The economically advanced countries of the world generally have high levels of POS (point of sale) processing. Canada has a fairly typical level of saturation of point of sale processing. We will begin with a general discussion of point of sale processing. This will be followed by looking at the point of sale industry and what it is up to in Canada.
The concept of point of sale is to do as much transaction processing as is practical as close to the point of the transaction (sale) as is practical. Close means both close in time and close in space. In general keeping the processing close to the point of sale improves accuracy and reduces costs.
At the time and place that a shopper makes a purchase, perhaps buying clothes at a clothing store, a number of things happen. Many of them are automatically triggered, no operator action required. The invoice is created, including determining the prices of the merchandise being bought. The inventory system is informed of the purchases so the inventory can be updated. The shopper initiates payment, the payment method is checked, and the settlement of the payment is started.
Large retailers such as grocery stores began the point of sale revolution in the late 70s. As the technology improved and become more cost effective, it spread to smaller firms. Point of sale processing is very common today even in the smallest retail businesses.
Larger retailers may do much of their system development and operations internally, though even they must connect to some sort of financial institution to authorize and settle payments. The smaller retailers are very reliant on point of sale service companies.
The POS service company usually supplies the retail company with point of sale equipment that is prepared to go to work. The service company does whatever installation and configuration is needed. They provide training for the users. They are responsible for any centralized processing that is needed. They are on point when things go sideways.
Turnkey systems are very important in point of sale processing. A turnkey system is one that can be just plugged in and used, as in turns the key, such as a car or a cable box. Turnkey point of sale terminals are a key product of POS service companies.
The Canadian point of sale industry mainly comprises point of sale service companies. There are both regional and national companies that provide turnkey systems. They do some software development, but I’m not aware of any significant hardware development that they are doing.
Point of sale processing is a valuable tool for Canadian retailers. They have not lagged in implementing it, compared to other advanced countries. The POS Industry in Canada, primarily consisting of point of sale service companies, performs a vital role in making this happen.
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