
Article
How to Select a Restaurant Point-of-Sale System
Look at how you do business today, and perhaps more importantly, how you would like to do business going forward, and write down those key functions you would like your POS system to perform.
Today's POS is a much more sophisticated and powerful tool than in the early days of the technology, and as a result, there are many considerations to review prior to selecting one for your restaurant.
So how do you gauge how good the POS provider is at service and support? Ask for five current restaurant references and pick 2-3 to call. Ask them specifically about how good the level of support is, how responsive their service has been, and whether they feel like they are getting the level of support they need to effectively run their business.
While the world of restaurant technology has continued to evolve and specialize, the core of restaurant auto- mation continues to be the Point-of-Sale or POS system. Since research and doing your homework up-front will lead to a more educated decision and a much better solution for your restaurant, we have highlighted key areas of review and differentiation to help you know what to look for.
Brief History of POS
Point-of-Sale systems in restaurants and retail can be traced back to the early-to-mid 1970's when they were primarily designed to allow a cashier to ring up a transaction and apply a payment against it. The goal was purely accounting-based and provided a very basic reconciliation of sales by department based on pre-set transaction codes to report payment methods.
As time went on, the systems moved to being more sophisticated, with the ability to program menu buttons to identify specific products or items (normally referred to as PLU-Price Lookup, or SKUs) and provide greater tracking and reporting of users and other key data. While the functionality continued to expand, the primary goal remained sales and payment reconciliation. Over the last few years, POS systems have expanded their functionality significantly and can now allow the customer more ways to order, pay for the meal, be rewarded for their purchase, make the kitchen more efficient, and improve the guest experience.
The point-of-sale systems today are more like a central transaction hub, the heart of the restaurant technol- ogy, where all transactions are created and recorded regardless of the type of transaction. There has never been a better time to be in the market for a new POS system!
POS Migrates to the Cloud
Everyone throws around the word "cloud" quite casually, but what does it mean for a POS? The easiest way to describe it is to look at other systems that are already cloud-based. Do you use Quickbooks? Do you watch any of the streaming TV services like Netflix or Hulu? All of these applications operate by connecting to them through the Internet and delivering the content from a server that is running somewhere else in the country or maybe the world.
There is little or no data locally (at your location) and everything that you see or watch is actually viewed in real-time using your Internet connection. The benefit of this design is that you do not need to purchase expensive equipment to store the program, and no need to store and secure all the associated data. In addition, as the companies further develop the software and add functionality, enhancements can be made with little impact on you. Gone are the days when every time a new piece of soft- ware was released for your PC it required a faster pro- cessor, more memory, or even more hard drive space!
While the benefit of this design is significant, there is one major downside: if you use lose your Internet connection, you lose access to the program. It may be aggravating when this happens in the middle of your favorite movie, but it can be devastating if this happens to your POS system in the middle of dinner.

The idea that your restaurant technology could stop working at such a critical time led many POS vendors to develop what is now commonly called a Hybrid-Cloud solution, where a lot of the functionality remains in the cloud (such as gift cards, promos and coupons, and payment processing) but the core "ringing" functionality can continue to occur regardless of your Internet connectivity.
We mention this key distinction because, as we'll discuss below, more and more POS vendors are moving their products and services to the cloud to be able to charge a monthly usage fee (like Netflix and Hulu). It is important for you, as the consumer, to understand how to mitigate damage from the loss of features and services that are not available without an Internet connection.
Key Features to Consider
Manage the search process for your ideal POS system like you would for any major purchase by writing down all the key functions and features you would like the system to provide. Do not start the process by asking for demos until you have clearly documented your needs and can properly articulate them to the salesperson. Your list of requirements will help you in your selection of a system that will completely service your restaurant operations. As part of this documentation, talk to your servers, cooks and your accountant. Find out what they would like to see in terms of features, data, reports, etc. To help you with this process, give some thought to the key areas highlighted below.
Architecture. As discussed above, more and more POS systems – and especially the newer more
advanced systems – are all being designed to run on a browser or what is referred to as a
thin-client. This means the restaurant typically does not need a PC or a great deal of processing
power to run the POS. There are still some very good "premise- based" POS products that do require
a server in the restaurant where the program and data reside, and based on your number of
locations and how much time you actually spend in the restaurant, this may very well be a good
solution for you. When considering which is best for you, think about the following items:
- Do I have access to good Internet service in my area, and is it highly reliable?
- Do I want to subscribe to 4g or 5g cellular service as a backup connection in the event I choose a hybrid-cloud POS solution?
- Do I have the means to secure a premise-based server in a safe location in order to avoid someone potentially damaging the equipment and causing its loss of use and data?
- Would I prefer to be able to access reports, update menus, and see general sales information remotely, or do I spend most of my time at the restaurant where I can directly access these items?
The decision whether to go with an "on-prem" or hybrid-cloud solution may also be driven by some of the other features and functions you might have on your requirements list.
Integration. Today's restaurant technology is a complex system, and the goal for any operator is to try to reduce as many manual touchpoints as possible. Third-party delivery providers like GrubHub, DoorDash, and Uber Eats will provide a tablet for you to keep in the back-of-house where orders will appear in real-time for someone to manually copy them into your POS so that the operations know there is an order to be filled. Is that really efficient?

Three tablets sitting on a table waiting for someone to notice an order has come through? Some POS systems offer direct integration into their systems for one or many of the third-party delivery providers. This way, when an order comes in, it is immediately available to the POS, and the system behaves as if the order was entered by a server. This is a huge time saver, avoids customer service issues, and saves labor. Look at the delivery providers you currently use and add direct integration to the list of services you require.
Another important area of integration is a kitchen display system or KDS. If you operate a busy restaurant, KDS is an efficient way to run your kitchen and manage the workload. Many POS systems offer a KDS module with their product, but if not, or you have an existing KDS or are planning to install one, make sure integration to the KDS is also on your requirement list.
There are a myriad of other products and tools that should be considered; loyalty systems, gift card programs, labor-scheduling, menu management, inventory, and even payroll. Think about all the data that the POS generates, who needs that information to perform their job, and whether the delivery of that data to that individual can be automated in some way. Remember, the goal is to minimize the time it takes to move data within the restaurant to the person who needs access to it, and to avoid manual touchpoints when the integrity of the data (and timeliness) can be negatively affected.
As you draft your list of integrations, think about how many of the following systems you either
operate or intend to as part of your restaurant technology plan:
- Third-Party Delivery
- Catering Systems
- Event Management
- Table Reservation Systems
- Food Safety Management Systems
- Kitchen Display Systems (KDS)
- Work Order Management Systems (WMS)
- Labor Scheduling
- Inventory Management Management
- Gift Cards
- Loyalty
- Digital Signage
- Video Surveillance
- Drive-Thru Technologies (Headsets, Timers, etc.)
- Food Locker Systems
- Restaurant Website
- Online Ordering App
Product design and function. What type of restaurant do you have, and what type of service model would you like the technology to support? If you are a table service restaurant, do you want your servers to manually write down the orders and go to a fixed terminal somewhere in the restaurant to enter the order? Would you prefer the servers had a tablet or some form of order-entry device to be able to enter the order at table-side? If you are a quick-service restaurant (QSR), do you operate a drive-thru, and do you want to do line-busting (a person outside taking orders on a tablet to get them into the kitchen quicker) to help speed up the line during busy times?
These are all product design and function considerations. Look at how you do business today, and, perhaps more importantly, how you would like to do business going forward, and write down those key functions you would like your POS system to perform. Systems often come designed specifically for one type of service or another (QSR versus fast casual versus fine dining, etc.) so be sure to assume nothing when you start your search and confirm the features you want are available in the product you select.
As you document these product and design function considerations, think of these aspects of your business:
- Do we want orders to go back to the kitchen on the KDS as soon as it is ordered, or once the entire table's order has been tendered?
- Do we give out a table tent to customers – and if so, do we need to track the table tent number in the order?
- Do we ask the server to enter the customer order by seat number – and if so, can we do that in the POS?
- Does the POS support coursing?
- How much customization of a menu item will the POS allow? Does it provide the necessary flexibility and ease-of-use for your servers to enter the order exactly the way the customer requested it?
- Does the POS system allow you to enter the evening's menu specials and indicate that there are only a fixed number of specials available, after which point the POS will alert the servers that the item is sold out?
- Does the system allow you to allocate a server to a certain section and help when seating customers to ensure that you don't overwork one server without seating any customers in another server's area?
- Does the system allow you to transfer a bar tab to a table without needing the guest to cash out, and if so, how does it handle the tip reconciliation?
As you might tell from reviewing these operational pro- cesses, the list can be extensive, and it is specific to the way you operate your restaurant. Take the time in advance to generate your list before searching for a POS.
Payment processing. Credit card payment processing is a truly complicated process. It can be complicated because of the variety of processors, payment gateways, middleware, issuing banks, types of cards, and whether the card is presented in person or given over the phone or the web. Every combination generates a different fee calculation. This makes it difficult for the business owner to determine if they are being properly charged. Additionally, some POS providers require that you use their payment processing as a condition for using their POS. This restriction has its pros and cons.

From a positive standpoint, the operator doesn't need to determine if a payment issue is a POS problem or a processing issue. If the POS provider is also the card processor, they can provide additional information about the customer or marketing services to help identify and track your best customers. On the other side of the ledger, though, the POS provider rates are not always the best rates and there were documented cases that occurred during COVID when one of the POS-credit card provider's rates were 3-4 times higher than the prevailing rates for the same type of service.
The notion that you cannot discontinue one of the services without also getting rid of the other can be a problem since you might like one of the products, but not the other. The moral of the story is to go into payment processing with your eyes open, ask lots of questions, understand your current customer credit card usage, and be prepared to shop around for the best rates. In any case, do not sign a credit card contract longer than two years since as the technology continues to evolve and you don't want to find yourself stuck in a long-term agreement. If you choose to bundle POS and credit card processing, make sure you understand the fees, ensure that they are competitive with your current fees, and understand your termination clause.
Service and support. This may be the most important aspect of selecting a POS and is often the area where most operators spend the least amount of time or thought. As a restaurant operator, it is unlikely your background is as a trained network technician or computer programmer, so it is essential that the POS provider give your organization the service and support that it needs to keep the system running smoothly and with the fewest support issues.

Be sure to understand the support model and associated costs. Get the provider to share their service level agreement document or SLA. The SLA dictates the manner and method by which they provide support, and their commitment to timeliness. It also describes what the provider considers a "critical" support call and what is not; you will want to review this and understand it so that when a POS terminal crashes and the provider is not responding in what you perceive to be a timely manner, there is an understanding of why they are responding that way.
So how do you gauge how good the POS provider is at service and support? Ask for five current restaurant references and pick 2 or 3 to call. Ask them specifically about how good the level of support is, how responsive their service has been, and whether they feel like they are getting the level of support they need to effectively run their business.
As best as possible, try to understand whether they are on the same service and support plan that
you are considering, and how long they have had that plan; don't use a reference who hasn't been
installed at least 6-9 months. Keep in mind if the POS provider is giving you these customers as
references, they are probably the happiest of their clients. Be leery if these customers are not
completely thrilled by the service. Be sure to ask questions such as:
- How long does it normally take for the provider to answer the phone?
- How often do they resolve the issue on that first call?
- How many calls does it often take to resolve the issue?
- How many issues do you have per month when you need to call for assistance?
- How professional is the support team? Are they courteous and proficient at resolving issues?
- Do you receive a monthly support call log that shows the number of calls, closed calls, and open calls?
- What things do you feel the POS provider could improve on as it relates to service and support?
If you are expecting the POS provider to service and support your hardware, be sure to understand the specifics of the service, such as what time does a service call need to be made to ensure the fastest replacement of equipment as well as all costs associated with providing the service. For instance, who pays shipping for the new POS terminal and for the return of the replacement? Understand all your costs and don't be afraid to ask "what-if" questions.
Last and Possibly Least
While it is important to find a system within your budget, price is not as important as finding a business tool that works for your business and will help your employees and overall operation be more efficient and profitable. Find the right business tool first, then focus on negotiating the best deal.
Pay particular attention to the term of the agreement, your options for early termination, and issues around who owns the data, who has access to the data, and how (and when) any contractual issues will be addressed and resolved. It never hurts to pay an attorney for a few hours of review to avoid a ew years of unhappiness, so give that some thought as well.
SEVEN STEPS TO CHOOSING THE RIGHT POS SYSTEM
Choosing a point-of-sale system isn't just an important decision, it is a critically important decision. Probably one of the biggest you make as a restaurant operator. The right POS system can literally transform your operation by improving controls, efficiency, decision-making and even sales volume. If properly chosen, a POS can pay for itself in a matter of months. However, choosing the wrong POS can become your worst nightmare.
The following steps are designed to help increase your odds of choosing the right and most appropriate POS system for YOUR restaurant.
Assemble a few good people to help you evaluate and recommend a POS system. Even if you own a small restaurant, it's usually a good idea to get a few of your people involved in the process for their ideas, insights, and buy-in. Remember, they will have to use and rely on the system too, so they don't want you making a bad decision either. It may be smart to have a server, counter person, manager, line cook, or accountant (bookkeeper) be part of the team.
POS Team should create a comprehensive list of capabilities and features they need and want in a new POS. Make a list of these features and functions, then determine which are those you can't live without and features that are optional. Optional features are the ones that would be nice, but not absolutely essential.
This can usually be done initially by phone with a representative of the POS company or dealer. Let them know that they're going to have to "show you" everything they claim in a live demo at some point. Also get a sense of the cost of the system at this point. You'll want to know upfront if a system is clearly not within your budget constraints.
Eliminate the vendors, whose systems don't meet your minimum requirements or are priced beyond your budget. Take into account years of experience, number of local installations and financial condition. Narrow the field to 2 or 3 vendors. Ask a few of their people such as the manager, servers, cashiers what they like and don't like about it.
Select 1 or 2 existing customers furnished by each vendor and observe the system operating during a busy meal period. Ask a few of their people such as the manager, servers, cashiers what they like and don't like about it. People are usually very candid and open, especially if they have had an exceptionally good experience or a really terrible one. Ask about how their installation went, how responsive the company has been to service calls, and if they would buy this system again.
A few days before the demo, give the vendor a copy of your menu. Tell them you want to have the demo conducted with a few of your menu items. Have the demonstration take place in your restaurant, not in their office. Notice how easy or difficult it is for them to get it set up and running. This is also a test to see how badly they want to sell you their system, how easy it is to install and get it operating properly in your restaurant.
Don't let the vendor conduct the demonstration. Before the demo, have a prepared script of the transactions you want to see the system handle. 8 to 12 transactions might be sufficient in most cases. For example:
Table of six comes in, they order drinks (you specify), appetizers, entrees, etc. Think of all the ways your customers modify those items. Like a steak can be ordered medium-rare with mushrooms on the side. Numerous condiments can be served with a baked potato, on the side or not. How easy will it be for the server to enter the modifications, and will the POS accommodate all the kinds of modifications you have to deal with?
What if the server presents one check to the table of six and they want separate checks? Test all of these types of situations and transactions that your people run into every day. If the vendor conducts the demo, you will see what they want to show you, what they know works. So don't let the vendor conduct the demo. During the demo, if the system doesn't perform the way you want, listen closely for the vendor's response. Are they willing to make the necessary changes? Document what they say they will do and follow-up to see that it's done to your satisfaction before you sign a contract.
Purchasing a new POS solution is like purchasing any type of product or service; there is always some room for negotiation and to "bundle" to gain value in the transaction. Don't be afraid to try and be creative in your negotiating whereby you can leverage more value in the vendor by licensing other products or services that they offer at a discount while still making the salesperson happy as well!