’s important to look for a POS system that is user friendly and designed for minimum clicks. Cashiers shouldn’t have to leave the sales screen in order to complete a transaction.
2) Fast barcode scanning
Your retail POS system should be designed for quick scanning speed while giving you the ability to quickly recall your last search. It’s also important that your POS software can handle multiple barcodes per SKU (an internal code, a shortcode, a vendor code(s), and a manufacturer code).
3) Advanced inventory search
Besides handling a high volume of inventory and transactions (read inventory features below), your retail POS software needs to have smart search functions. This will allow you and your employees to search for products by keyword, description, barcode or tag in case labels fall off or are not scannable.
4) Inventory management
Inventory is the most important asset you have as a retailer which is why it is necessary to track and keep an accurate count of all of your merchandise.
The inventory management component of your retail POS will help you replace tedious methods of inventory control resulting in time, money, and effort saved.
You’ll also want to make sure that your retail POSis completely mobile-friendly and can be run on any device. This will enable you to ring in sales anywhere in your store (e.g. on an tablet or mobile phone) which means a faster checkout experience for your shoppers.
Some systems offer the ability to store credit card details in the device until internet is back up but not only is it riskier to shopper payment details, you’re taking the chance of the stored payments not getting approved.
In today’s market, offline capability is not as useful as a smart POS platform that can be logged in from any device. When internet goes down, it’s as simple as securely logging in with a mobile device with data to continue ringing in sales.
7) User access rights
It is likely that you will have multiple people working in your business. Which means that your retail POS will need to be able to identify different users and give them tailored access to the system based on their role. User access rights also enable store owners to limit permissions on certain features in your POS (for ex: reports, etc.).
Look for a POS software that will grow with you as your retail operations scale. Your retail POS should have the following features: the ability to handle high transaction and inventory volume, international tax settings, multi-currency handling, unlimited stores, selling zones and multiple stock allocations.
These features will allow you to grow and scale with your POS software. Some cloud POS software have limits on the number of users and stores – meaning if you eventually outgrow your existing system, you will need to invest a considerable amount into upgrading or switching to another POS altogether
9) Customer relationship management (CRM)
The CRM component of your retail POS software stores shopper information and allows you to better manage your customer base. It can generate huge benefits for your store – including better customer relationships, sales reports that allow you to make better business decisions and more efficient operations. These benefits ultimately lead to more sales.
10) Bulk item import
For fast POS onboarding, you will want to select a retail POS that can import all of your inventory and customer details. Otherwise you will be stuck manually uploading your inventory – which is an extremely tedious and time consuming task.
11) Built-in training tools
Smart POS systems today will have self-service functions such as built-in chat support, online knowledge portals and even step-by-step guided products tours. Not only does this minimize your onboarding costs, it ensure that staff can quickly learn how to use the system at their own convenience.
12) Marketing integrations
Traditional point-of-sale systems are essential to retail operations management but modern cloud POS systems are data-driven which means you can now use your retail store data to drive digital marketing. A POS that has built-in marketing tools will allow you to streamline your marketing efforts so that you can sell more. For example, a POS that integrates to Google will help your retail business appear higher up in search results – resulting in more local foot traffic and sales.
TAKU Retail POS is designed for high traffic retailers looking to increase foot traffic to their physical stores. To keep the customers flowing into your store click below.
GDPR famously came into effect in 2018 but since then, CCPA in California and PIPEDA in Canada have both changed the privacy landscape further in North America. Now more than ever, retail owners have to be prepared to deal with customers who have questions about privacy. More specifically, questions regarding the collection of their personal information , what retailers intend to do with it, and how they will protect it from misuse/data breaches.
The best thing you can do right now is start on the process so that you protect your reputation with customers and be prepared when the US or Canadian government changes local privacy regulations again. After all, regulators and customers everywhere would rather see that you have a plan and that you’re working on improving rather than giving up or saying “it doesn’t apply to me.”
Rome wasn’t built in a day
For many small businesses, even knowing where the data of their customers and other people is stored is already hard. This is especially true nowadays with so much data being used and so many integrated systems. For most of us in North America, we’re just starting to consider how best to handle privacy in our day-to-day operations.
To make it easier, we’ve listed 8 basic steps for you below to help you get started on your privacy regulation journey within the context of PIPEDA, GDPR, and CCPA (download our GDPR checklists). These 8 steps are not necessarily enough for compliance with the different privacy regulations but they are a step in the right direction. Only you can decide the data risks you are willing to take with your business but hopefully this will help you clarify what those risks are.
1) Do a Privacy Audit for Personal Data
Download our checklists to make a detailed spreadsheet or summary of where you keep and collect personal data in your business.
2) Check if you currently handle Personal DataOutside of the Country
If you do already handle sensitive Canadian, American, or European personal data, we would recommend that you get further legal assistance as the different policies (PIPEDA, GDPR, and CCPA) already require that you comply. Here is a good comparative guide you can reference to understand the differences between each act.
3) What reason(s) do you have for collecting Personal Data?
Determine what lawful basis you have to collect personal data. Consent? Contract? Legal Obligation? Legitimate Interests?
4) Review existing data and delete any unwanted data
This is probably the most painful part of this exercise. If you have been patiently collecting customer or lead data for years, you will need to make the difficult decision to determine as to whether it is necessary for you to keep all of your existing data. In some instances, you may find that you have been collecting data for years that you never use. In others, it may be that you have some concerns about the source of a list of leads you received in the past. Whether you decide to keep the data or not, it is important that you are aware of what you have so that you know the risks.
5) Update company policies and agreements
6) Revise company processes and suppliers
Moving forward you should only gather personal data you need and make sure you have lawful grounds to process it.
Add and document consent wherever possible in your business processes. Consent has to be freely given, specific, informed and unambiguous (pre-ticked boxes aren’t allowed) on all of your forms (digital or paper). For email marketing, use reputable services such as MailChimp that are legally compliant so that subscribers are able to unsubscribe at any time.
7) Review all 3rd party processors and sign Data Processing Agreements (DPAs)
It’s also important to consider the privacy practices of your suppliers if you share any data with them that contains personal information. Be understanding that many North American businesses and most small businesses aren’t ready for updated privacy regulations but just make sure that your key partners are making efforts to improve how they handle privacy in their operations. If you’re sharing data with large processors such as Google Analytics, Facebook or MailChimp, you should sign the Data Processing Agreements (DPAs) or review the privacy settings they have for customers that share personal data with them. We’ve listed a few key processor DPAs below:
You cannot have privacy without security. While there’s no such thing as 100% security, every business should review who has access to company data and whether current security settings and back-ups are sufficient.
What we’re doing at TAKU Retail
So…you’re on the hunt for a new point of sale system for your retail business to improve your store operations. But what is the cost of a retail POS system today?
Maybe you’re unhappy with your current POS software and looking to upgrade to newer technology. Or, perhaps you’re still using pen and paper to manage your retail operations.
Whatever the case maybe, we’ve got you covered!
In this post, we’ll explain how much a typical POS system costs and the different factors that make up that cost. We’ll cover everything from software, hardware, and payment processing fees. But before we dive into how you can find the best and most cost-effective solution for your store, let’s get started with the two main types of POS software for retail on the market today.
Legacy vs. Cloud Software
The price of your POS system will depend heavily on the type of software you choose. Traditional, on-premise systems usually require an upfront investment of $4,000-$7,000. While you own continued access to use purchased licenses with this upfront payment, remember that you usually only have access to the version that you purchased. This means that you will need to pay some type of fee to get access to software upgrades or support services. While upgrades are not as important in the beginning, they will eventually be required to match the security upgrades of the operating system (e.g. Windows, etc.) or integrated tools.
In comparison, modern cloud-based (SaaS) software requires little upfront investment – instead you pay a monthly subscription fee. While this fee is ongoing, it’s important to remember that the monthly cost of cloud software is often less than on-premise software once you include the reduced cost of technical support (e.g. technicians on-site, support plans, upgrade fees) and you don’t need to worry about lost data as your information is always backed up to the cloud. The monthly cost of cloud POS software varies but to really figure out how much you can expect to pay, you’ll need to consider several factors such as the number of users, stores, features, the size of your business, etc. On average, it ranges from $80-$200 per station per month.
To learn more about on-premise vs cloud POS software, click here.
Next, you’ll need to consider your hardware costs. Remember – POS software and hardware are not universally compatible. So once you’ve decided on a software, you’ll need to have the right hardware in place to support your POS system.
With that being said, the amount you spend on your POS equipment depends on your industry needs and how you operate. Are you planning on ringing in sales with tablet devices? Are you issuing digital or printed receipts? Does your inventory volume require you to scan items at a fast pace?
A small store owner may only require one or two tablets to operate while a mid-sized retailer may need several monitors, receipt printers, and barcode scanners.
Payment Processing Fees
Arguably the most overlooked cost to a merchant are payment processing fees which can end up costing a lot in the long run as they are also an ongoing cost of business. This is why you should take your time to research your options.
For those who are not familiar with payment processing, every time a customer uses a credit or debit card, you will need to pay a fee to process that transaction. Payment processors such as Bambora or Global are the third-party service providers who process credit card transactions in exchange for a fee.
Some POS vendors act as their own card processors (Square, etc.) while others offer integrated payments. Depending on the size of your business, you can expect to pay at least 2.6% + a small transaction fee per transaction. Similar to your hardware, it’s best to go with a payment provider that integrates well with your POS system. Many POS companies offer special pricing if you opt to go for one of their preferred payment processors.
What to Consider Before Purchasing a POS System
Finding the right POS system for your retail business depends on your unique business needs. A POS software that works extremely well for one retail business (e.g a clothing store) may not work well for another (e.g. a high-traffic grocery store).
So, we’ve put together a checklist to help you find the right POS for your store. Here are some additional cost factors to consider when hunting for a new POS system:
1. Size of your retail operations: Most POS vendors will charge per location or store. Meaning the larger you get, the larger the cost to your business. Which is why it’s important to think about scalability when you make a decision about your POS.
Merchants that wish to scale their retail operations should opt for a POS system that is built for multi-location and high growth stores. This can help you save a significant amount of time and money down the road. Look out for the following features:
Unlimited stores, selling zones, and stock allocations
Multi-currency and multi-language features
The ability to handle high transaction and inventory volume
2. The quality and complexity of features: It makes sense that a more complete and useful system would cost a store owner more. While smaller retailers may not need to pay for robust features, mid-sized and larger merchants may have to.
Most POS systems come with tiered pricing plans. If you are looking for basic features (salesscreen, basic inventory etc.) then you can go for a lower-tiered plan. But if you require more advanced features (pricebooks, accounting integration, advanced inventory etc.) then you’ll have to go with a higher-tiered plan.
3. Open API access: If you are a growing business or already use other tools that you need to integrate with your POS, you will want to make sure that the POS system you’re looking at has an open API. Essentially, this is what allows merchants (with their own developers or marketing agency) to access backend data to integrate to or even enhance other applications they are already using. This is particularly important for a merchant looking to create or add innovative tools that improve their ability to compete. Examples of this include retailers looking to integrate their own custom e-commerce site, existing ERP system or even integrate to RFID devices to manage shrinkage.
4. Device Compatibility: As noted above, you need to consider compatibility with your existing devices when purchasing a POS. You don’t want to invest even more money and time in new hardware devices. This is more than simply whether your POS can run on certain devices, it includes whether the system you’re looking at can work with your existing credit card terminals, barcode scanners, etc.
5. Training and onboarding costs: Another important yet overlooked cost is the price of onboarding new POS technology. A POS solution that is inexpensive but difficult to use can cause your business a lot in the long run – this is especially true for high-traffic retailers that deal with long line-ups and peak periods. It is also important to consider if you are a retailer with a high turnover rate or seasonal peaks. If you are constantly training new staff members, it would be best to select a POS system with built-in training tools.
Remember – the proper POS software will not only help speed-up store operations, it will help you increase sales and can result in happier, more productive staff members.
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