For many entrepreneurs, keeping start-up costs low while launching a new enterprise is viewed as being the key to initial success. Plus, who doesn’t like the word “free,” especially when it comes with the promise of getting your business off to the right start? You do, however, want to make sure you understand what’s included in the “free” services.
Understanding the potential pitfalls of bringing in a free POS solution is the first step towards making an effective decision on which solution to implement. And while free can be good in many ways, should this be something you seek out in a system that will be a cornerstone of your business? Are the best POS systems really free? Probably not, though it often depends on how much functionality you’re able to live without, as well as how much you’re willing to give up to keep costs down.
Missing Features in Free POS Systems Can Increase Your Costs
The old adage of “things aren’t always as they seem” is especially true when talking about free POS systems. At first glance, these solutions may appear to be promising options, but how many of these systems actually come with the features you require? Suppose a free platform can handle basic transactions but doesn’t capture or store any of the key information around the sale – what, how much, by whom?. How are you going to make effective business decisions without this key information? More importantly, how many of the offered features require a fee to be unlocked for use, or cost a hefty subscription fee for continued use after a trial period? While it is true that some aspects of the solution may fit the bill, may only be available when the service is purchased.
Considering a free POS option for your business adds complexity to your final decision. While the vast majority of pay-for-use POS solutions are upfront and transparent with what their offerings include, this is seldom the case with free POS options. In fact, most have pay-for-use features and microtransactions buried inside of the core product, making it difficult to evaluate the actual cost of the solution.
It is worth noting that free POS systems often seem to have benefits for small businesses, especially those that have recently opened their doors. After you factor in a lease, staff payroll, the cost of a website, and the price of manufacturing or ordering your products, you might realize that you haven’t accounted for a point of sale system in your budget. That’s where a free system starts to look pretty appealing. It might even work well enough in the beginning. That is until it starts asking you for more and more money to continue your use. If you find yourself using a free solution that locks up key features or only offers a trial period, consider the risk to your bottom line that forgoing necessary functionality poses. It’s important, free or not, that your POS system properly aligns with your current and future business goals.
Does the POS System’s Structure Align with Your Business Goals?
The ideal POS solution will include essential software integrations that fit your business model. These may include accounting, inventory management, employee management, and transaction reporting. Often times, free POS systems only include these as part of a purchasable service or add-on, turning a once cost-effective solution into one taking a bite out of the bottom line. Unfortunately, in most cases, this is discovered once the solution has already been implemented. These add-ons are often buried in the fine print, which we all like to say we read, but realistically, often escapes the attention of a busy entrepreneur.
One Owner’s Experience
A small coffee shop that had contacted us for help had to learn about the downsides of free POS systems the hard way. Looking for ways to save on start-up costs, the shop owner had opted to implement a small-scale, free POS system which promised easy-to-manage transactions with a restaurant-oriented inventory tracking module. The software looked great in the beginning until the owner needed to figure out why the shop was frequently running short of milk. When the owner attempted to utilize the inventory management module, it was discovered that it would only track 50 items for free and that a substantial fee would be required to unlock the tracking for further items.
The coffee shop owner was able to temporarily resolve the issue by resorting to hand tracking milk usage and manually reporting transactions until a new POS solution could be found and implemented. However, the shop experienced financial losses until that system was put in place. One goal of your POS system should be to properly align with your business needs and goals. The POS system you implement must be a valued asset that works well with your business without losing out on critical functionality or being hit with hidden fees.
Avoiding Potential Undisclosed or Hidden POS Fees
Imagine you’re going to ring up a customer and they request their bill to be split between different payment methods. “No problem,” you think. However, when you go to select multiple forms of tender, you’re presented with a screen that says “Upgrade to Pro to Use This Feature.” Now you’re left with a frustrated customer and a free POS that turned out not to be nearly as free as you had hoped.
One of the most frustrating aspects of a free POS system, hidden or undisclosed fees can present your business with a serious issue. The impact of obscure fees is detrimental to the bottom line of any business and can spell out catastrophic consequences to a business that is struggling in those valuable first months of opening.
Hidden fees can come in many forms, but some of the more popular fees to watch out for are:
- Customer service. Many free POS options do not offer included flexible customer support options. This will cause an issue should your system experience problems outside of support hours which often results in added fees.
- Equipment fees. Are you sure that your new POS -based inventory solution includes those barcode readers, or will those come at an extra cost? Is it a locked-in system that requires you to purchase additional hardware to run properly?
- Subscription fees. Many free POS systems come with software that runs free for a small amount of time on a trial basis. Things are great for a while until the trial ends when you must then decide if you will pay to play for access to certain (or all!) essential POS functions.
- Transaction fees. This is one of the sneakiest hidden costs when it comes to free POS systems. Often times, the transaction fees are not charged up until a certain threshold. Once this is reached, the transaction fees from your credit and debit card payments begin to add up. Some POS solutions offer a subscription fee to help control this cost, but any cost here means that your POS system is not actually free.
Any fees you may incur or discover over the lifetime of using a free POS system negate the initial savings you experienced by choosing a free system over a paid one that was transparent about its pricing structure. Undisclosed fees are one of the most difficult properties of a POS system to identify, due to them often being buried in a sea of legalese that a small business owner might struggle to decode. This is why it’s important for you to seek out the expertise of an experienced POS provider.
Finding the Right POS Solution for Your Business
Even if a new, free system appears as though there aren’t any strings attached, you need to take a closer look. If you expand your search to include low-investment, high-value POS systems, you’re setting your business on a much better course.
When you need to enlist the help of an expert to identify and implement a transparent POS solution, talech is here to help. We take the time to identify your business challenges and work with you to apply a solution that brings you to the top of your game. With a wide range of customizable features and flexible hardware options to choose from, you can feel confident knowing the system you’re implementing gives you the results you desire. Reach out to us today to sign up for a demo and to learn more about how talech can be your valued POS partner.