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Cloud vs. Local POS: Which is best for my Business?

The constant evolution of technology in this modern world has opened up lots of new opportunities for each business to grow in numerous ways. The traditional ways are now slowly being replaced by new and more advanced machinery. For example, Point of Sales system has been around from many years but the modern POS systems have seen unimaginable changes. Traditional point of sales systems are now being replaced by cloud based systems as they are proving to be more convenient and reliable.

Cloud vs. Local POS: Which is best for my Business?

First of all, when it comes to choosing a point of sales system for your business it becomes a hell of a task because there are quite a good number of systems available. A good POS system is a crucial part of your business as it has the potential to grow your business rapidly. No matter what business you own the first thing to setup is the POS system. Choosing a POS system depends on the type of business you own.

There are different point of sales systems to choose from including mobile point of sales or a whole point of sales system setup like at the checkout counters of malls. But one most important decision you have to make is whether you want a traditional point of sale system or a cloud-based point of sale system. If you have a confusion on choosing from one of these two options then read this article as we will help you to decide what is better for your business.

 

Let us first discuss what these two POS systems are actually.

Traditional POS System

A traditional POS system is also known as “on-premise” or “legacy” point of sale system. The traditional POS system stores data on a local server. This system operates within an internal network. To put it in a simple way, this type of POS system works much as the computer at your home. The programs can be used only on that personal computer and the data will be saved on the local drive and it cannot be accessed from anywhere else.

Cloud-Based POS System

In recent years, cloud based technology has become a new trend in the market. It is also known as mobile POS or Software as a Service POS (SaaS POS). This is a web-based service and the data is stored online instead of a local storage. This allows users to access their data from anywhere on the globe and at any time all they need is an active internet connection. Nowadays, even small and medium businesses have chosen to shift to cloud based POS due to the affordable pricing and numerous functionality.

 

WHY TRADITIONAL POS SYSTEM?

Now that we know about what this both systems are let us find out what benefits and disadvantages does a traditional POS system offers.

Traditional or on-premise POS system have numerous advantages.

Larger Display: A traditional POS system comes with a whole setup of hardware that includes a terminal, cash register, barcode scanner, receipt printer, etc. The display is a big computer screen known as the terminal. This allows the employees to access the functionality of the system smoothly and provide stability in the business. Mostly this kind of setup is used in hospitals, supermarkets, malls, etc.

Wide Range of Functions: A traditional POS system offers much more than just a bigger setup and display. It offers wide range of functions that make your business run smoother and be more productive. Some of the distinct features this system offers are inventory management, accounting, data storage, low inventory notifications, high security etc. These features are much needed for businesses and therefore will keep the traditional POS system in the market for quite a long time.

Nothing is perfect. And when it comes to software something always be missing in each one of them. Some of the disadvantages of a traditional POS system are as follows:

No Mobility: One thing that sets the traditional POS system back is its lack of mobility. To access the information and data you need to be present at the terminal yourself as this system does not have remote login functionality.

Higher Cost: As mentioned earlier, a traditional POS system comes with a whole setup of bunch of hardware. Implementing each one of them increases the overall cost of setting up a traditional POS system considerably. Therefore, small and medium businesses don’t readily choose this system.

 

WHY CLOUD-BASED POS SYSTEM?

Here are some advantages of cloud-based POS system:

Accessibility: This is perhaps the greatest advantage of this system as it allows the user to access information from remote locations. It makes it possible to stay in touch with your business no matter where you are. All you need is an active internet connection. This way you are able to handle your business even when you are away from your store.

Higher Accuracy Rate: Small and medium businesses usually face a problem regarding sales and inventory. More often tracking inventory details becomes difficult due to limited or no facilities. This in turn affects the business productivity due to lack of supply of goods and materials. A cloud-based POS system keeps you updated on the inventory details so that you can stack it up whenever the products are running low in quantity.

Affordable: This is one of the most important factors for small businesses. A cloud based POS system comes as a subscription package and the sellers don’t even charge the upfront fees. This way small businesses don’t have to invest a lot in the point of sales like the traditional system. And the monthly bill includes the data backup and system upgrade charges.

Scalability: Cloud-based POS system allows you the freedom to increase or reduce the number of devices you use. Scaling does not require additional hardware and thus saves you some more money.

Security: Security is the foremost concern for every business as it can make or break your business flow. With cloud based POS system your data is stored on a different server and the system is backed up automatically from time to time. This ensure the safety of your data even in the event of a system crash or if you lose the device.

Business Insights and Better Customer Service: This both factors go hand in hand. The POS software allows you to scan items instantly but additionally it also tracks and records the transactions. It also keeps record of purchase histories of the customers. So when next time a customer enters your restaurant you can easily identify him/her and provide better service based on their previous orders.

Although the cloud based POS has so many advantages there are some disadvantages too with this system as follows:

Dependent on Internet: This system is completely internet dependent and requires constant healthy internet connection to work smoothly. If you face unstable internet connection then you run the risk of disrupted service. This might also affect your sales.

Cannot be customized: Cloud-based POS does not offer room for customization like the traditional system does. Small and medium sized businesses don’t have much problem with this but larger businesses can suffer.

 

 

CONCLUSION

Through all the advantages and disadvantages of both the systems now we know that both of them possess their own strengths and weaknesses. Traditional POS systems are made for, and also suit, larger businesses as they provide stability and hassle-free transactions at the checkout counter.

On the other hand, Cloud-based POS system is affordable for small and medium sized businesses like restaurants, cafes, retail stores, etc. where there is a limit for initial investment. The bottom line is you need to first look at your business and the budget you are willing to allocate to the POS system. This way you will be able to choose the best POS system for your business.

 

See : 5 Best Cafe & Restaurants Cloud Based POS System 

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