Magazine Article | June 19, 2012

Retailers Open Up To Mobile POS

By Brian Albright, Business Solutions magazine

Tablets and integrated payment solutions should be the focus of the channel.

When it comes to retail software, one of the key questions many merchants are asking has to do with hardware — namely, what role tablet computers will play at the point of sale and how these devices can be integrated with existing POS systems. For resellers and integrators, tablets likely represent a new opportunity for add-on hardware sales, as well as a chance to provide consulting and networking services to clients who need guidance as to how to leverage these new devices.

“Retailers want to know how to use tablets,” says Michael Gebb, president of Specialized Business Solutions. “The market is really in flux right now. Do you need a specialized tablet for POS or an offthe- shelf model? Do you want a 7-inch or a 10-inch model? Price points are all over the place.”

While a handful of retailers are considering moving from traditional POS terminals to an all-tablet strategy, Gebb says this is the exception rather than the rule. Retailers considering a wholesale replacement of POS terminals with tablets are smaller, specialty shops like high-end shoe stores where the sales associates work one-on-one with the customer. “For stores where you go in and the customers pick up items from the shelf and buy them, it won’t work as well,” Gebb says. “The customer might not know where to go to ring up the sale if you have floating associates who ring up merchandise. It can be confusing and frustrating.”

Tablets can complement traditional POS stations by enabling line-busting applications and providing sales associates on the floor with wireless access to inventory, pricing, and product information. “Tablets are really an add-on, which is nice for resellers,” he says. “You can upsell another piece of equipment along with the services that go along with showing the client how to properly use that equipment in a store.”

But any type of mobile POS still presents a payment processing security challenge. “With mag stripe cards you have to worry about the security of the swipe and the Wi-Fi security,” Gebb says. “You need end-to-end encryption on the device.”

And remember, not everyone pays with a credit card. “How are you going to receive cash without a cash drawer?” Gebb says. Some stores have wireless connected tablets to cash drawers on traditional terminals, but even that can lead to unforeseen issues. “One of our dealers set up one of those systems and found that when you hit the cash key on the tablet, the cash drawer at the other end of the store popped open,” Gebb says. “They had to reconfigure the solution, but it was something they hadn’t first anticipated.”

Secure, Integrated Payment Solutions
Another trend Gebb believes is having significant ramifications on the channel is that more retailers are turning to integrated payment processing solutions at the terminal. This is not only convenient for retailers and their customers, but provides a value-add for resellers.

Gebb explains, “Retail customers get faster service, sales clerks aren’t bumping into each other to get to a shared credit card terminal, and the retailer has one less thing to deal with.”

The payment function is a natural part of the POS system, and using separate payment terminals is just “illogical now that reliable and secure technology is available,” Gebb says. And in most cases, merchants actually save money by switching to an integrated payment solution, which provides an opportunity for POS dealers to add value.

Gebb adds that PCI compliance remains challenging for both resellers and merchants. End-to-end encryption and tokenization make the process much easier, because card data is removed from the POS system altogether. “You can now isolate the payment process,” Gebb says. “And tokenization is available where, even if you have an encrypted stream going through, the merchant can do add-on sales, voids, and other things like that with a standard credit card slide. The technology has been around a long time, but only recently have all the parts really become available.”