Before delving into the intricacies of a Point of Sale System, it is imperative that one must first have a clear understanding of what the system is designed for – the Point of Sale.

Basically, the Point of Sale or Point of Service (also known as POS / PoS), is the place where a business transaction, particularly a sale, takes place. It could be at the checkout counter of a retail store or the cashier in a restaurant, hotel or other retail enterprise. Having established that, a Point of Sale System is the equipment or set of equipment used to formalize the retail transaction made at the point of sale. These can be as simple as an abacus and a sheet of paper (to serve as the receipt) or as technical as a wireless scanner attached to a cash register. The term POS is also used to describe the computer program (hardware and software) installed and used for checkouts.

There are two kinds of POS systems: one designed for retail operations such as stores, boutiques and the like; and another for hospitality-based businesses such as restaurants, bars, hotels and casinos. POS for retailers are simpler in structure than POS designed for the hospitality industry, which usually has, more functions.

POS systems first entered the mainstream in the first half of the 20th century, after modifications and improvements were made on standard mechanical cash registers such as the crank-operated NCR and the lever-operated Burroughs registers. Computer driven registers as well as POS systems with bar code readers were, surprisingly, introduced as far back as the 1970’s.

The 1980’s ushered in a new era of POS systems. With the proliferation of plastic money or credit cards, new mechanisms had to be developed – equipment that could process credit card verifications efficiently, safely and securely. Since then, POS systems evolved and it still is evolving at an alarming pace. To date, there are POS systems that are capable of processing multiple transactions and/or applications, integrating various functions from verification of credit cards and gift cheques, to processing of payments and issuance of receipts. These devices no longer just keep a record of sales, these can also help businesses keep track of their inventories and assist management in diverse tasks such as accounting and payroll.

POS Systems, whether these come in the form of actual machines and equipment, software applications or a combination of both, are some of the most powerful and integral tools in the retail industry. Almost all retail establishments, irregardless of shape, size and structure, are equipped with a POS system in one form or another. It is impossible to imagine any business, no matter how small, to survive in today’s highly competitive environment without such valuable tools of the trade.