Competitive Advantage through POS Systems
Technology in business is an important factor. A business that incorporates technology reaps more benefits, moreover, they have a competitive edge over their rival businesses. Small businesses have grown tremendously due to the fact that technology have brought in new feature that simplify the way things are done. They gain flexibility, processes are accurate thus leading to efficiency.
1.Advantages and Disadvantages of POS systems
Advantages
- A POS system has helped the business with greater accuracy on inventory data. This has in turn led to greater decision making where by the management of the business will not do guess work anymore. It has been noticed that the business can now have detailed reports on transactions done such as how much was purchased, sold or discarded.
- The POS system has helped the business to have more accurate data from transaction than when it was using cash registers. Information is automatically updated to the databases in real-time thereby eliminating the risk of human errors. Details dealing with transactions such as purchase, sales are reported in detailed format which helps the management to make crucial decisions.
- The systems also takes part in the managements of the employees at the business. It helps to reduce the time spent on schedules and schedule enforcement. It can allocate and perform reviews to specific functions and departments. Owner can therefore delegate more responsibility to the staff so as to establish accountability.
- The systems increases efficiency. This is because the system has given the staff all the tools to work on. For example, a barcode scanner will automatically collect information about products and relay it to the computers. In the old systems, the staff had to do all this work manually and there was high risk that it could be done wrongly (Pearlson, Saunders & Galletta, 2016).
Disadvantages.
Added costs to access the web is one of the disadvantages. For the POS to function, it must be connected to a network. This means that for the system to be online, it must have an access to the internet and the registers. This doesn’t come free. The business must incur monthly fee to the internet service provider.
Security issues are other risks that the business may encounter while using a POS system. Having a web-based system means that you may encounter privacy and security risks at any time. Even though POS providers offer a significant security protection, they can’t negate the fact that the system may be exposed to a certain level of danger (Cheney, 2003).
Competitive advantage is a circumstance whereby a business, company or organization is in a favorable condition that the others (Porter, 2011). Having a competitive advantage more than your competitor’s means that you may have integrated technology with the business in order to boost your services to the customers. This technology may be in form of using applications such as the ERP, HRMS and others. Having a POS system will offer competitive advantage in the following ways:
By the use of POS, customers of the Four Seasons Greenhouse and Nursery will be able to access information on what the business entails as well as that of the Point Of Sale System. The business can advertise their products through the POS system thereby attracting more customers than their rival businesses.
It helps the management know which products are profitable than the others. This will help in the pricing of products such that they will remain within acceptable product margins. Customers will settle at the businesses since it offers standardized prices to its products than to those businesses that hike their prices to products.
Digitalizing operations by using POS systems will ease long waits and frustrations of checkout lines. Customers are happy while using mobile payments and give the staff an opportunity to connect with them. This will improve customer experience and deepen loyalty (Skard & Nysveen, 2016).
POS systems gathers important information from daily operations in the business. Data obtained from sales and purchases must be stored properly since it is used to make important decisions of the business. Therefore a centralized database will have the following benefits:
It improves data preservation. In case of a disastrous hardware failure, the database offers a redundant storage that keeps data more secure. Data loss means that the business will incur more costs.
POS Systems and the Customer Experience
Centralized databases reduces cost. Maintaining a central server will incur less cost than maintenance on multiple computers. It also helps to minimize the overall space requirements for data storage and processing (Coronel & Morris, 2016)
When the business uses a centralized database, data security will be improved. A centralized database storage creates lesser challenges that ensuring data security across multiple local storage sites (Grachev, Esin, Polukhina, & Rassomakhin, 2014).
Centralized storage are more reliable than local storage. The business will boast comprehensive data access from anywhere. Updates run through a centralized database will be seen by all end users as opposed to a local storage where updates will be viewed by users who used that computer only.
First of all, the POS system will process business activities more effectively because of the speed at which it processes information. The POS system can process thousands of the business transactions faster thereby eliminating any delay that could result customers waiting. It also provides reliable and quick check-out processes, help boost up the profits and maintain detailed sales and inventory reports. Lastly the POS system can handle more than one payment options. Customers may opt to use debit and credit cards payments.
Information tracked by the POS system cannot be manually tracked. In the Four Seasons Greenhouse and Nursery, it can be seen that managers can use the system to locate those products that contributed to more profits and those that contributed less. This wasn’t the case before they implemented the system into their business. This shows that there are some of the information that the system can capture about relevant information about products that cannot be visible to the managers.
Information obtained by the POS system can be used for various uses in the case of Four Seasons Greenhouse and Nursery. First, it can be used to set prices to products such that they remain within the acceptable product margins. It can also be used to know which products are more profitable than the others and therefore make wise decision to shift those products that brought high profits. It can also be used on how to manage workforce at the business. Managers can decide whether to add workforce or lay down workers based on how they are performing their duties (Wu, Straub, & Liang, 2015).
Several questions can be answered easily following from information obtained from the POS system:
Whether to reduce or decrease price for products?
Using Centralized Databases for Data Preservation
Which products are more profitable?
Gross profits obtained from sales of products in a year?
Telecommunication is very important to any business. It is used to communicate with customers, suppliers and other stakeholders. For a business to be successful it must implement clear and working and networking channels (Carr & Snyder, 2003). There are different types of networks that can be used in any business; examples can include Local Area Network (LAN), Wide Area Network(WAN), Metropolitan Area Network(MAN), Wide Local Area Network(WLAN) to mention a few (Axelsson & Easton, 2016).
In Four Seasons Greenhouse and Nursery, the most likely type of network to be used is the Wide Area Network (WAN). This is because it offers a much wider range that MAN and LAN networks. It also offers a platform whereby the business can connect their cash registers in order to track sales in real time.
Wireless technologies such as the use of WI-FI will best suit the operations of the business. It can be used by devices such as laptops, hand-held devices such as smartphones and printers which are connected to a router. These technologies; increase the efficiency in which there is a fast transfer of data and information between customers, patners and the business. It also increases availability in that staff don’t have to always sit behind dedicated computers. They can have the freedom of working from wherever they want and still have wireless access to data. Costs incurred in setting up wired networks will be high and will also reduce space at the business (Cavallari, Martelli, Rosini, Buratti, & Verdone, 2014).
Security
Using the POS system can lead to the following security issues:
Software and network weaknesses – these problems occur mostly when the network is not secure. Hackers with evil intentions can penetrate through the network and may even flood the network with request or even slow down the service making operations ineffective. Crucial data, too, is subject to theft or manipulation.
To prevent this, the system should be kept on its own, and secure network. It’s also important to keep it up-to-date to with the most current security measures.
Cyber- crime – it is a more malicious and sophisticated problems that comes along with technology. The business should take preventive measures so as to keep the system secure (Moore, 2014).
Faults in devices might also occur.
Privacy
Personal data, such as email passwords, bank accounts numbers, and credit and debit card numbers can be stolen in a case where attackers have taken control of a POS system. It is therefore crucial that customers should not disclose any information to any one as this information can be used for malicious activities such as fraud.
Confidentiality
Confidentiality is the state of whereby confidential information is not disclosed to unauthorized entities, individual or processes (Singh, 2015). POS systems should not allow any unauthorized access to unauthorized individual. Spoofing, active wiretapping, use of ping are the type of attacks that can be used to violate the confidentiality of information (Zeng, & Zhang, 2016). The business should therefore put a fire wall in place to filter all content being transmitted in and out of the network.
Conclusion
In conclusion, POS system has the capability of making Four Seasons Greenhouse and Nursery grow as well as compete favorably with other businesses. It has noted that there are many benefits that come along with automating processes at the business. Though technology comes along with its share of risk, it worth incorporating technology in businesses
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