How Much Does A POS System Cost? (2023 Price Guide)

The Guide to SaaS POS Retail system cost for Retailers

For most retail businesses today, the point of sale (POS) system is the command center that empowers you to manage store inventory, assist customers, process payments, and keep your business running smoothly.

But when it comes to choosing a POS system, one size does not fit all, and neither does the price tag.

Shopping for a POS system can sometimes feel like navigating a maze of hidden costs, setup fees, and pricing ambiguity. It's not always easy to discern exactly what you're signing up for.

In this guide, we are taking a deep dive into all of the factors into the cost of a POS system and why it’s essential for retailers. We’ll also discuss how much does a POS terminal and required hardware cost? What exactly you should be looking for when picking the right POS software, add-ons, processing fees, and a lot of other things you might not have thought about.

Top Three Factors Affecting the Cost of a POS System

Now, let's talk about the factors that can sometimes turn the retail POS system cost into a bit of a puzzle. Think of these factors as the ingredients in a recipe – each one adds its own flavor to the final dish.

First off, there's the hardware. Just like how a chef needs quality knives and pans to cook a great meal, a retail business needs reliable hardware for its POS system. The type of terminals, printers, scanners, and other equipment you choose can all impact the overall cost.

Next, we have software. It's the digital brain behind the operation. The software you pick can vary in price, depending on what it can do for your business. Some are like a simple recipe app, while others are more like a professional chef's toolkit, with all the gourmet features. So, understanding what you need is essential to avoid overspending.

But there's more to consider. Additional features likeloyalty programs,advanced reporting, and integrations with other tools can sometimes add to the bill. It's a bit like adding extra toppings to your pizza – each one comes at a cost. So, understanding these factors is like knowing exactly how many toppings you want before you order. It can save you from surprises at checkout.

 #1: Retail Software Costs

Think of the software as the operating system of your computer – it's what makes everything run smoothly, from managing sales and inventory to keeping track of customer data.

 The significance of POS software cannot be understated. It's the brains behind the operation, allowing you to ring up sales, keep track ofinventory levels, and even understand your customers' preferences. Just like choosing the right software for your computer, selecting the right POS software can make a world of difference in how efficiently your business runs.

SaaS vs Purchase Model

When it comes to pricing, POS software offers two main models: SaaS and purchase.

SaaS is like leasing a car. You do not own the software, but you have a license to use it for a monthly fee. The software vendor is responsible for hosting, support, software updates, and other services. This might be a lower investment (especially up-front) and more flexible option, but you do not have the same control or ownership as you would with purchase.

Purchase is like buying a car. You own the software outright and can do whatever you want with it, which includes continue to use even when you no longer chose to pay for any additional ongoing services. However, you will also be responsible for all of the costs associated with owning the software, such as hosting, support, and software updates. This is a more expensive upfront option, but you have more control and ownership over the software.

Understanding these different pricing models is crucial because they can significantly impact your overall POS software cost.  Depending on the software you chose, some offer only SaaS options, and some will offer the flexibility of both options, allowing you to choose what makes the most sense for your business.

 #2: Retail Hardware Costs

A Point of Sale (POS) system relies on essential hardware components to operate effectively. When it comes to determining the cost of POS hardware there are a number of components involved.

First off, we have computer terminals.

These are like the workstations in an office – they're where your cashiers or sales associates interact with the system. The number of terminals you need depends on the size of your business, and the features can vary as well.  For example, having a touch screen at your point of sale can be a more costly unit.

Next, we have the POS peripherals.

In addition to the workstation, you'll also need a variety of peripherals to process sales. These include printers, scanners, cash drawers, and credit card devices.

The quality and speed of these peripherals can vary, so it's important to choose the ones that are right for your business. For example, a basic printer may be sufficient for a small business, but a high-speed printer with a long range may be necessary for a larger business.

Similarly, a basic scanner may be sufficient for scanning barcodes, but a driver's license scanner may be necessary for businesses that need to scan ID cards.

The hardware you choose can significantly impact your overall POS hardware cost. It's all about finding the right balance between what your business needs and what fits within your budget.

Pro Tip: 

Depending on the POS software you choose, you might have less expensive hardware options available. If you already have POS hardware, your new POS software might function just fine on your existing hardware.  Or, if your new POS software is mobile friendly, you can choose to purchase tablets and mobile peripherals, which tend to be much less expensive than traditional workstations!

#3: Additional Costs to Consider

There's more to the cost of a Point of Sale (POS) system than just hardware and software. Think of these additional costs as the sometimes what might be considered the hidden fees in your phone bill – they can add up, but you need to be aware of them to budget effectively. This includes:

• Setup and Installation Costs: Think of this as moving into a new home. Setting up your Point of Sale (POS) system involves installation and configuration, which may require technical expertise and might come at an additional cost. Many times, these fees can be included within your monthly SaaS payment, if you go the subscription route.

• Data conversion: If you are switching from a prior POS system, you might need to convert your data to the new system. This can be a time-consuming and expensive process, depending on the amount of data you need to convert. Some POS systems offer data conversion services as part of their plans, while others may charge a separate fee.

• Employee Training: Just as you would train a new team member at your store, your employees will need training to effectively use the POS system. Training costs can vary based on system complexity and how many hours or days of instruction are needed.  Depending on the vendor, these up-front fees can also sometimes be rolled into your monthly payments to help alleviate your up-front investment.

• Customizations: Similar to tailoring a suit, retailers often desire software customizations to align the POS system with specific business needs. Customizations can enhance performance but will come with added costs.  Your retail software partner can review your request, scope out the development project, and provide you with an estimate for the work which would be based on the complexity of the modification.

• Integration: This is like connecting different apps on your smartphone. Integration allows your POS system to work seamlessly with other software, such as accounting software or sales tax automation, or perhaps distributor integrations or merchandise planning software.  Integrating with 3rd parties like this can entail additional expenses as well.

• Ongoing Maintenance Costs: Much like maintaining a car, your POS system needs regular updates, maintenance, and sometimes repairs. These ongoing costs should be factored into your overall POS system budget.  With a monthly SaaS subscription, these fees are typically already included in your monthly cost.

• eCommerce Integration: If you sell products online, you will need to integrate your POS system with your eCommerce platform. This allows you to manage inventory, orders, customers, and payments across all channels. You will need to ensure your POS provider is capable of integrating to your eCommerce provider, or you can choose a single technology provider who offers both.

• Add-On Services: Some businesses opt for services like email marketing, SEO (Search Engine Optimization) for their website, or content marketing to boost their online presence and attract more customers to their physical stores. These services offer tremendous marketing benefit, but of course come with their own price tags.

Payment Processing Fees

Payment processing fees are an unavoidable part of running a retail business that accepts credit cards or other forms of electronic payments. These fees can vary depending on the type of payment, the merchant's location, and the volume of transactions.

It's important to factor in these fees when budgeting for your POS system, as they can have a significant impact on your bottom line.

Payment processing fees can be categorized into three main types:

1. Transaction Fees: These are incurred every time a payment is processed. They can be a fixed amount per transaction or a percentage of the total sale.

2. Interchange Fees: These fees are set by credit card companies like Visa and Mastercard. They vary depending on factors like card type, transaction method, and risk level.

3. Processing Rates: They're usually charged as a percentage of the transaction amount, and they may include a flat fee per transaction as well.

It's essential to consider these fees when budgeting for your POS system. While integrated payment processing offers convenience, it's wise to understand how the fees associated with it may affect your business's financial health.

Scalability and Growth of Your Business

Imagine you're setting up a garden. You start with a small patch, but you want it to flourish over time. Well, just like your garden, your business can grow, and your Point of Sale (POS) system needs to keep up with that growth.

Scalability is a bit like planting seeds. It's the ability of your POS system to expand and handle more as your business flourishes. A scalable POS system can grow alongside your business.

But why is scalability important? Imagine your garden starts growing. You wouldn't want to dig up everything and start from scratch. Similarly, having a scalable POS system means you won't have to overhaul your entire setup as your business expands. It's about being prepared for the future.

When budgeting for a POS system, consider your business's potential for growth. It's like planning for more flower beds in your garden as you anticipate your plants thriving. Investing in a scalable solution may cost a bit more upfront, but it can save you significant headaches and expenses down the road.

 How Much Does a POS System Cost?

Pricing can vary greatly between retail systems, for all of the reasons we discussed above.  There are simple systems available in which you can get started quickly and at a low cost, and then there are much more advanced systems out there which can take more time and come with a higher investment.

At Celerant, we offer two different systems; one at a lower price point and one with more advanced features which comes as such at a higher cost. Cumulus Retail by Celerant is a SaaS Retail POS System that is available in scalable versions to support you now, and as you grow your retail business, in store and online.

Stratus Enterprise by Celerant, is a more comprehensive system designed for advanced retailers or those with a need to customize the software to meet the needs of their business.

Here's a breakdown of where the pricing starts for the Cumulus Retail POS system by Celerant:

As with most all SaaS POS software solutions, you can add on additional POS and/or office users as needed. You can also add on services such as integrated shipping, making it easy to print your packing slips and shipping labels for online orders, all in one step at within the software. There are lots of options that are available to help your business automate and streamline your operations.  It’s a matter of you reviewing all of what is available, deciding what works best for your business, and then determining your ongoing costs from there. 

Pro Tip: 

Retailers can start small and add-on as you go. Many start with the POS software and after they are live, they add eCommerce and additional features and/or integrations.  It’s important you determine which features are vital for your business, and you start with those.  Then, you can determine which to add on later, once you are more comfortable with your new system and ready to do more.

Think Long-term When Choosing a POS System for Your Business

Before you purchase a POS system, take the time to evaluate the pros and cons of buying a subscription to a certain POS software. This can help you make an informed decision about whether the investment is worth it for your business.

After all, a well-planned and well-implemented POS system can be a valuable asset in your quest for retail success.

Key Takeaways

The cost of a POS system is more than just what you see on the invoice. It's about understanding everything about the hardware, software, and additional expenses. You need to be aware of the setup, training, and ongoing maintenance costs, and how well a POS system is designed for future growth and scalability.

As you consider implementing a POS system for your business, we encourage you to take these key takeaways to heart:

1. Evaluate Your Needs: Understand your business inside and out. What are your specific requirements, both now and in the future? This clarity will guide your choices.

2. Consider All Factors: The true cost of a POS system includes hardware, software, additional expenses, and potential add-on services. Don't overlook these important elements.

3. Plan for Scalability: Think beyond the present. A scalable POS system can adapt as your business grows, saving you from costly overhauls.

Take your time, explore your options, and choose wisely. Your POS system isn't just an expense; it's an investment in efficiency, customer satisfaction, and the growth of your business.

If you are interested in exploring your options at Celerant, our team is always happy to assist.