Bernie Winter, Director of Point-of-Sale Systems at Tops brings 30 years of experience in the POS industry and is responsible for managing and supporting all the self-checkout and point of sale solutions at the company's retail supermarkets. Mike Metz, Vice President of Information Technology at Tops, oversees all business areas, including retail, marketing, and merchandising, and has over 40 years of experience with Tops.
In an interview with Retail CIO Outlook, Winter and Metz speak on the trends, and recent developments in the POS landscape at Tops and how going mobile is key to the future of POS. They share a detailed account of how the dynamic POS industry has evolved over the years in accordance with customer needs and continue to evolve and adapt to emerging trends.
"From simple manned checkout lanes to self-checkout, electronic payments enabled by POS, to mobile payment, today everything is interchangeable and interconnected"
How has the POS landscape evolved over the years?
Winter: Over the years, the POS industry has witnessed significant hardware improvements that provide greater processing power to POS devices. From what started as a s imple cash register, POS has evolved over the years to manage not only the front-end processes at Tops but also back-end systems while providing the data and financials to handle these functions. The improvements in POS software have also made it flexible to adapt to the changing demands of the customers. From simple manned checkout lanes to self-checkout, electronic payments enabled by POS, to mobile payment, today everything is interchangeable and interconnected. The growth of e-commerce has also given customers the flexibility to order products online and have them delivered to their doorstep or even pick it up at the nearest store.
Metz:The introduction of UPC scanning opened the doors to additional opportunities. The first was accuracy and speed at the front-end. Secondly, with inventory reports and the data within the POS systems, retailers gained the capability to determine product demand. On the other hand, transaction logs were used for multiple purposes like computer-assisted ordering (CAO), analytics, shelf space allocation, price optimization, and promotion. The POS industry has evolved by leaps and bounds to a point where a customer can walk into a store (Amazon GO,) pick what they need, and walk out—all in a fast, convenient, and completely contactless way. Additionally, in the age of COVID-19, being able to offer Tops' customers the convenience and safety of contactless payment and shopping with our Shop and Scan App has been paramount.
What are some of the technological trends emerging in the POS market?
Winter: The most significant trend we noticed in recent times is meeting customers' demands. Customers are looking for a contactless experience, and services like mobile shopping with our Tops Shop and Scan App, self-checkout, and home delivery have become increasingly popular. With self-checkout, customers can walk into the store, select what they need, scan the products right on their own phones, and check out. This ensures they are not coming in contact with any other person and reduces the time they spend within the stores. Mobile shopping and doorstep delivery services are incredibly convenient for customers who have had a l ong working day and don't want to spend time shopping and buying products inside a s tore. Delivery is also an added convenience for those who are in our senior population and may have difficulty getting to Tops during the winter months or may have concerns about shopping due to COVID.
Metz: The pandemic has dramatically changed our way of thinking and business direction on a dime. Many of us had to pivot and adjust to the new conditions enforced by the pandemic. Over the last year, online transactions have grown twofold, and this was expedited further by the pandemic, where many businesses had to shut down their physical stores, but were able to continue operations online.
What are some of the major pain points in the POS space?
Winter: From implementing network controls to having the right f irewalls in place, POS security has always been challenging. Retailers have to ensure that they are meeting the PCI compliance standards to protect themselves and the customers. Data accuracy is another pressing concern for retailers. It is important to deploy trustworthy solutions after rigorous testing. Before implementation, retailers should ensure that the data collected by the solution is accurate, the system is user-friendly, and the staff is well-trained in operating the systems. While the senior population often prefer to shop the traditional way, the younger generation wants to leverage all the technology available to them. The trick is to strike the right balance between the two and align with the needs of both demographics.
Metz: A P OS system is like an investment in your organization. But for small and medium retailers, it can be challenging to bear the costs and cope with the changes in demands, especially during the pandemic. With the advent of numerous vendors with thousands of products, the challenge lies in integrating each of the products into the POS system. We cannot rely on a o ne size f its all approach and there is a significant amount of integration effort required to add a particular function or feature to a P OS system from a third party.
What practices should businesses adopt to steer ahead of the competition?
Winter: When we talk about POS, cheap is not always better. It is better to invest in a trusted solution that is flexible and scalable. In this regard, understanding our customers and their needs is important to implement the right products in the store and offer them the shopping experience they like. Having a hardware-agnostic solution is critical to operating multiple systems instead of having to overcome limited software access. Above all, retailers should always be aware of the emerging trends and be prepared to capitalize on them.
Metz: Small and medium-sized retailers cannot always afford to invest in the most leading-edge technology on the market. It is better to let the bigger companies invest and implement the latest solutions on the market and work out the kinks. In many cases, we see the larger corporations introducing new solutions across a few stores and then discontinuing them six months later because they did not fit the bill. These are not mistakes that a smaller retailer can afford to make. At the same time, it is important to keep an eye out for the emerging trends and listen to customers, store managers, and store associates because they have their ears to the ground and know what our customers like and dislike.
What is your advice to budding entrepreneurs in the industry?
Winter: Always stay up to date with technology and attend important conferences and conventions like the NRF. Keep an open mind because the retail environment is rapidly changing and you need to be able to think on your feet to adapt and grow.
Metz: Going by the age-old adage: "you never get a second chance to make a f irst impression," I w ould say it is best to thoroughly vet any solution you consider and test it as many times as possible before implementing it. Make sure that the solution works and performs the way the customer expects it to. Closely observe your competitors, but stay true to your mission and always keep your finger on the pulse of the industry.