What is point of sale?: Master the payments basics to grow your business – online and in-store.

When your customer completes a purchase, you make a sale. That is the point-of-sale moment. This can occur at a checkout counter, at a restaurant table or through a mobile device.  

The technology used to accept payments ensures every transaction is processed and recorded correctly and securely.  

Understanding how your business accepts payments at the point of sale can make it easier to choose the right business tools, streamline operations, and support a smooth checkout experience for both you and your customers.  

Why point of sale matters for every business

Whether your company is an enterprise or a small, non-technical business, it’s still important to understand how point of sale works. It enables you to accept the various payments your customers expect, such as card, contactless or mobile.  

A point of sale can take many forms, depending on how and where the business interacts with its customers. 

This could be a: 

• Retail checkout counter

• Tableside restaurant payment

• Mobile card reader at a service appointment 

• Checkout outline

What is a point-of-sale system? 

In each case, the point of sale is the moment and location of a purchase. A point-of-sale (POS) solution is the technology that supports and captures payment information. It combines software, hardware and payment acceptance capabilities to create seamless payment experiences for you and your customers. 

A holistic POS solution fills three key business needs:

• Accepting different forms of payment

• Recording all transactions

• Supporting daily business operations

What are the key components of a POS system?

A comprehensive POS solution consists of three core components: software, hardware and payment data capture and acceptance. All work together to complete and manage every transaction.  

POS software

The software for a POS system manages transactions and captures data for analyzing trends and helping make informed decisions. It can record sales, calculate totals and store transaction data securely.  

Common software functions include sales reporting, inventory tracking, and employee permissions. 

POS hardware

POS hardware is the physical device used to complete transactions. The hardware works in conjunction with the software to ensure an efficient checkout experience. Common POS hardware includes card readers, terminals, tablets, receipt printers and cash drawers.  

There are multiple types of hardware options available to support different business environments and industries, including: 

• Retail and restaurants usually use countertop setups. 

• On-the-go businesses rely heavily on mobile setups.

• Multi-location businesses rely on consistent hardware across sites to support unified reporting and management. 

Payment acceptance

At the point of sale, the system captures transaction data and enables payment acceptance. When a customer is ready to pay, the POS device reads payment information from a card, mobile wallet or other method and records the transaction details. This ensures payment data is captured accurately and handled securely, helping deliver a smooth and efficient checkout experience for both businesses and their customers.

Read more on how payment processing works in our guide to credit card payment processing. 

How businesses accept payments at the point of sale

Customers expect businesses to accept their preferred payment method. When customers are ready to make a purchase, business owners must make sure that they can accept the different payment types, including credit cards, debit cards, contactless payments, and mobile wallets. 

When a customer presents their card, the card-issuing bank authorizes the payment, the authorization is transmitted to the merchant's acquirer at the point of sale and the merchant will finalize the sale, providing the customer a receipt for the goods or services sold, along with transaction receipt for the point of sale system showing the payment was accepted – a process that occurs in only a few seconds. Speed and reliability matter at checkout because customers want to make their purchase quickly and easily, without any unexpected delays or hurdles. That’s why it is essential for small businesses to have a reliable POS system and payment processor. 

How POS systems support daily business operations

A POS system plays a central part in managing day-to-day operations. It helps business owners operate more efficiently, make informed decisions and maintain overall consistency throughout their operations.  

Sales tracking and reporting

POS solutions automatically record every transaction at the moment of the sale, which creates a detailed and accurate report on business activity. This makes data easy to organize, review and analyze. Business owners can access daily sales totals, popular products or services and busy times of the day. 

Inventory and order monitoring

Your POS solution is a critical tool for monitoring inventory levels and tracking items as they are sold since inventory levels are updated in real time during transactions. This reduces the risk of human error and eliminates the need for manual tracking. 

Security

Protecting customer data is top priority – including their card information, name, phone number, email address, and other information captured during a transaction. That’s why it is important to have a POS solution with the highest levels of payment security built in, including compliance with PCI DSS requirements.

How Elavon supports point of sale solutions

Elavon brings decades of experience supporting businesses across industries and around the world by delivering reliable point of sale solutions. From retail and restaurants to service-based and multi-location operations, our POS solutions support all business needs. 

In addition to technology, we provide 24/7 client support in numerous languages – giving business owners access to knowledgeable payment experts who can help optimize payment setups, troubleshoot issues and ensure systems continue to meet operational needs over time.  

Get started with our robust point-of-sale solutions.

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