Restaurant POS Buyers Guide

Few investments are as critical to smooth restaurant operations as the point of sale (POS).

The POS is like the central nervous system: it captures orders and routes them to the right stations; it allows for easy handoff of a customer from the bar to the table; it secures payments and delivers rich operational data to reporting systems.

But restaurateurs are not naturally inclined to spend a lot of time researching technologies. Decor, kitchen equipment, hiring, and even location are consuming concerns; it’s hard to place attention on the potential restaurant POS system when your time is already spread so thin.

It’s not neglect. It’s probably more likely a result of restaurateurs spending their time focused on   delivering remarkable hospitality, instead of learning the ins and outs of technology. The result is that restaurant owners and operators may end up with a restaurant POS that may not match their needs.

We created this guide to help restaurateurs understand their options and identify how new technologies can deliver deep insights and actually contribute to great hospitality.

We’ll pose quick questions and use your answers to generate a customized POS Buyer’s Blueprint that we’ll send directly to your inbox.

Let’s get started!

What is a restaurant POS, anyway?

Restaurants have unique operational needs, and with hundreds of point of sale systems for restaurants available, it makes sense to focus on those that are purpose-built specifically for a restaurant’s front-of-house (FOH)/back-of-house (BOH) operational flows.

Unlike a generic retail POS, a POS created specifically for restaurants supports fast, accurate communication between FOH and BOH and reduces operational inefficiency. Specific 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 retail or other point of sale systems.

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 or legacy POS?

All POS systems — restaurant and otherwise — fall into two categories: client-server solutions or cloud-based solutions. Client server, 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 restaurants prize as much as a cool-under-pressure bar manager. A partial list includes:

• More mobility since the system operates on tablets (such as an iPad) rather than fixed stations.
• Consumer-friendly devices that are faster to train on and easier to use.
• Automatic updates with new features and capabilities that don’t need changes to hardware configurations or equipment.
• Remote access to reporting, settings, and even 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, etc.) available through a browser or a native mobile app.

These benefits are rapidly leading more restaurants to adopt cloud-based POS systems over legacy systems. Some restaurants may hold back based on common myths about cloud-based point of sale systems.

But your decision should be based on facts, not myths.

Understanding the components of a restaurant POS is key.

What are the components of a restaurant POS?

Your restaurant reflects your vision and approach to hospitality. Every restaurant is unique, and the restaurant point of sale system needs to be flexible enough to match the unique 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 FOH and BOH staff, number of locations, etc. — and help map out a custom solution, rather than sending off a generic quote or assuming that one size fits all.

Here are some things to consider when evaluating any restaurant POS:

Hardware

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

That doesn’t mean the hardware isn’t important. The best systems run on modern, consumer-friendly devices, like tablets and smartphones, which are easier to use, 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 stand and built-in credit card swiper to capture orders and payments.
• Cash drawer for storing and handling cash payments.
• Receipt printer for printing out receipts and signature slips.
• Kitchen printer for printing out orders for the kitchen staff.
• Networking router and access point for connectivity of the cloud-based POS.
• EMV reader to compliantly capture and process chip card payments.

This represents a basic one-terminal setup. You might also consider other equipment based on your front-to-back-of-house requirements. This could include a Kitchen Display System, mobile tablets for tableside service, or even terminals dedicated solely for training to speed up productivity for staff on the floor.

Your hardware needs are dependent on your layout, people, concept, and more. Be sure to share these details with any restaurant POS company so they can customize your solution.

Software

Restaurant POS software is the heart of the system. This how you and your staff will manage covers, checks, orders, receipts, reporting, and many, many more functions. Cloud-based systems handle these functions in the cloud and allow access from anywhere. They also distribute software updates automatically so that your software is always up to date, secure, and feature-rich.

Software that is purpose-built for restaurants (as opposed to retail or other businesses) comes with specific capabilities and functions baked in. The most sophisticated systems include dozens of features, many of which have subtle differences, so a feature-by-feature breakdown is rarely a valuable exercise. A better process is 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 (and overtime), employees permissions, and access to specific features in order to control costs and identify your worst and best servers.
• EMV, mobile payments, and pre-authorization — accept chip-card payments without expensive third-party integrations, process payments with mobile payment options like Apple or Android 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 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.
• Communication and updates — provide managers and employees prompting to communicate info on every shift via mobile device, email, and reporting.

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.

Payments

Restaurants have come to expect that they will have different providers for payment processing and point of sale. But it doesn’t have to be that way. Restaurants are increasingly recognizing that POS solutions that also provide payments processing come with significant benefits. With a restaurant management platform, you can get benefits that include 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 these POS providers 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. The advantages include robust loyalty programs, marketing capabilities, and superior hospitality.

The POS moves beyond point of sale and becomes a point of service.

When considering a solution for your restaurant, you should ask which restaurant analytics capabilities come with the solution, and how these directly help you deliver great service, increase check size, and drive repeat visits.

Mobile App

A top restaurant POS will recognize the need for mobility.

Restaurant management cant be constrained by a single location. Operators must be able to access live performance data and communicate important information no matter where they are. This is particularly crucial for multi-location operators.

This is why any reputable restaurant POS provider should include a mobile app as part of their solution. This frees you up to access real-time sales and operational data whether you’re on the floor or (hopefully) on the beach.

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?”

App Marketplace

Interconnected apps allow you to manage your business using best-in-class apps designed for a specific purpose without having to move data and settings from one app to another.

The top restaurant POS solutions have introduced marketplaces for customers, which bring together restaurant software and POS solutions and unify them.

For instance, 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. Further, 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 in these marketplaces should reflect best-in-class vertical solutions for things like inventory, online ordering, workforce management, gift cards, accounting, etc. When selecting a provider, assess their marketplace, and ask about specific integration points (sometimes a marketplace partner is simply paying for advertising) and costs. Not all marketplaces are created equal.

What are the 4 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-fitting 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.

Reliability

Few work environments can match the frantic pace of a restaurant. When orders are flying, every table is seated, and your kitchen is in the weeds, the feeling is an entrée of exhilaration with a dash of panic. The last thing you need to worry about is whether the POS is working.

A question restaurants often ask about cloud-based POS systems is, Will it work if lose connectivity? 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 … 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.

Many POS systems for restaurants feature some version of Offline Mode. But a new trend is for solutions to offer greater transparency around their network uptime and downtime, as well as support metrics. Usually, these are hosted on the solution’s status page, which they make publicly accessible. You should ask any restaurant POS provider you vet whether they publicly post their network uptime and support metrics.

Ease of use

One of the main benefits of a restaurant POS is how easy it is to use. Frequent reviews from customers who switch over from a legacy system typically make statements like, If you can work a smartphone, you can use the POS.

This isn’t a “nice to have” difference. It adds significantly to your margins, employees’ productivity, and the experiences of your guests. 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.

A restaurant POS saves time by designing for the restaurant owner, manager, cook, and server. 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.

Support

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

Support is a pillar of a restaurant POS that can be misunderstood or undervalued. But it should factor heavily in your evaluation.

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. Yes, that includes holidays.

Most solutions will offer a version of this support, but there are areas you can dig into. You should ask solution providers whether they offer public metrics about their support performance, such as how often they are able to route a support call within 30 seconds.

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. This is also worth inquiring about.

There are also support enhancements, such as in-app chat from the mobile app or from the provider’s support site so you can communicate in the moment through online chat. A premier restaurant POS will provide a variety of channels for support: phone, email, chat, and account management. You should ask about each of these.

Training

Anyone who has ever trained restaurant staff knows how time consuming and disruptive it can be. When you evaluate a POS, you should also consider the ramp time and impact on service. Restaurant POS systems speed up the learning curve by offering an easier, intuitive system.

This can have a significant impact on business. Training represents a real, but often hard-to-measure cost to the business — particularly in an industry with high employee turnover. Thus, ease of use and restaurant-specific design are essential when it comes to 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.

How do you pay for and install a restaurant POS?

Now that we’ve explored what’s included in a restaurant system, how it works, and the biggest benefits of the system, you’re likely wondering, how much does a restaurant POS cost? 

The short answer is that costs are variable.

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 as a Service (or SaaS). Often, hardware costs can be included or financed as part of that price. The upfront costs are lower and the monthly fees are predictable.

SaaS 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 recent 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 up front. It’s worth asking the company providing the solution what pricing options they offer to get the best fit.

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.

Lastly, 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 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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