Analyzing the Point of Sale (POS) System

The assignment provides a comprehensive analysis of the Point of Sale (POS) system, highlighting its advantages and disadvantages. It discusses how POS systems have revolutionized businesses by automating transactions, improving inventory management, and providing real-time data for informed decision-making. The report also acknowledges potential security concerns associated with POS systems and recommends best practices to mitigate these risks.

EFFECT OF TECHNOLOGY ON BUSINESSES
Executive Summary
The Point of Sale transactions that are cashless and machines in the experience of
shopping today, form an integral part. The machines of POS provide the opportunity for the
customer to swipe their cards of debit or credit, key in the total money needed for the payment
and then electronically make the payment in just a few seconds after sending the transaction to
be authorized. On the other hand, the number of the account may be typed and after its approved,
the client is able to receive and then sign the provided receipt. In summary, the machines of the
POS enable organizations or businesses to a great extent save a lot in terms of time and cost and
also enables the business transactions to become more efficient.

Table of Contents
Introduction...............................................................................................................................................3
Benefits and limitations of the POS..........................................................................................................3
The POS Competitive Advantage.............................................................................................................4
Centralized database Advantage..............................................................................................................5
POS Making of Decisions..........................................................................................................................6
Telecommunication...................................................................................................................................6
Risks that come with the use of POS........................................................................................................6
Conclusion..................................................................................................................................................7
References..................................................................................................................................................8

Introduction
The POS (Point of Sale) systems in small businesses are mainly just registers of cash
which are sophisticated. In 1970s, cash registers operated through a computer tended to become
very popular and then started to give features such as the technology of the client-server,
communications of peer-to-peer access that was remote and backups. Nowadays, the POS
systems have standardized in the industry of hospitality and many businesses of retail level have
customized the same. The systems of POS can be connected with the account of the merchant
and they enable easy and quick acceptance of the transactions of the credit cards by the
business. Since the systems of the POS have the ability to immediately process transactions as
they happen, the business is able to enjoy increased efficiency of the employee, better and more
accurate keeping of records. The systems of POS are specific to the industries and it’s possible to
customize them.
Benefits and limitations of the POS
Many businesses use the system of POS for various reasons which include efficiency.
The system of POS that is right POS system may enable to get rid of any errors caused by human
that may occur during the processing of transactions carried out by the employees. The system of
POS stores information in a single place and well organized hence reducing the errors which
leads to the processing that is fast and efficient. (Reeder, K.R., 2014)
Another benefit is simplifying information recording. This happens because the system of
POS standardizes the transactions format. The storage of transactions is done on a computer that
is central and when required they can be printed reducing any wastage that may occur.
Also, a POS system may be designed in such a way that it records each and every detail
regarding a transaction, that is; the employee who carried out the task, total amount of the sales,
services or items purchased, date and time of the transaction. This can be very useful when it
comes to decision making.
The system of POS also helps in saving money to a great extent. Better track keeping of
the inventory, making decisions that are more informed and saving time of the employees are
very good ways that help in saving money and cutting the overall cost.

Apart from the benefits offered by the POS system, it also has some limitations which
include the danger of security concerns. Customers are likely to divulge their PINs while using
their debit cards to the other customers. Various systems try to take measures to of hiding
keypads but they have not done it successfully. Furthermore, the system based on the web also is
exposed to risks of security and privacy associated with internet-based businesses.
Another problem that comes with the use of POS is the regular updates required by the
system for newer versions either from the company of the software or the manufacturer.
Additionally, one needs to incur the cost of updating the hardware as well that comes along with
the cost and complications of the updates of the system. These costs may have been invested in
something productive for the business. (Rockoff, T.E. & Groves, M., 2015)
The POS that is web based used comes with additional costs whereby one is required to
pay for the access of the internet on the registers together with a fee to the provider that comes
monthly.
The POS Competitive Advantage
A POS that is integrated is able to track and manage inventory on top of offering storage
tools and management of the data of the customer that if done manually would have been time
consuming and not effective due to some errors and omissions. Small business such as the
Greenhouse of the Four Seasons, offering them the level of information detailed in that manner
may help them to transform their small business. This in return would help them to generate
campaigns that are personalized, begin programs or loyalty and expect more revenue. The
Garden center was able to produce a report of a customer regarding their history of purchase that
is detailed and hence the business develops the ability to focus and put more effort in the targeted
products which makes the business to become effective in terms of marketing and in efforts of
outreaching. The data that is trending in the merchandise and sales may be used in making
decisions that are smart regarding the inventory. With the provision of such reports regarding the
merchandise and customers, the business is able to avoid over ordering of products which saves
some good money the budget of the inventory. (Beach, D., 2011)

Centralized database Advantage
Use of a centralized database helps the retailers to get POS stations at a level of property
at every location that is connected to the central server. The connected systems offer reports of
real time to the corporate offices on the habits of buying of the customers, management of the
inventory and labor, costs of the company and orders of products that are online. Customers are
also offered with valuable insight of purchasing and information on preference which could be
essential in enhancing the experience of the shopper through programs of loyalty that are
tailored. Through that, the business is able to begin the foundation of the data needed to compete
in future.
Customers are able to shop in real time. New techniques of processing that are in-
memory makes it possible to analyze fast data of huge volumes and roll-ups that are sub-second
roll-ups. This enables the marketing, merchandising and the managers of operations to dice and
slice billions of records of transactions. Views that are prebuilt and optimized for the mobile and
web users makes it possible for an organization to analyze the data that is centralized in an easy
manner when required. (Benco, D. et al., 2010)
Another benefit is that it becomes easy to maintain compliance. A system that is
centralized enables retailers to facilitate easy compliance with regulations of the tax and the set
standards globally in all locations. It eliminates the doubts as to which system is up to date and
also the system that has complied with the security standards of the Data of PCI among other
regulations. (Bemmel, V. and Mian, S., 2009)
In a centralized database, the costs of maintenance and the hardware may be reduced
since it is possible to connect a large number of peripherals very easily and fast. This eliminates
the need for locking oneself into contracts that are specific or brands in case new functions are
required. The use of a single platform that is compatible with several systems of operation and
environments of the server enables retailers in making changes in the future for accommodating
the demands of the consumers for various channels of the retail and several payments types.
Whichever product a customer may currently demand for or demand it in the future becomes
possible to accommodate. And finally, the time a retailer gets ready in deploying payments that

are mobile, each and every location can easily carry that out through the configuration that is
central and distribution software which is automated. (Tillman, M., 2013)
POS Making of Decisions
The POS systems may be designed in such a way that they keep record of each and every
detail concerning a transaction which include the person who carried out the transaction, the
amount in total of the sales performed, the number or the services and products that were
purchased and finally the date and time at which the transaction was carried out. All these
operations are carried out accurately, timely and in detail. (Phillips, H. & Bradshaw, R., 2013)
The information is vital when it comes in decision making of the business. One is able to
determine when a product is able to yield more in a year, the products that are adding or
generating more revenue or income for the business, the employees that are providing less or
more sales and whether the special promotions offered are giving the effect that is
desired. Management of the inventory becomes more strategic and simple since the decisions
made are based on the information that is real time. Many POS software provide the function of
reporting that enables the owner of the business to come up with a sales list by category, by
employee or by the date. All these specific details of reports offered by the POS system help in
better decision making of a business. (Freeny Jr, C.C., 2015)
Telecommunication
The technology suitable for this POS would be the metropolitan area network since it
covers a large geographical area and enables sharing of resources by several computers. The
wireless technology would also go hand in hand with the MAN as it best since its fast and easy
and mobile too. The technologies to be used could be the WCDMA, GPRS and EDGE since they
are fast and strong enough to support the system of the POS. (Labrou, Y. & Agre, 2010)
Risks that come with the use of POS
Attackers have tried to execute code that is arbitrary in the process browser of the user.
For this to happen, the user is required to access a website or open the sent file by a hacker.
Another tactic used by intrude the privacy and security of the customer is through
phishing. This can be done by the use of a single email of phishing or just the whole campaign

whereby, a user is triggered to open an attachment or clicking a link. The attacks of phishing are
spread widely and are affecting all industries which can be done through various ways such as:
 Tricking users to give out their credentials such as the passwords and usernames of the
accounts that are online.
 Use of a page that is spoofed which redirects users through an iframe that is malicious
that installs a virus on the machine of the user.
Third-party vendors of the POS too have been a target in the campaigns of phishing whereby
credentials that are stolen are used in gaining access to the network of the provider and networks
of organizations of retail that are larger. (Goeller, M. and Lilly, C., 2012)
Attackers have also advanced through the use of software techniques that are advanced to
evade being detected by the software of antivirus. The attackers place devices that read cards
referred to as skimmers on the point of sale devices. The skimmers then copy the card numbers
when users insert them. The attackers also attach cameras that are hidden together with the
skimmers in order to record the numbers of the PIN when the users are typing them.
Various practices may be implemented to protect the business such as the use of a version of
a software that is most recent, limiting the access of the employee for the PCs that are general
purpose, choosing devices of the POS that are approved by the security council of standards of
the PCI, adoption of tokenization, encryption that is end-to-end, and chip and pin, making sure
that the default password that comes with the POS are removed so that hackers may not use them
after acquiring them from the manufacturer. (Hills, R.R. and Nichols, H.R., 2010)
Conclusion
Based on the report detailed above, its clear that the use of the POS system has brought so many
advantages to the business sector which include eliminating manual processing of transactions
and report processing and managing and monitoring of the inventory. This has saved a lot of
time and money for the businesses which may be used for further investments for the company
hence increasing the profits. It has also enhanced better decision making for the businesses as the
managers are provided with clear or real time reports of products which enable them to make
prices for products that are real time. This has in return enabled businesses to compete with other

businesses effectively enabling them to gain a lot. However, the POS experiences some short
comings which hopefully will be dealt with in good time.
References
Beach, D., Braden, D., George, P.L. and Meredith, M., Sapient Solutions LLC, 2011. Computer
based system for monitoring and processing data collected at the point of sale of goods and
services. U.S. Patent 5,924,077.
Bemmel, V. and Mian, S., YOU Technology Inc, 2009. Method and system for providing
biometric authentication at a point-of-sale via a mobile device. U.S. Patent 7,512,567.
Benco, D., Mahajan, S., Sheen, B. and True, S., Lucent Technologies Inc, 2010. Processing
merchant point-of-sale transactions using a mobile subscriber device. U.S. Patent Application
11/280,550.
Freeny Jr, C.C., FPDC Inc, 2015. System for reproducing information in material objects at a
point of sale location. U.S. Patent 4,528,643.
Goeller, M. and Lilly, C., Visa International Service Association, 2012. Point of sale check
service. U.S. Patent Application 09/810,945.
Hills, R.R. and Nichols, H.R., ChequeMark Patent Inc, 2010. Check writing point of sale system.
U.S. Patent 6,164,528.
Labrou, Y. and Agre, J.R., Fujitsu Ltd, 2010. Wireless computer wallet for physical point of sale
(POS) transactions. U.S. Patent 7,784,684.
Phillips, H. and Bradshaw, R., 2013. How customers actually shop: customer interaction with the
point of sale. Market Research Society. Journal., 35(1).
Reeder, K.R., Lucent Technologies Inc, 2014. Point of sale method and system. U.S. Patent
6,014,636.
Rockoff, T.E. and Groves, M., 2015. Design of an Internet-based system for remote Dutch
auctions. Internet Research, 5(4).
Tillman, M., 2013. Method and system for hosting centralized online point-of-sale activities for
a plurality of distributed customers and vendors. U.S. Patent Application 10/386,886.