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Market Trends Point to Cloud POS as the Future

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Cloud POS Technology

If you are not using the cloud for your POS system and reporting, chances are you will be in the near future.

New research reported in Reforming Retail shows that cloud POS has achieved significant penetration within the U.S. restaurant market, exceeding 20% in all categories of restaurants except for cafeterias.

Market Penetration of Cloud POS by Category
QSR 25%
Café 25%
Food Trucks 95%
Cafeteria 15%
Fast Casual 25%
Full Service 35%

That means cloud-based POS has officially moved from early adopters into the mainstream.

Diffusion Of Innovation

There is a social science theory known as the Diffusion of Innovation.  Developed by E.M. Rogers, it is designed to show how an idea or product gains momentum.  In studying products over time, the theory explains how products go from being brand new to a novelty to an accepted product.   What Rogers found over the years was a consistent progression.  Innovators and trend setters trying new products accounted for about 2.5% of the market.  Early adopters came next, adding 13.5% market share.

Once the magic 15% number was hit, the product or service became mainstream and additional adoption happened rapidly.  What he termed “the early majority” added another 34%.  The “late majority” and “laggards” made up the rest of the market over time.  With every category of restaurant POS surpassing the 15% mark, you can expect adoption to grow dramatically over the next few years.  Our friends at Reforming Retail predict a 50% adoption rate across the restaurant category by 2021.

The “Tipping Point”

Examining current purchases supports those findings.  Analyzing system purchases over the past six months shows that more than 60% of the new systems purchased were cloud-based.  This represents the “tipping point” for the cloud.  It’s the first time that cloud systems surpassed sales of on-premise installed POS systems.

Cloud POS Benefits

Switching from traditional sales systems to a more intuitive and robust point-of-sale software system has significant advantages. Cloud POS Benefits are numerous:

  • Accuracy:  Inaccurate inventory, sales that go unrecorded, and human errors have been around as long as retailers have been doing business.  Scanning is more accurate than keying in numbers while automatically keeping track of inventory and minimizes mistakes.
  • Business Data: Tracking individual customers and ROI of individual products, such as ingredients in recipes for restaurants, can give you a way to measure the impact of cost changes for even the smallest items, or providing incentives for returning customers.
  • Inventory Management: One of the biggest struggles small business have, especially in the restaurant industry, is managing inventory and controlling waste. Cloud-based POS software allows for tighter inventory control and product analysis.
  • Speed: Slow checkout lines can cost you customers. A POS system can help your team check out customers more quickly, while reminding the cashier of any potential up-sale opportunities or customer rewards.
  • Access: Even with multiple locations, it gives owners and managers a way to access data across work units, track trends, and compare performance.

In addition, using tablet POS systems, connected to the cloud, allow for greater mobility.  While QSR restaurants can provide faster checkout, full-service restaurants can bring the device right to the table.

It can also minimize system downtime.  Even if your system has issues connecting to the cloud, you can use it in an offline mode and continue to manage transactions.  Once the connection is re-established, new data can be synced with no data loss.

Source

reformingretail.com/index.php/2018/08/28/have-we-reached-peak-legacy-pos/
www.pymnts.com/restaurant-technology/2018/qsr-payment-acceptance-technology-restech-index/
www.business.com/articles/9-benefits-of-making-the-switch-to-cloud-based-pos-software/
reformingretail.com/index.php/2016/11/01/the-simple-reason-brick-and-mortar-is-40-years-behind/
sphweb.bumc.bu.edu/otlt/MPH-Modules/SB/BehavioralChangeTheories/BehavioralChangeTheories4.html

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