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Advantages of a POS system

Question:

How can I convince the already cash-strapped owners of a family bar & grill to invest in a POS system? We move and calculate all the tickets manually. The owner is "old school," and doesn't understand that we're at a competitive disadvantage.

– Farron, General Manager, Cantina, Inc.

Answer:

What you’re asking is a classic return on investment (ROI) scenario. But just because it’s a common problem doesn’t make dealing with it any easier.  In an independent restaurant, improvements to the system (and I agree that a POS system would be a big improvement) come out of the owner’s pocket, so the potential benefit needs to be clear.

In this case, the benefits of a POS system are pretty well known.  Henry Pertman, Senior Sales Manager, MICROS Mid-Atlantic, can rattle off a host of reasons to go from cash register to POS.  Among them: “Bookkeeping costs should be reduced by thousands of dollars annually. POS can help keep a handle on an overall stock management program. You can get historic figures at a moment’s notice so as to opt in or out of great buys, best opportunities leading to thousands of dollars of annual savings. The mistakes which new employees make from charging the wrong prices (intentionally for their friends, or inadvertently) still cost thousands of dollars a year. The mistakes kitchens make because of timing issues or just plain bad handwriting adds up to thousands more. And POS reduces cost and minimizes errors by putting the entire enterprise on the system. No separate credit card or gift card terminals, which can be riddled by fraud and mistakes costing countless dollars. No time clock, which can be abused, or misused. This can likely eliminate thousands of dollars annually in unauthorized overtime to be paid to higher paid employees, such as cooks.”

My advice: Once you’ve decided on a preferred system, partner with your sales rep. Explain the problem and ask her or him to help you make your argument and show the potential ROI.  The vendor likely has case studies , white papers , and client references or testimonials that can help you.  Collect some simple data at your own operation over a one week period such as actual versus reported clock-ins, number of kitchen items fired versus those on dupes, and actual liquor costs from physical inventory versus targets and multiply that by 52 to get the annual cost overruns.  You will be better armed to make your case.

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