Point of sale

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Point of sale (POS) (also sometimes referred to as Point of purchase (POP) ) or checkout is the
location where a transaction occurs. A "checkout" refers to a POS terminal or more generally to
the hardware and software used for checkouts, the equivalent of an electronic cash register.
A POS terminal manages the selling process by a salesperson accessible interface. The same
system allows the creation and printing of the receipt.
Contents [hide]
1 History
1.1 Early software (pre 1990s)
1.2 Modern software (post 1990s)
1.3 Hardware interface standardization (post 1990s)
1.4 Web based POS (post 2000s)
2 Industry
2.1 Retail industry
2.2 Hospitality industry
2.2.1 Restaurant business
2.2.2 Hotel business
3 Checkout system
3.1 Checkout hardware
3.2 Checkout software
4 Accounting forensics
4.1 Tax fraud
5 See also
6 References
[edit]History

[edit]Early software (pre 1990s)

Early electronic cash registers (ECR) were controlled with proprietary software and were very
limited in function and communications capability. In August 1973 IBM announced the IBM 3650
and 3660 Store Systems that were, in essence, a mainframe computer packaged as a store
controller that could control 128 IBM 3653/3663 point of sale registers. This system was the first
commercial use of client-server technology, peer-to-peer communications, local area network
(LAN) simultaneous backup, and remote initialization. By mid-1974, it was installed in Pathmark
Stores in New Jersey and Dillard's Department Stores.
The first microprocessor-controlled cash register was built by William Brobeck and Associates in
1974, for McDonald's Restaurants. Each station was controlled by an Intel 8008, a very early
microprocessor. There was one button for every item -- for example [2 Vanilla Shake], [1
Chocolate Shake], etc. By pressing the [Grill] button, a second or third order could be worked on
while the first transaction was in progress. When the customer was ready to pay, the [Total]
button would calculate the bill, including sales tax. This made it accurate for McDonald's and very
convenient for the servers. Up to eight stations could be interconnected and printed reports,
prices, and taxes handle from a single station in "Manager Mode."
Programmability allowed retailers to be more creative. In 1979 Gene Mosher's Old Canal Cafe in
Syracuse, New York was using POS software written by Mosher that ran on an Apple II to take
customer orders at the restaurant's front entrance and print complete preparation details in the
restaurant's kitchen. In that novel context, customers would often proceed to their tables to find
their food waiting for them already. This software included real time labour and food cost reports.
In 1986 Mosher used the Atari ST and bundled NeoChrome paint to create and market the first
graphical touchscreen POS software
[edit]Modern software (post 1990s)
In 1992 Martin Goodwin and Bob Henry created the first point of sales software that could run on
the Microsoft Windows platform named IT Retail.[1] Since then a wide range of POS applications
have been developed on platforms such as Windows and Unix. The availability of local
processing power, local data storage, networking, and graphical user interface made it possible to
develop flexible and highly functional POS systems. Cost of such systems has also declined, as
all the components can now be purchased off-the-shelf.
The key requirements that must be met by modern POS systems include: high and consistent
operating speed, reliability, ease of use, remote supportability, low cost, and rich functionality.
Retailers can reasonably expect to acquire such systems (including hardware) for about $4000
US (2009) per lane.
[edit]Hardware interface standardization (post 1990s)
Vendors and retailers are working to standardize development of computerized POS systems and
simplify interconnecting POS devices. Two such initiatives are OPOS and JavaPOS, both of
which conform to the UnifiedPOS standard led by The National Retail Foundation.
OPOS (OLE for POS) was the first commonly-adopted standard and was created by Microsoft,
NCR Corporation, Epson and Fujitsu-ICL. OPOS is a COM-based interface compatible with all
COM-enabled programming languages for Microsoft Windows. OPOS was first released in 1996.
JavaPOS was developed by Sun Microsystems, IBM, and NCR Corporation in 1997 and first
released in 1999. JavaPOS is for Java what OPOS is for Windows, and thus largely platform
independent.
There are several communication protocols POS systems use to control peripherals. Among
them are
EPSON Esc/POS
UTC Standard
UTC Enhanced
AEDEX
ICD 2002
Ultimate
CD 5220
DSP-800
ADM 787/788.
There are also nearly as many proprietary protocols as there are companies making POS
peripherals. EMAX, used by EMAX International, was a combination of AEDEX and IBM dumb
terminal.
Most POS peripherals, such as displays and printers, support several of these command
protocols in order to work with many different brands of POS terminals and computers.
[edit]Web based POS (post 2000s)
Web based POS software can be run on any computer with an Internet connection and supported
browser, without additional software. The POS software is hosted on secure servers in multiple
data centers with real-time backups.[citation needed]
[edit]Industry

[edit]Retail industry
Main article: Retailing
The retailing industry is one of the predominant users of POS terminals.
A Retail Point of Sales system typically includes a computer, monitor, cash drawer, receipt
printer, customer display and a barcode scanner, and the majority of retail POS systems also
include a debit/credit card reader. It can also include a weight scale, integrated credit card
processing system, a signature capture device and a customer pin pad device. More and more
POS monitors use touch-screen technology for ease of use and a computer is built in to the
monitor chassis for what is referred to as an all-in-one unit. All-in-one POS units save valuable
counter space for the retailer. The POS system software can typically handle a myriad of
customer based functions such as sales, returns, exchanges, layaways, gift cards, gift registries,
customer loyalty programs, BOGO (buy one get one), quantity discounts and much more. POS
software can also allow for functions such as pre-planned promotional sales, manufacturer
coupon validation, foreign currency handling and multiple payment types.
The POS unit handles the sales to the consumer but it is only one part of the entire POS system
used in a retail business. “Back-office” computers typically handle other functions of the POS
system such as inventory control, purchasing, receiving and transferring of products to and from
other locations. Other typical functions of a POS system are to store sales information for
reporting purposes, sales trends and cost/price/profit analysis. Customer information may be
stored for receivables management, marketing purposes and specific buying analysis. Many retail
POS systems include an accounting interface that “feeds” sales and cost of goods information to
independent accounting applications.
[edit]Hospitality industry
Main article: Hospitality
Hospitality point of sales systems are computerized systems incorporating registers, computers
and peripheral equipment, usually on a computer network. Like other point of sale systems, these
systems keep track of sales, labor and payroll, and can generate records used in accounting and
book keeping. They may be accessed remotely by restaurant corporate offices, troubleshooters
and other authorized parties.
Point of sales systems have revolutionized the restaurant industry, particularly in the fast food
sector. In the most recent technologies, registers are computers, sometimes with touch screens.
The registers connect to a server, often referred to as a "store controller" or a "central control
unit." Printers and monitors are also found on the network. Additionally, remote servers can
connect to store networks and monitor sales and other store data.
The efficiency of such systems has decreased service times and increased efficiency of orders.
Another innovation in technology for the restaurant industry is Wireless POS. Many restaurants
with high volume use wireless handheld POS to collect orders which are sent to a server. The
server sends required information to the kitchen in real time.
[edit]Restaurant business
Restaurant POS refers to point of sale (POS) software that runs on computers, usually touch
screen terminals or wireless handheld devices. Restaurant POS systems assist businesses to
track transactions in real time.
Typical restaurant POS software is able to print guest checks, print orders to kitchens and bars
for preparation, process credit cards and other payment cards, and run reports. In addition, some
systems implement wireless pagers and electronic signature capture devices.
In the fast food industry, registers may be at the front counter, or configured for drive through or
walk through cashiering and order taking. Front counter registers take and serve orders at the
same terminal, while drive through registers allow orders to be taken at one or more drive through
windows, to be cashiered and served at another. In addition to registers, drive through and
kitchen monitors may be used by store personnel to view orders. Once orders appear they may
be deleted or recalled by "bump bars", small boxes which have different buttons for different
uses. Drive through systems are often enhanced by the use of drive through wireless (or headset)
systems which enable communications with drive through speakers.
POS systems are often designed for a variety of clients, and can be programmed by the end
users to suit their needs. Some large clients write their own specifications for vendors to
implement. In some cases, POS systems are sold and supported by third party distributors, while
in other cases they are sold and supported directly by the vendor.
Wireless systems consist of drive though microphones and speakers (often one speaker will
serve both purposes), which are wired to a "base station" or "center module." This will, in turn
broadcast to headsets. Headsets may be an all-in-one headset or one connected to a belt pack.
[edit]Hotel business
POS software allows for transfer of meal charges from dining room to guest room with a button or
two. It may also need to be integrated with property management software.
[edit]Checkout system

A Checkout in a Guatemalan supermarket.

A checkout system generally involves the following components:
General computer hardware
General computer software
Checkout hardware
Checkout software
Miscellaneous store hardware
Because of the expense involved with a POS system, the eBay guide recommends that if annual
revenue exceeds the threshold of $700,000 per annum, investment in a POS system will be
advantageous.[2]
POS systems are manufactured and serviced by such firms as Fujitsu, IBM, MICROS Systems,
Panasonic, Radiant Systems, Sharp, Squirrel Systems, and Vectron POS among others (see the
point of sale companies category for complete list).
Point of sales systems in restaurant environments operate on DOS, Windows or Unix
environments. They can use a variety of physical layer protocols, though Ethernet is currently the
preferred system.
[edit]Checkout hardware
Specific to the POS industry, generally including:
USB Credit card reader
USB Receipt printer
Cash drawer
USB Barcode scanner
USB PIN pad with Integrated Card Swipe
Stands on which the payment devices are held/mounted/posted
[edit]Checkout software
Top software, based on U.S. Install Base:
Radiant/Aloha: 24%[unreliable source?]
Internally Developed: 15%
MICROS: 14%[3]
[edit]Accounting forensics

[edit]Tax fraud
Main article: Automated sales suppression device
POS systems record sales for business and tax purposes. Illegal software dubbed "zappers" is
increasingly used on them to falsify these records with a view to evading the payment of taxes.
[edit]See also

POS display
Retailing
Self-checkout
EFTPOS
UnifiedPOS
JavaPOS
ISO 8583
Secure POS Vendor Alliance
Standard Interchange Language
Supply chain attack
Point of sale companies category
[edit]References

^ Kaplan, Karen. "Do-It-Yourself Solution: Small Grocery Chain Has Big Plans for Its Retailing
Software", "Los Angeles Times", November 29, 1995, accessed December 10, 2010.
^ "Point of Sale (POS) Systems Buying Guide". Retrieved 2009-07-23.
^ Source: Chain Store Guide 2004 Market Study of FoodService Technology - Top 768 chains,
counted by Company
Categories: Banking terms and equipment | Retailing | Electronic commerce | Embedded systems
| Payment systems | Banking technology | Retail POS systems | Business software
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