When Tony Avenia, owner of B&G Wine and B&G Gourmet, two stores in Hillsdale, NY, first went shopping for a point-of-sale (POS) system for his wine and liquor shop five years ago, he was looking for all the usual inventory-tracking and customer-management capabilities. ‘I wanted a good system for free-standing, self-contained small businesses that allowed for future growth and that helped us provide customer service,’ said Avenia.
But he was also looking for a system that looked good. B&G Wine had, after all, just undergone a million-dollar renovation and now sported wood floors, granite countertops and custom-built racks. The old cash register ‘ ‘which printed out a little two-inch-wide tape as the receipt’ ‘ and the free-standing credit card processing unit that the store had been using before had to go.
Avenia went with a system from AccuPOS. (See Buyer’s Guide for systems information.) ‘I love that our monitor is a touchscreen, that all the credit card processing is integrated, that there is a customer display pole and that the receipts have all the information on them ‘ names of the products, any discounting, even a custom message from us,’ he said. ‘We are projecting a much more professional image to our customers.’
Choices for Smaller Retailers
Once, not all that long ago, small- and mid-sized retailers could only look in wonder at the million-dollar computer systems used by the mega-store, large chain retailers. Since then, technology has advanced even as prices have dropped dramatically. These days, even the smallest retail operations find they have many POS options from which to choose.
‘Fifteen years ago, it was very difficult to find a good system. What was out there was in its infancy stage. It promised you the world, of course, but was, in fact, very buggy,’ said James Dion, president of Dionco, Inc., a Chicago-based retail and retail-technology consulting firm (www.dionco.com). ‘Over the last five years, however, the quality of the systems available has grown dramatically. To be frank, the needs-analysis portion of my business [where he worked with retailers to find them good computer systems] has dried up. Now, I tell people, ‘I’m not sure you need me. It’s not the Wild West out there anymore.’’
When it comes to choosing a computer system, it’s important to know what your specific needs are, said Scott Pactor, owner of Appellation, a New York City boutique wine shop specializing in organic and biodynamic wines. ‘It really depends on how you want to position yourself with customers,’ he said. ‘Some retailers need a system that can handle changing prices and doing promotions. Others do a lot of deliveries and shipping and need a system with customer purchase history capabilities.’
When Pactor opened his shop three years ago, he went with a system specifically designed for beverage alcohol retailers from Innovative Computer Solutions (ICS). ‘It’s detail-oriented,’ he said, ‘and its greatest function is its purchase history functions.’ Appellation also uses the system’s ability to automatically upload the store’s inventory information on a daily basis to the store’s website, which is run by a different system.
Another capability of Appellation’s system proved valuable about five months ago. Appellation’s server crashed and was down for almost a week. Because the system’s registers had ICS’s Robust Register capability, they automatically went into ‘stand-alone mode.’ In other words, they still worked; they were able to continue processing transactions. (However, without the server, the registers could not be used to look up customer information or real-time inventory information.) Once the server’s connection was back up, the store’s registers automatically reconnected to the server, sending all the sales information they had recorded to it, all the while continuing to be able to process transactions.
As Dion said, although there are many strong systems out there from which to choose, retailers still need to be careful in order to pick a quality system that is right for them.
Tom Williams, co-owner, with his son, of Glendale Package Store, a 6,000-square-foot, two-register store in Waltham, MA, is very happy with his current system, LiquorPOS from Merchant Software. ‘It is a fantastic tool and we are using it to its fullest,’ he said.
But the system he used before installing LiquorPOS seven years ago was a different story. ‘That was in 1985. In those days, the system was designed for you,’ said Williams. ‘I shopped around and purchased one. It was the worst eight months of my life. I went all those months without being able to generate a single sales report.’
Williams said he learned a valuable lesson from that experience. ‘I vowed that I would research the products and, more importantly, the companies carefully. I did ‘ and choosing LiquorPOS was probably the best business decision I ever made,’ he said.
Seek Out Referrals
He highly recommended talking to retailers who are using the systems you are considering. Consultant Dion concurred. ‘Call another store just like yours that’s in a different area and ask them what they use, how they like it, and perhaps most importantly, how’s the company’s service.’
Realize, too, he noted, that if you buy a packaged software product from a big company, such as Microsoft, the company whose customer service you’ll really want to investigate is the value-added reseller (VAR) you bought it from. Dion stressed, ‘Say you pay $1,300 for POS software. Be prepared to spend $10,000 to learn how to use it.’ The VAR will install your system and provide training. ‘Like anything else, there are very good VARs and there are very questionable VARs. Get references and contact those references and ask questions. Do your due diligence,’ said Dion.
Why the big investment in education, especially when many systems tout themselves as being user-friendly? ‘A lot of retailers won’t pay to learn their systems. They’ll say, ‘It’s intuitive.’ Baloney,’ Dion said. ‘Most of us only use about 2% of what Word and Excel can do. The same is true of POS systems. They require learning, to know how to run the proper reports, for example. They don’t do it magically. You have to learn how to work with them.’
Avenia was able to install his AccuPOS system on his own with minimal assistance from the company. He bought the entire system, both the hardware and software, from AccuPOS, which shipped it to him overnight. ‘I was impressed by how much of the installation we were able to do on our own. We basically did it all ourselves, with, maybe, a question or two, a call or two, to the company,’ he said. And he has had very few problems since. Still, he appreciates the customer service he gets from the company when he needs it. He plans to install an AccuPOS system in his gourmet food store as well.
Glendale’s Williams is glad he went with a system dedicated specifically to beverage alcohol retailing, noting that he believes larger companies without specific beverage alcohol focus do not provide proper support.
Dion agreed. ‘When you’re buying a new system or upgrading your existing one, that is a great opportunity to look at your own business processes,’ he said. ‘These specialized companies, especially if their systems are being used by a number of other liquor or wine stores, learn from their customers every year as they upgrade and update their system. They can really know the issues of your business.’
For a similar reason, Dion suggested staying away from POS systems brought out by companies who really specialize in other forms of software, such as accounting packages. ‘Don’t buy a POS system that’s just been bolted onto something else,’ he said.
What is good, though, say retailers, are POS systems that were written to easily integrate with popular accounting software packages. Both B&G’s Avenia, using AccuPOS, and Glendale’s Williams, using LiquorPOS, have set up their POS systems to work with accounting packages. Both use QuickBooks. ‘We interfaced with QuickBooks about two years ago and that’s been terrific,’ said Williams.
Don’t Stint on Hardware
Dion had other tips. One common mistake he sees among retailers is to buy cheap hardware. ‘Your cash register is where the money comes into your company; it’s where the customer is standing with his wallet open,’ he said. ‘Don’t buy a $400 PC for that spot. Buy a $1,200 retail-hardened machine. That register is going to have coffee spilled on it. It might get knocked over. Retail-hardened hardware is built better and will last longer.’
As for software, ‘Stay away from beta anything,’ he said. ‘As a matter of fact, never get a new version of software as soon as it comes out. Wait six months. Don’t fall out of the update cycle ‘ keep your system current ‘ but wait six months, so that any problems get worked out before you start using it.’
Retailers do suggest, however, buying systems that have capabilities you aren’t using now but might in the future, whether they come as part of the basic POS product or are separate add-on products that you can buy down the road. Appellation’s Pactor, for example, has been using an Innovative Computer Solutions system for three years and is currently considering adding the company’s newest credit card processing interface, IP Charge from VeriFone.
Dion is all for integrated credit card processing. He once had a liquor store client who went from stand-alone, credit card processing, via phone lines, which took 30 to 40 seconds to process a transaction, to using a POS- integrated, DSL credit card processing capability, which took less than three seconds to process a transaction. ‘Thirty seconds may not sound like much,’ he said, ‘but when it’s Christmas and people are standing 14 to 18 deep in line, believe me, it is.’
Avenia didn’t use the customer-history capabilities that came with his system at first but now does. And he is considering adding AccuPOS’s inventory management product to his system. ‘A good majority of the capabilities we’ve added over the years were already in the system,’ he said. ‘And when we do want to add something, like the inventory management, it’s a very easy transition. That’s what I was looking for: a POS system that could accommodate our growth.’
Next: POS and Computer Systems Buyer’s Guide