POS software is used to process customer transactions, accept payments, and update inventory levels for a retail establishment. Depending on the vendor, businesses can choose between on-premise, cloud-based, or hybrid deployment models. Cloud solutions are generally less expensive on the front end, support greater mobility, and require less IT maintenance. However, some business may choose on-premise or hybrid solutions to ensure offline access in the event of an internet outage, or to secure deeper integrations with POS hardware (barcode scanners, card readers, cash drawers, etc.).
When it comes to features, the software market is highly diverse, with products ranging from best-of-breed payment processing apps to comprehensive product suites known as retail management systems (RMS). Although best-of-breed apps tend to excel at specific functions, a growing number of businesses are moving towards integrated solutions that offer end-to-end functionality. The obvious benefit of an integrated system is that it links POS transactions to other back-end processes like inventory, accounting, and customer relationship management (CRM). According to a recent study by Boston Retail Partners, in the next four years there will be a six-fold increase in the number of retailers using unified commerce platforms.