Aussie resellers cash in as POS goes cloud and mobile

That clunky old cash register just doesn’t cut it any more. Retailers have been hit by an avalanche of technology, driven by the trends in mobile, analytics, CRM and the ‘internet of things’.

Whether using iPads as tills, changing prices with RFID chips or scanners linking to loyalty schemes, retailers want the latest to give their customers a more special shopping experience.

Point of sale may not have been an obvious use when Apple launched the iPad in 2010, but it has emerged as a major rival to the venerable electro-mechanical cash register. Cloud apps for small retailers are driving iPad usage in-store.

MYOB grabbed a stake of this business when it bought a small share in POS software vendor Kounta last year, rebadging it as MYOB Kounta to replace MYOB Retail Manager.  Kounta recently announced that it was taking on the US market, a battle it will fight alongside Kiwi startup Vend, which hitched its wagon to the Xero roadtrain.

Kounta costs $50 per register per month and hopes to take on the incumbents Micros and NCR. It will also come up against cloud apps by Square and Revel POS; the latter recently integrated with Intuit QuickBooks, the accounting software giant that has more than 80 percent market share in the US.

Retailers may see little difference between all these apps, but Jason Seed, North America president of Kounta, accuses rivals of double dipping.

Square and (recent entry) Groupon “have ulterior motives to get you on to a specific payment provider or service, which they obviously earn money from. They are far from being open, and this lock-in is dangerous for small business owners,” Seed said in a press release.

Kounta’s open platform approach lets retailers choose their payments provider and accounting software. The company’s own ambitions are far greater than replacing the cash register. It sees POS as the central business operating system for American businesses.

“There are 1.5 million POS machines running Windows XP in the US. They’re vulnerable, slow and inefficient. We’re a true competitor to the legacy systems, and we’re here to shake this market up,” Seed said.

While the startups talk the good talk on opportunity, the reality is that iPad-based systems running directly from the browser can struggle in high-throughput environments. It’s unlikely that iPads will pop up at a Coles checkout.

Australian vendor Task Retail Technology builds POS systems for enterprises. While the database resides in the cloud and can be operated on an iPad, the software is built for multi-site retailers looking for stability and reliability.

The POS system can run on a local machine at the store level in what national sales manager Owen Scott calls “cloud with a storm shelter”.

“It’s very difficult to get the complexity at the app level to sell chicken burgers,” Scott says. Fast food franchises may look like simple operations but the technology requirement is anything but. A POS to sell a chicken burger might require inventory, ordering for drive-through, staff rostering and integrated digital media. 

Task Retail is a single, end-to-end business system that handles all of the above, plus procurement, purchasing, labour management and inventory control. It’s the opposite of the API approach being touted by the likes of MuleSoft (more on that in a moment).

Task’s system can connect to digital menu boards and promotional panels in-store as well as loyalty programs on smartphone apps.

Task Retail is also looking at the US market where the size of the players almost requires them to use individual apps for each area. 

Despite the predominance of multiple systems, Task Retail has picked up several large enterprise customers in the US that are currently rolling out its software.

“The more control you have under one database, the less breakpoints and the more efficiencies you can apply,” Scott says.

Next: Customer connectivity

Customer connectivity

There’s a desire among retailers to tie the soft science of customer experience with hard sales data. An expensive jewellery store employs staff to walk around the store armed with iPads. They mingle with prospective customers, ask questions to determine their tastes, and record them in lead-capture apps.

These apps talk to the same database as the POS system so that an employee can recognise a regular customer and offer advice based on their past purchases, says Yamen Sader, director and principal consultant at Melbourne-based Sixtree, an enterprise integrator that uses an API approach to link disparate systems.

In order to work, front-of-house systems must connect to backend databases. Sixtree uses the MuleSoft integration platform to link RFID tags to the multiple supply chain, manufacturing and inventory systems used by larger retailers. MuleSoft operates to tie together off-the-shelf, custom, cloud or on-premise software.

Connecting disparate systems not only leads to automation, it gives retailers the option of trying new systems for different parts of the business. They can experiment with new loyalty programs or CRMs without having to overhaul the whole POS infrastructure.

The internet of things is making a welcome appearance in retail through the use of RFID tags. A large retailer can tag all their stock on the shelves and tie it back to their inventory management system. When the sales season starts up, the retailer just has to update the inventory database and the prices of all stock on the floor are automatically adjusted. Sader estimates that a store can save tens of thousands of dollars by eliminating manual prices. “When you are a retailer with a hundred stores, that’s millions of dollars in savings.”

Using MuleSoft helps customers avoid rip-and-replace upgrades. “We’re a big believer in creating ecosystems that work really nicely together without purchasing an off-the-shelf app. A lot of our customers can’t afford the risk or cost of ripping everything out and starting again,” Sader says.

The shift from silos to connected systems also opens the door to strategic services previously unavailable to retailers. The data flowing from point of sale to warehouse database is incredibly valuable but it’s usually ignored.

Sixtree has set up NoSQL datastores to capture the information and display it on real-time business dashboards with analytics tool Elastic. “That’s been one of the more tangible benefits for a lot of our customers. That data is normally locked down or not usable at all.”

Next: What’s in a scanner?

“There’s a lot of focus on customer engagement and interaction in-store,” says Tony Ignatavicius, managing director of Melbourne-based Datalogic, which distributes a broad selection of POS scanners.

Customers want two things: easy access to discounts or specials when they’re paying, and to pay and exit the store as quickly as possible. Loyalty schemes are a must-have for every retailer but it’s only worth having if the customer can access it quickly and easily at the checkout.

Some scanners will let customers scan their loyalty card or a barcode on their smartphone without interrupting the attendant while they scan their purchases and process the sale.
Other improvements focus on speed. The Magellan range is designed for high-performance throughput to minimise delays and mis-scans, where the wrong product is entered and has to be rescanned.

Digimarc technology should rapidly increase the speed of scanning. US-based Digimarc’s technology prints an invisible watermark all over the packaging of an item. Instead of the attendant or customer fumbling to find a barcode, Digimarcs can be scanned from any angle. Resellers need to make sure they are future proofing their systems for customers by selling them Digimarc-enabled hardware, Ignatavicius says.

Will Digimarc trigger a hardware refresh across Australian retailers? “It’s still early days but it has great potential,” Ignatavicius says.

And no one wants to be stuck in the line at the supermarket tills. One approach to reducing this time is queue-busting. During periods of high traffic, an attendant can approach the queue and scan the items before they reach the point of sale for payment. Retailers can use cordless scanners and mobile printers, such as the Joya mobile computer and an Epson or Toshiba bluetooth thermal printer.

Retailers are also keen to customise every part of the checkout experience to reinforce their branding. Look and feel is extremely important. Some scanners, such as the Heron range, are stylishly designed and fit unobtrusively on the counter. The retailer can add a logo or pattern and even program the audible scanning tones.

Taking this further are handheld scanners that shoppers can cart around the aisles and swipe products as they are placed in their baskets. It takes the customer-driven (and cost-saving) strategy of self-service checkouts to a whole new level. The service has been used at British supermarket chain Waitrose with what it calls ‘Quick Check’.

Apple’s move into payments is also big news. Although Apple Pay hasn’t launched in Australia yet, the imminent arrival of Apple Watch should change that.

The biggest problem facing resellers is choosing which technologies to sell first. And as any retailer will tell you, that’s a great problem to have.