Restaurant POS Buyers Guide

A restaurant POS (point of sale) is the hub of your business.

It captures orders and routes them to the right stations; it allows for easy handoff of a customer from the bar to the table; and it secures payments and delivers rich operational data to reporting systems.

As a restaurant owner, you have a million things to worry about day-to-day and, with all the options out there, researching restaurant technology is time-consuming. We created this guide to help restaurateurs understand their options and identify how new technologies can deliver deep insights and contribute to great hospitality.

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What is a restaurant POS?

Restaurants have unique operational needs, and with hundreds of point of sale systems available, it makes sense to focus on those that are purpose-built specifically for the needs of a restaurant.

Unlike a generic retail POS, a POS created specifically for restaurants supports fast, accurate communication between FOH and BOH and reduces operational inefficiency. Functions such as kitchen printer support for numerous stations, forced modifiers, coursing, auto-fire, and chat functions make ordering fast and accurate; FOH functions like tableside ordering, check splitting, mobile payments, and more allow your staff to focus on the guest instead of on workarounds required by other POS systems that are designed as an all-purpose or retail solution.

Choosing a restaurant POS will only save time and aggravation in an industry where a single-digit decrease or increase in margins can make or break a restaurant’s success.

Cloud-based vs. legacy POS systems

All POS systems fall into two categories: client-server solutions or cloud-based solutions. Client servers, also known as “legacy solutions,” are self-contained units in which all data, logic, settings, and software updates must be handled at the location.

Cloud-based POS solutions securely sync updates, data, settings, and activities to the cloud, meaning that they’re accessible — with proper credentials — in a variety of settings and via a variety of devices, including iPads, mobile phones, and web browsers.

A cloud-based system offers benefits such as (but not limited to):

• More mobility, since the system can operate on tablets rather than fixed stations.
• User-friendly devices and software interfaces that make training new employees easier and faster.
• Automatic updates with new features and capabilities that don’t require changes to hardware configurations or equipment.
• Remote access to reporting, settings, and menu information.
• Tableside service with modern payment types, such as signature-on-screen and mobile payments.
• Live updates of restaurant performance (i.e., sales, comps, voids, checks, and more) available through a web browser or a native mobile app.

What are the components of a restaurant POS?

Every restaurant is unique, and the restaurant point of sale system needs to be flexible enough to match the individual needs of each operation.

A reputable restaurant POS provider will take the time to understand your restaurant — how many terminals are required, the layout, the size of your staff, and the number of locations, to name a few — and help map out a custom solution, rather than sending off a generic quote or assuming that one size fits all.

Things to consider when choosing a restaurant POS

A. Hardware

You might be inclined to think of a point of sale just as the hardware that sits on a countertop and captures orders and payments. In reality, a restaurant POS is both the hardware and the software that runs on the terminal.

That doesn’t mean the hardware isn’t important. The best systems run on modern, consumer-friendly devices, which are easier to use, more attractive, compact, and mobile.

Your exact hardware needs will depend on the type of service you provide. For instance, a smaller restaurant or one with counter-to-table service may need a couple of stationary terminals, while a busy bar might want to include mobile devices to take orders and payments tableside.

While final hardware configurations may differ, most restaurants select at least the following components:

• Tablet terminal with a stand and built-in, EMV-compliant credit card reader to capture orders and payments.
• Cash drawer for storing and handling cash payments.
• Receipt printer for printing out receipts and signature slips.
• Kitchen printer or KDS for sending orders to the kitchen.
• Networking router and access point for connectivity of the cloud-based POS.

B. Software

Software that is purpose-built for restaurants (as opposed to retail or other businesses) comes with specific capabilities and functions baked in. It’s important to know the capabilities you’ll need to support your operations and evaluate the system based on how intuitively and reliably it provides these capabilities.

Most restaurants consider the following capabilities as must-haves:.

• Employee management and labor reporting. Manage labor costs, employee permissions, gauge server performance, and more.
• EMV, mobile payments, and pre-authorization. Accept chip-card payments without expensive third-party integrations, process payments with mobile payment options like Apple Pay, and pre-authorize a bar tab with the swipe of a card.
• Menu customization and intelligence. Adjust, customize, and change courses and menu items from any tablet or browser, and access insights on which menu items drive highest sales and repeat customer orders.
• Tip adjust and split checks. Quickly adjust the tip, even without a card in hand, and easily split checks based on diner preference.
• Training mode. Train employees and practice new features on POS using your actual data, users, and menu without taking your entire system out of service.

You should approach restaurant POS providers with a clear sense of what you value, and note how they’ve designed the software to meet those needs.

C. Payments

Restaurants are increasingly recognizing that POS solutions that also provide payments processing come with significant benefits. With a full restaurant management platform, you get benefits like a single point of contact for onboarding and support, faster and more accurate settlements, and unified reporting. Perhaps the most valuable and surprising benefit of these unified solutions is the ability for the POS provider to deliver deep guest insights and analytics for restaurants..

Analytics derived from a unified view of payments and operational data provide specific insights and opportunities to improve hospitality that can’t be gleaned from standard POS or processor reports.

By combining customer payment data with transactional details, these systems measure server performance down to who moves the most desserts, and can also determine which menu items drive repeat visits. They also easily compare new versus repeat sales across multiple locations and see social media reviews from multiple sources on one screen.

The result is rich guest profiles that don’t require manual input of guest notes and preferences, with advantages like robust loyalty programs, marketing capabilities, and superior hospitality.

D. Mobile App

Operators should be able to access live performance data and communicate important information no matter where they are. This is particularly crucial for multi-location owners and managers.

A good restaurant POS mobile app includes:

• Net sales, and check and guest counts.
• Real-time labor costs and ratio to sales.
• Comparative week-over-week, month-over-month, and year-over-year views.
• Access to one, many, and all venues.
• Shift notes and log book updates.

Restaurant POS providers approach mobile requirements differently. Some don’t offer a mobile app; they’ll tell you to access your POS reporting from a web browser on your phone. This can be cumbersome for an already busy restaurant operator — it’s slow, and views are not optimized for mobile use. Other providers may offer a version of a mobile app, but charge an additional fee for access.

When speaking with a provider, be prepared to ask the following questions:

• “Do you offer a native mobile app that sits on my phone or do I have to access from a browser?”
• “Can you show me examples of how you present the data in a mobile app?”
• “How much does your mobile app cost?”

E. Technology Integrations

A good restaurant POS solution should have a number of technology integrations to streamline your digital processes.

For example, if you use an app for inventory management, sales data should flow from your POS to the app so that assumed inventory levels need only be confirmed with the tap of a screen. This quickly spotlights gaps between assumed inventory and actual counts so that you can instantly identify losses that could be due to theft or waste.

The apps available for integration should reflect best-in-class vertical solutions for things like inventory, online ordering, workforce management, gift cards, and accounting. When selecting a provider, assess their technology marketplace, and ask about specific integration points and costs.

What are the four pillars of a restaurant POS?

We’ve covered the components, features, and integrations of a restaurant POS, but that’s only half the story. Beyond the hardware, software, and services are the actual values your restaurant receives.

The best way to think about these values is as the pillars of a top-notch solution. The perfect POS will hit four values: reliability, ease of use, support, and training.

Let’s take a quick dive into how to evaluate these four pillars.

A. Reliability

Few work environments can match the frantic pace of a restaurant. The last thing you need to worry about is whether or not the POS is working.

A question restaurants often ask about cloud-based POS systems is, Will it work if I lose connectivity? If it’s a good system, the answer is yes.

A restaurant POS should provide an Offline Mode capability. This ensures your service is able to operate normally when connectivity is lost. Offline Mode is automatically triggered whenever the system senses a loss of connectivity. During this time, you can open and close checks, fire off orders to the kitchen, print receipts, collect payments, adjust tips, and more – all the critical functions for the restaurant. Once the connectivity is restored, the system will kick back online and automatically begin syncing payments and checks automatically.

B. Ease of use

One of the main benefits of a restaurant POS should be how easy it is to use.

A user-friendly system isn’t just a “nice-to-have.” When servers are able to spend more time with guests, suggesting the best wine pairing for the entrée or whetting their appetite for dessert, rather than fiddling around in the POS, that puts time and money back into your pockets. Each feature, from how you split a check to how you modify a menu, should be built specifically with the restaurant in mind. It not only saves time, it enhances the hospitality.

C. Support

Restaurants don’t operate on a month-to-month schedule. It’s day by day, shift by shift, minute by minute. When something is not working, you can’t wait to schedule an appointment for next week.

Legacy point of sale providers will regularly charge for the ability to call for basic troubleshooting, and restaurant owners have estimated the fees can climb north of $2,000 a year. In some cases, they’ll refer you to a field office, which only operates on a Monday through Friday schedule.

Restaurant POS providers typically take a different approach, offering support as part of their service. This means basic support services don’t come at a cost that racks up month after month. Plus, their support call center will be open 24/7/365. Top-tier providers will also assign a dedicated account manager to your restaurant who is provided to ensure you get the most out of the product and satisfaction with the system.

D. Training

You should specifically ask if the product includes a Training Mode function. This works by allowing staff to train on a terminal and learning the features of the POS while using your venue’s data, such as your menu, without having to take all of your terminals out of service or impacting your reports. Not all restaurant POS systems include this feature or offer the ability to put a single terminal into Training Mode without putting the entire system out of service, so be sure to drill into this capability when making your choice.

How much does a restaurant POS cost?

Legacy POS providers tended to sell hardware and one-time software licenses with high upfront costs and ongoing service fees. Cloud-based POS solutions take a different approach, offering a fixed monthly price for Software). Often, hardware costs can be included or financed as part of that price. The upfront costs are lower and the monthly fees are predictable.

Cloud-based solutions also deliver more frequent security and system updates, as well as new features and capabilities. In other words, what you get upon purchase keeps getting better without expensive service calls and hardware upgrades.

Restaurants are embracing this model because it ensures their locations always have the best systems in place at a lower cost for service, equipment, and software.

A report by Nucleus Research found that a cloud-based POS saved the average restaurant 48%, compared to a legacy system, over the first three years of service. That study found the cost of a restaurant POS ranged from $2,000 to $10,000 for software and hardware, which was less than most comparable legacy systems just for hardware.

But it’s just as important that you consider how you’ll pay for the system. Some point of sale providers offer a single option for purchasing the software and hardware while others offer a variety of options.

The most common method is for the restaurant to sign a multi-year contract for the software and payments processing, and purchase all the required hardware in one lump sum. This requires an upfront expenditure that can be difficult for an expanding or new restaurant to absorb.

Pricing options that help defray upfront costs — either through monthly financing or offering hardware and software bundles as a service — give restaurants the ability to invest in a modern system and its related services, without requiring a large investment upfront.

When investing in a restaurant POS system that includes processing, you’re more likely to see competitive rates, along with the additional analytics. It’s important to understand how any provider structures their processing fees. Make sure that fees are transparently communicated and updated on a monthly basis. The most transparent companies will list their price as a flat price per transaction plus “Interchange.” This is the combined cost of association fees and dues charged by the credit card companies; the restaurant POS provider won’t keep this part of the fee. If they won’t show you how the bill will look, they’re not being transparent enough.

When thinking about the cost of your system, consider unexpected support costs. Many solutions will charge additional fees for basic services such as the ability to call or chat with a support representative or to upload a menu into the system when first installing the system. Ask providers you evaluate to share their costs for basic 24/7 support, onboarding, and menu updates.

On a final note, consider the installation options. For cloud-based solutions, installation can be fast and easy, but you will want a choice of a remote (phone/telepresence) installation or an onsite (in-person) installation. The latter may cost a little more, but it provides peace of mind, can be faster, and may even come with some basic training.

Most providers will offer both forms of the service, though pricing will be higher for onsite installs. Ask about these options and the costs and timelines associated with each.

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