Point of sale (POS) systems are more than just credit card processors. They are integral systems which include both hardware and software to process payments, track consumer behaviors, and even help to manage your inventory. POS equipment also comes with a wide range of options and capabilities to fit the needs of different operations. What might be more than enough horsepower for some businesses, may not meet the demands of more complex industries.
POS systems are all but mandatory for most small businesses, but the question becomes: should I rent or should I purchase my POS system? While there are certainly benefits to both sides of the equation, the best place to start is to review the basics. With this in mind, here are some high-level considerations before you choose to rent or to own your next POS system.
What is a Point of Sale (POS) System?
The “point of sale” is exactly what it sounds like it would be: the moment at which goods and/or services are exchanged for payments. Payments might include cash, credit cards, debit cards, EBT, etc. and they would still be considered a point of sale. There is a common misconception that point of sale systems only deal with electronic payments. This is simply not the case.
POS hardware is the machinery and interface with which merchants accept and process payments. Hardware might include screens, a cash register, a scanner, a chip reader, and more. Many businesses choose hardware based on power, functionality, and ease of use for consumers and for cashiers.
POS software is extremely diverse, and may include inventory management systems, payment processing systems, consumer behavior reports, and innumerable apps. Systems like Clover deliver all of these capabilities in one curated package which can be customized by users.
The Advantages of Renting POS Systems for Small Businesses
So what are the arguments for renting a POS system? Here are a few advantages which lead the majority of small business owners to rent their point of sale system:
The up-front cost of getting off the ground is lessened. It is a well-known fact that the number one reason most businesses fail is lack of start-up capital combined with underestimating operational costs. It therefore, stands to reason that any chance to cut up-front costs is beneficial for new or expanding businesses.
Renting POS systems allows businesses to remain flexible. In order to get the most bang for your buck, purchasing a POS system is a long term investment. In other words, it is a commitment to locking into a technology which may become outdated in the near future.
Renting POS systems come with tech support and lower risk. Running a small business is inherently risky. Renting a POS system takes some of the responsibility and puts it back on the POS provider if and when something goes wrong.
POS companies often provide security considerations as well. As a continuation of the previous point, POS systems which are rented generally come bundled with security software. This is yet another way to keep overhead (and risk) low.
Purchasing POS Systems Saves Money in the Long Haul
Now that we have reviewed some of the reasons for renting a POS system, what are the counterpoints on the purchase side? The reasons may not be as plentiful, but there are still some major benefits for those companies who prefer high customization and control of their sales and tracking systems.
Owning your POS system allows for unparalleled control. This isn’t to say that rent agreements are necessarily limiting, but there is no question that owning your own hardware allows businesses to build their POS infrastructure exactly how they would like. This includes using native apps, third-party apps, and even purchasing/utilizing third-party hardware add-ons.
Investing in purchasing a POS system offers cost savings over time. Where renting is ideal for limiting overhead costs for a burgeoning business, purchasing POS system(s) will save your organization money in the long run. This savings increases the longer you are able to continue to use the same system and upgrade the peripherals.
You are not tied to a contract. Buying your POS system may require a larger investment, but it also gives your organization 100% control as to when you are ready to make an upgrade to a new system. Renting a POS system may come with a contract that may limit your options.
True Merchant Offers a Full Suite of Merchant Services for Businesses
True Merchant is proud to offer both point of sale (POS) and Enterprise Resource Planning (ERP) solutions for businesses of all sizes. With our focus on merchant services and secure payment processing, POS and ERP systems are a natural extension of our other features such as CardSecure, EBT Payment Processing, and much more. With True Merchant, you can rest assured that you will be getting the best available price thanks to our complimentary rate reviews.
If you are considering a POS system for your business, please feel free to contact us by calling 1-888-770-2018 or through our online email form. A qualified merchant service professional will be waiting to walk you through the process!