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Is QuickBooks Point of Sale for You?
June 17, 2010
Right now is a great time to evaluate how you run your store. Given the current economic climate, customers are spending differently then they have in the past. With the ease of online shopping, many brick and mortar stores are feeling the pinch. It is extremely important for you to manage your cash flowand to find ways to attract new customers and keep existing customers coming back. If you don't currently have a point of sale system, or if your point of sale system can't give you all that you are looking for, you should consider QuickBooks Point of Sale.
Managing Your Cash Flow
Replace Your Cash Register With A Point of Sale System
One relatively inexpensive way to enhance efficiency is to computerize sales and inventory operations.
What do you get for your investment? Without a doubt, the biggest advantage is the ability to get an immediate, up-to-the-minute, accurate assessment of your inventory, daily, weekly and monthly sales and detailed customer information. Closing any gaps in this information will help you manage your cash flow and help you drive repeat customers who spend more.
Spend More Efficiently On Inventory
Stock too much inventory and your money is tied up. With so much money invested in your inventory, it's essential that you stay on top of it. That means that your inventory figures need to be constantly updated. Relying on a cash register or paper-based transactions does not automatically update your inventory. Retailing requires that inventory tracking occur in real-time. As you ring up sales, inventory data should be recorded and stored. Then you'll always have access to accurate, real-time information about what's selling, what's not, what you have on hand, and what you need to reorder. This new level of insight can lead to smarter decisions that help eliminate unnecessary inventory expenses allowing you to better manage your cash flow.
Don't Waste Money By Ignoring Shrinkage and Failing To Secure Against Theft.
Shrinkage is all merchandise that is taken out of stock without being paid for. Studies consistently show more people will steal if they think they can get away with it. You might not even realize that theft, whether by employees or customers, is actually going on in your store. The more items you have in your store, the more difficult it is to track all of your stock on hand. Being able to track your entire inventory, in real time, with a Point of Sale system, will help your store reduce shrinkage and not waste your valuable cash flow.
Bookkeeping Errors
A second cause of inventory shrinkage is not talked about as much, but it is an important component: unrecorded dollar fluctuations and other bookkeeping errors. We are talking about unrecorded markdowns, transfers, giveaways, damaged goods, misreading or misrecording sales and/ or receipt invoices and similar bookkeeping sloppiness. Although these may not represent an actual loss of goods, both can be very costly components in the discrepancy between book inventory and physical inventory. Unrecorded dollar fluctuations and bookkeeping errors distort your financial statement and negatively affect planning decisions.
A Point of Sale system gives you the ability to audit and review transactions, which helps you to catch any security issues affecting your profits. Additionally, it helps you to track what you have ordered and received from your vendors. Because you can readily compare the two, you can catch vendor errors and other issues that impact your costs and net profits.
Attracting Customers to Return and Enticing Them to Spend
When the economy grows sluggish and revenues begin to taper off, a retailer's first inclination may be to cut prices. Such a move can do more harm than good. A better solution is to focus on rewarding the most loyal customers, "the ones that will support you through the tough times."
Drive Extra Purchases With Promotions
Promotions and coupon offers encourage your customers to take advantage of special purchasing opportunities by spending more. Those higher spending levels boost your revenue while the advantageous pricing is boosting customer satisfaction. For example, you can drive extra purchases with promotions that offer a per-unit discount on quantity purchases, e.g., "Buy 5 of an Item for $15 Instead of $17." Another example: a small crafts shop owner creates tasteful $5 off coupons for a new line of hand-made silk bags, and when these are placed near the bags, customers find an instant incentive to purchase the bags.
A Point of Sale system tracks your customers as well as your inventory and sales. Thus, you can make good decisions about which items to special-offer at which price points. You can even reward good customers individually, because you know who they are. Promotions and coupons produce sales and extra purchases.
Loyalty Programs
The airlines know how effective frequent-flyer programs are at instilling customer loyalty. Why not launch your own frequent-buyer program? For example, many small retailers issue loyalty cards offering a free item after ten visits. Such loyalty programs help boost customer satisfaction, increase repeat business and customer retention, and generate valuable customer shopping data for later analysis.
It all sounds great as a way to nurture repeat business, but how can you administer such a program efficiently? Do you have enough information to start a loyalty program? A Point of Sale System makes tracking and analyzing customer information effortless. You always know what each individual customer is buying and when. Rewarding that customer's loyalty, whatever type of program you implement becomes a simple matter.
Know Your Customers' Needs and Meet Them
One of the worst mistakes retailers make stems from basing decisions on guessing what customers want rather than on solid evidence. Do you truly know women want the white blouse over the red one, or do you just think they do? How do you know customers prefer one soda compared to another without asking them? All such examples fall under the category of "I know best for my business."
Such certainty usually proves mistaken. Without fact-based information, you cannot maximize the amount your customers purchase.
How then do successful retailers know their customers' needs? The most important way is to track what customers buy, when they buy it, how much of it they buy and what they pay for it.
Another good way to learn about your customers' needs is to ask them. Whether it's asking customers a few questions at checkout or asking loyal customers to meet for a focus group, by learning their needs you gain deeper insight into what makes them buy.
Place Impulse-Buy Items Near Checkout for Customer Convenience
There are three reasons your customers pick up impulse-buy items as they stand in line at the register: they either want these items or they need them, or both. From large supermarkets to small convenience stores to gift shops and hardware stores, placing impulse-buy items near the register is a surefire way to boost overall sales. It may be just low-cost, "fun" items, or personal essentials, or items that your customers simply need from time to time, but they will sell near the register. The impulse items will sell, but Point of Sale helps you to maximize this important selling opportunity.
If You Are Using QuickBooks Consider An Online Store
If you are using QuickBooks or QuickBooks Point of Sale, you have the ability to fairly easily set up an online store with real time synchronizationwith QuickBooks and QuickBooks Point of Sale. You don't have to be a computer guru to create your own website and store. Through Intuit's Marketplace, third party providers have online store solutions that can quickly help you get a web presence.
If you have any questions, please feel free to contact our office. We would love to help you.
by: Dan K. Kloha, CPA
