Basics of buying restaurant POS systems

By Jeremy Sacco

Tired of dealing with undecipherable, grease-stained order slips? Would you like to know for sure how much cheese to order next week - instead of just going by a hunch? Want to speed table turnover and help your servers better manage checks? Then you're ready to invest in a restaurant POS system.

A restaurant point of sale (POS) system can give you a new level of control over your restaurant operations, helping you increase efficiency, boost profits, get more insight into your finances, and fine-tune inventory management. And with POS systems that support tableside ordering and payment, you can also provide faster, more responsive service for your customers.

Switching from a traditional cash register and paper-based orders to a restaurant POS system does require an investment and some effort--but the return can really make it worth your time and effort. (Not sure how much you'll pay? To set your cost expectations, take a look at how much other BuyerZone users paid for POS systems.)

What do restaurant POS systems include?

In the most basic sense, a POS system combines the functions of a cash register and order slips. The typical restaurant POS station consists of a touch-screen or keyboard for entering orders, a cash drawer, and a receipt printer. Most restaurants have several such stations, with additional components depending on the type of restaurant.

Many restaurants choose to have additional printers in the food preparation area, eliminating the errors that can happen when hastily-scrawled orders are passed back to the kitchen. For quick-service restaurants, POS systems are practically a requirement for living up to their name: orders taken on terminals in the front are displayed on monitors in the kitchen, ready to be quickly assembled and delivered to the customer.

POS systems for table-service restaurants and fine dining are somewhat more complex. These systems need to be set up with your menu and seating plan so they can communicate orders to the kitchen and bar, track reservations and seating, and handle custom orders. Fine dining POS systems also typically include more stations: multiple server stations, a bar station, a hostess station, and printers in the kitchen. They also have more functionality, including the ability to create and store open checks, let servers send "fire" orders to the kitchen to start the next course, as well as track which server is responsible for which table.

Mobile POS systems for restaurants

One of the fastest growing-trneds in the POS industry is the rise of tableside ordering systems. These powerful POS systems let your servers take orders, customize orders, take payments, split checks, and in some cases even print receipts, all without leaving the customers. Some systems rely on dedicated handheld devices that are part of your purchase, others let you use various types of phones or other PDAs. Compatibility with iPhones (and the cheaper, non-phone iPod Touch), Android, and Windows Mobile devices are all common, but make sure you check with your vendor if you have a preference. To complete the payments, inexpensive magnetic strip readers (MSRs) that attach to common types of smartphones are essential.

Benefits of POS for restaurants

POS systems can greatly speed up the ordering process by automatically communicating orders to the kitchen and bar. The efficiency gains can be impressive: at a restaurant with 20 tables and an average check of $45, increasing turnover by one party per table would mean an extra $900 on a busy night. Additional savings come from reduced shrinkage: servers can't provide free food or drinks to friends without entering them in the system.

Handheld systems offer even more benefits. Keeping your servers on the floor means happier guests and faster service. Tableside check-out reduces fraud and gives customers peace of mind, as their credit cards never leave their sight.

In addition to the direct cost savings, restaurant POS systems offer detailed reports that can help you make more informed business decisions. Sales reports help you better predict volume and schedule employees appropriately. Inventory reports help you order the right ingredients week after week, cutting down on wastage. And order reports let you see which items are most popular, which items generate the most profit, and which items you should probably drop from your menu.

Which POS system should you buy?

Confused about which POS system you should buy? Not sure which features you need? Most vendors sell POS systems based on the type of business that you run. A fast food POS system is different from a fine-dining restaurant POS system; while fast food customers need to see a price screen, fine dining systems are mainly used by staff, not seen by customers at all.

Here are some other purchasing tips:

• When not to buy: If your restaurant doesn't yet have annual revenues of $700,000 to $900,000, it may be too early to purchase a POS system: consider using a cash register for the time being. A POS system is a significant initial investment that can increase the efficiency of your business and allow for quicker sales and better service, but if you're not making enough money to cover the initial cost, it might not be worth it.
• Know the features you need: POS systems come with all kinds of bells and whistles that might not apply to your specific restaurant, and you don't want to be stuck paying for extra features if you don't need them. purchase the wrong kind of POS. Find out more about types of restaurant POS systems before you start price shopping.
• Web-based or software-based? There are advantages and disadvantages to both. Web-based POS systems are rapidly becoming more popular, but they do usually carry a monthly fee for the service. However, all customer, sale, and inventory information will be backed up offsite in the case of theft or technical problems, and you can access it from anywhere. In comparison, software-based POS systems have no monthly fee, but they're more expensive initially and creating dependable backups can be more complicated. Decide what's best for your business.