How is mobile technology transforming point-of-sale systems?

Modern technology allows instant transmission of restaurant orders to kitchens, payment of taxi fares via credit cards, and scanning of groceries directly into shopping carts. Welcome to the era of mobile POS systems. Wireless technology is reshaping the way we shop, and this trend is on the rise.

Point of sale (POS) refers to the location where a transaction happens — where money is exchanged. While credit and debit card payments are common today, most transactions used to involve cash or checks, with merchants storing the funds in a cash drawer or box. The invention of the cash register in the 1870s, a mechanical device to track earnings, marked the birth of the first POS system [source: RetailSystems.com].

The next major POS breakthrough came in the 1970s with the introduction of barcodes. Starting in 1974, Universal Product Codes began appearing on products. This allowed merchants to use scanners to quickly and accurately process transactions [source: National Barcode]. Over the past two decades, retailers have introduced additional devices to speed up checkout, such as card swipe machines for credit and debit cards, signature pads, and PIN entry systems.

In the 1990s, wireless computer networks – which transmit data through radio waves – were developed, enabling POS systems to go mobile. Restaurants were the early adopters, using mobile technology to process credit card payments at tables. Other industries followed suit, such as car rental companies which implemented mobile POS to manage returns curbside. Hotels also adopted the technology, allowing servers to take drink orders poolside using mobile devices.

Retailers are now replacing traditional checkout counters with portable devices for clerks. For instance, many Apple stores have done away with cash registers entirely, using handheld devices to answer customer inquiries, check inventory, and complete sales [source: First Data].

Mobile POS is particularly beneficial in field operations. For example, Hampton Jitney, which provides bus services between New York City and Long Island, utilizes an onboard system that enables attendants to check reservations, process payments, and print receipts [source: Zebra.com]. Small vendors, like flea market sellers or bake sale operators, are also using mobile phones to accept credit card payments and process transactions [source: Extended Retail Solutions].

Despite some concerns over the security of wireless transactions, mobile POS offers significant advantages for both consumers and businesses. Retailers and service providers can enhance productivity and reduce labor costs. For example, a restaurant server can save time and energy by eliminating multiple trips to the kitchen or cash register. Mobile POS also reduces errors by replacing handwritten orders, offering customers faster service and precise, on-the-spot receipts.

Continue reading to explore the latest advancements in mobile point-of-sale technology.

What’s the future of mobile point-of-sale systems?

Wagamama, a global restaurant chain, has pioneered the use of mobile POS systems. Upon seating, servers enter the customer’s food and drink orders into a compact mobile device. These orders are instantly displayed in the kitchen and bar. Once prepared, the chef presses a button, prints a ticket, and sends it to the server for delivery. After the meal, the server can process payment via credit card and print the receipt from a portable printer [source: Clancy].

Wagamama’s next innovation in mobile POS is an iPhone app, allowing customers to place orders before even arriving at the restaurant. Diners can view the menu, send orders directly to the kitchen, pay via credit card, and choose to either dine in or take out. Currently available in the UK, this feature is set to expand to other countries soon [source: Clancy].

With the rise of mobile POS, the focus is shifting toward enhancing transaction security. One solution retailers are adopting is encrypted card readers. These devices ensure that the customer's information is only transmitted in encrypted form, significantly reducing the risk of theft [source: Ciardiello].

One significant advancement in POS technology is contactless payment. This system uses a card equipped with a computer chip that doesn't require swiping. MasterCard is collaborating with retailers like Home Depot and Sports Authority to introduce POS systems that support contactless cards. Some gas stations and fast food restaurants are also adopting this technology [source: Mobile Banker]. This method can reduce transaction times by up to 30 seconds, making lines shorter [source: Extended Retail Solutions].

Looking ahead, mobile phones are set to play a key role in contactless transactions. Visa has launched a program in Malaysia that allows customers to pay by simply waving their enabled phones near a terminal. The phone securely transmits the owner’s credit data to the device while tracking each transaction [source: cellular-news].

Mobile POS technology is expanding in innovative ways. For instance, Stop & Shop Supermarket Co. is introducing the ScanIt! system in several stores. Shoppers can scan their loyalty card upon entering a ScanIt!-enabled store and pick up a portable scanning device. This scanner displays special offers and coupons tailored to the shopper's history, even providing deals as they approach certain products in the aisles. Shoppers can scan and bag items immediately, and then pay at a self-service kiosk [source: Ciardiello].