To the point

Regardless of your business model,there’s an ideal point of sale (POS)system to help you save time, managestaff, and market specials and coupons,as well as ensure safe transactionsfor your business and customers.Whether you’re acquiring your firstPOS, expanding your business or simplyshopping for an upgrade, the fi rststep is assessing your business model.“Write down your requirements, makea spreadsheet and request a formalproposal,” suggests Alan Hayman,founder of Hayman Consulting Group,a Potomac, Maryland-based firm thatspecializes in hospitality technologyconsulting. “You want to ensure thatpotential vendors are responding to aspecific set of requirements.”

As Hayman points out, your transactiontypes will determine what POS softwareyou’ll need to best serve customers.Common types include: counter transactions(pay first or pay after), server orprecheck transactions, bar tabs, phonein,delivery, drive-thru, curbside, handheld/tablesideordering, online orderingand catering. “While you may not utilizeall of these options, you should considerwhat you might want to offer within thenext two years,” Hayman explains.

Menus and Specials

Your menu, specials and coupons arealso important considerations. Thepizza business—prone to add-ons, splitorders, special deals, coupons and deliveryto name a few, presents requirementsyour POS vendor should be familiar with,so ask for features specifically designedfor pizzerias. For operators, the softwaremust work well with the nature of thebusiness and can even help manage staff.“Pizza menus can be very challenging forPOS systems that have not been designedfor them,” Hayman says. “You should askyour vendor to demo your most complicatedtransactions to make sure the softwareis a good fit.”

Danielle Burger, owner of Wally’sPizza & Subs (ilovewallyspizza.com)in Carson City, Nevada, experiencesdaily frustrations with her POS, inheritedfrom her family’s nonrestaurantbusiness. In addition to having troublesplitting orders, the system doesn’torganize toppings alphabetically, andsetting up coupon buttons can be timeconsuming.“I would have chosen a morepizza-centric system,” she says. “We needa product that is simple to use at the frontand back of the house, easily does halforders, shows product price and makesmodifying an item simple.”

On the other hand, Doug Brandt,owner of Pie Hole Pizza Joint (pieholepizzajoint.com) in Chicago, is an exampleof an operator who has found a systemthat provides exactly what his mostlyby-the-slice business needs for day-todayoperations. He even volunteers todo beta testing for his provider. “WhenI bought Pie Hole, the previous ownershad no POS—just a legal pad and a bankbag as a register system,” he says. “OurPOS is on 24/7, and we use it for everything.We purchased a premium packagethat includes online ordering, scheduling,caller ID and a time clock; it can’t bebeat.” When it comes to programmingcoupon buttons, Hayman suggests youprovide your vendor with a list. “Combodiscounts and buy-one-get-one-free dealscan be more difficult than percentage-offor dollar-off deals,” he says. “Make sureyou present all of your deal offers to yourvendor before making a purchase.”

Online Ease

In the digital age, online ordering is quicklybecoming a must for operators, and thegaps between online ordering companies,your website and POS providers are growingsmaller. For immediate, user-friendlyonline transactions, many POS servicesare integrated with third-party online ordering
providers. This prevents employeesfrom having to manually enter onlinesales—perhaps delivered by fax or email—as they would enter phone and in-storeorders. “The point of distinction is wherean online order goes once it’s made,” saysBarry Brownhill, president of Arrow POS+in Carmel, Indiana. “For companies thatare integrated, the sales automaticallycome into the POS as an active order.”

While integrated online ordering reducesa step, it often adds a monthly bill.However, some POS providers offer amore integrated solution with an in-houseonline ordering provider; this can resultin savings if a large portion of your salescome from online orders. “Many providerscharge you a monthly fee, then keep3% of the credit card transactions,” saysMario Molaro, vice president of BankCardPOS, in Glen Ellyn, Illinois. “When you’repaying your credit card processor up to2% per order, you’re losing 5% of a transactionafter you pay the host.”

In additionto streamlining online ordering, thisintegrationoften helps ensure accurate websitemenu alterations. Whenever a pricechange occurs or you add or remove anitem, the website and online sale will automaticallyreflect the correct price. “Thisway, the operator doesn’t have to call acustomer and explain the change andwhy it hasn’t been updated online,” Molarosays. “If a customer places an order,then gets a call 10 minutes later saying thepizzeria doesn’t offer something anymore,the sale is usually cancelled.”

Secure Transactions

Your pizzeria has an obligation for maintainingsecurity when it comes to POSrecords and credit card information,and an unsecured POS system can meanlong-term consequences for operatorsand customers. The Trustwave GlobalSecurity Report 2011 found that themajority of POS breaches in 2010 wereaimed at the foodservice industry. A recentstudy by Visa showed that 85% ofpayment data breaches occur with smallmerchants. For example, last April, aMountain Mike’s Pizza (mountainmikes.com) location in Martell, California, discoveredits POS had been hacked andused in a credit card theft ring that leftmany of the store’s customers (from aseven-month span) vulnerable to identitytheft. According to James Cummings, directorof project management and compliancefor Sage Payment Solutions, thePayment Card Industry (PCI) SecurityStandards Council requires merchants touse PCI-compliant software; merchantswho do not comply could face fines of upto $250,000 for security breaches. Compliancelevels, which vary depending ona business’ volume of transactions, mustbe checked annually to maintain thiscertification. “There’s a need to ensurethat security-minded implementationoccurs,” he explains. “If the POS collects,transmits, processes or stores credit carddata, merchants should confirm thattheir system is certified. The PCI standardsensure that everyone touchingcredit card information meets a minimumdefined security to protect data.”

While purchasing a PCI-compliantsystem can keep hackers from your customers’personal information, outsidersmay not pose the biggest threat to merchants.“A lot of money has been spenttrying to keep the bad guys out,” saysBrian Anderson, chief marketing officerof BeyondTrust, in Carlsbad, California.“What we’ve found, and what researchsays, is that the biggest impact on securitybreaches comes from the insider—goodpeople can do bad things, accidentally oron purpose.”

Jonathan Jesse, BeyondTrust’s vicepresident of program management, recommendsoperators look into softwarethat can monitor user activity and implementan access-control policy. “Don’tsimply grant root access; delegate thisprivilege when needed—such as whenfixing a changed ticket,” he says. “Anycustomer information that is privateneeds to be controlled effectively, eitherthrough encryption, access control orprivileged-activity reconciliation.”

Providing a clear concept for yourPOS provider, and conducting the extensiveresearch, can make for longtermsatisfaction and even savingsfor your pizzeria—and the technologyis rapidly evolving. “One of the latestopportunities is the ability to add integratedmarketing solutions to certainPOS systems,” Hayman says. “Closedloopmarketing can track results thoughPOS and can incorporate email, loyalty,reservations and social media. You caneven use your POS to track the orderhistory of individual customers.”However, more important than beingan early adopter is understandingyour near-future business goals. Thatwas the case for the owners of MackenzieRiver Pizza (mackenzieriverpizza.com), a14-unit chain based in Whitefish, Montana,who realized last year that the timeto change POS systems had arrived due totheir evolving vision for the brand. “Weneeded to have something more consistentas we grew,” says Erica Coffman, directorof marketing. “For years, we’d been apizzeria with a delivery concept, but we’vemoved more into the family-casual market.We needed a product that could helplead us in the right direction.”

Andrew Abernathy is PMQ’s associate editor.