Best POS Systems For Small Business In 2025

A POS system, also known as a point-of-sale system, is a hardware and software solution used to conduct transactions. This could be anything from selling a product to managing inventory or tracking customer data. A POS system can be as straightforward as a card reader or as complex as an all-in-one solution that includes features such as loyalty, scheduling, front of house, inventory management, customer relationship management (CRM) and e-commerce.

POS systems are used by businesses of all sizes in a variety of industries, including retail, restaurants, hospitality and services. If you’re running a business that relies on transactions of any kind, then a POS system is likely a good fit for you.

A point-of-sale system guides customers through a series of steps that end with a successful purchase. In most cases, it works in the following way:

• A customer selects item(s) to buy: The buyer either physically presents the products at the checkout kiosk in the store or views their digital shopping cart with the intent to finalise their payment.
• The POS system prices the item(s): The business’s POS tool tallies the total cost of the customer’s item(s), including applicable tips and sales taxes. Often, businesses use POS software that provides discount management tools. These allow companies to keep track of how customers apply coupons and promo codes.
• The customer pays: Customers typically pay using credit cards, cash or cheques. Therefore, POS systems often include corresponding hardware such as cash drawers, card or cheque readers and receipt printers. While online stores lack the need for hardware components, their point-of-sale systems usually include plugins or apps that make it possible for customers to pay using credit cards, PayPal or even cryptocurrencies like Bitcoin.
• The POS system completes the transaction: The software runs calculations that determine what the customer owes and the exact change that may be due. At this point, a cashier or the automated machine itself manually returns any change. Internet shoppers get taken to a post-purchase page with their relevant purchase and shipping information. In most cases, customers receive a confirmation email.

A POS system can do much more than track sales. The right software can provide crucial insight into customer behavior, enable real-time tracking of inventory and much more.

To choose the best POS system, first consider whether or not the system offers the tools and features your business needs–now and in the future. Ideally, a POS system should make it easy and affordable to accept payments no matter where you are selling or how customers are paying. Additionally, look at the bigger picture in terms of pricing.

Depending on your sales volume, it may or may not be worth opting for a POS system with a higher monthly rate if it comes with the benefit of lower transaction costs.

POS Software Features

When choosing a POS system, the first step is to consider what features you need. Do you need basic transaction processing, or do you need more advanced features such as loyalty, appointment scheduling, inventory management and email marketing?

Here are some common POS software features to look for:

• Credit card processing: All POS systems will process credit and debit cards, but some systems will require you to use a specific payment processor. Others will let you choose your own processor.
• Loyalty: If you want to offer loyalty programs or gift cards, look for a system that offers this feature.
• Appointment scheduling: If you’re in the business of appointments, such as a hair salon or a day spa, look for a system that offers online booking and appointment reminders.
• Inventory management: If you need to track inventory levels, look for a POS system that includes this feature. Some systems will even let you automatically reorder when inventory gets low.
• Customer relationship management (CRM): If you want to track customer data, look for a system that includes a CRM feature. This will let you keep track of customer purchase history, contact information and more.
• Reporting: All POS systems will offer some kind of reporting, but some will be more robust than others. If you need detailed reports on your business performance, look for a system that offers this.
• E-commerce: If you want to sell online as well as in store, look for a system that offers an e-commerce solution. This will let you manage inventory and orders from one central platform.

POS Hardware Features

In addition to software, you’ll also need to consider hardware when choosing a POS system. The type of hardware you need will depend on the type of business you have and the features you’re looking for.

Here are some common POS hardware features to look for:

• Touch-screen display: A touch-screen display is a common feature on POS systems. This lets you easily navigate the software and enter information.
• Receipt printer: A receipt printer is a must-have for any POS system. This lets you print receipts for customers.
• Barcode scanner: If you need to scan barcodes, look for a POS system that includes a barcode scanner.
• Cash drawer: A cash drawer is another must-have for any POS system. This lets you store cash and keep it organised.
• Payment terminal: If you want to accept credit and debit cards, you’ll need a payment terminal. Some POS systems come with a built-in terminal, while others require you to use a separate one.

Types of POS Systems

There are many types of POS systems on the market, from simple card readers to all-in-one solutions. The best POS system for your business will depend on your specific needs.

Here’s a rundown of the different types you might encounter.

Hospitality POS

A hospitality POS system is a specialised type of POS system that’s designed for restaurants. These systems typically include features such as table management, kitchen display systems and online ordering. Most will also have inventory management, so you can auto-reorder ingredients as they get low. There are even POS systems with features ideal for managing bars.

Retail POS

A retail POS system is designed for retail businesses. These systems typically include features such as inventory management, customer loyalty programs and gift cards. Some retail POS systems also offer appointment scheduling and reporting.

iPad POS

An iPad POS system is a type of mobile POS system that uses an iPad as the main point-of-sale terminal. These systems are becoming increasingly popular due to their portability and ease of use. Many iPad POS systems come with built-in features such as credit card processing, scheduling and receipt printing.

Mobile POS

A mobile POS system is a type of POS system that can be used on a mobile device, such as a smartphone or tablet. People are relying more on these systems because of their portability and easy setup. Many mobile POS systems come with built-in features such as credit card processing, inventory management and receipt printing.

Android POS

An Android POS system is a type of mobile POS system that uses an Android device as the main point-of-sale terminal. Due to their mobility and simple-to-use interface, these systems are increasing in popularity, too. Most Android POS systems come with features such as credit card processing, barcode scanning and receipt printing.

Cloud POS

A cloud POS system is a type of POS system that’s hosted in the cloud. This means that all of your data is stored online, making it easy to access from anywhere. Cloud POS systems are becoming more popular because they’re easier to set up and use than traditional POS systems. They also typically come with features such as inventory management, customer loyalty programs and gift cards.

POS Terminal

A POS terminal is a type of POS system that’s designed for businesses that need to process credit and debit cards. These terminals typically come with features such as EMV compliance, PCI compliance and fraud prevention.

The cost of a POS system will vary depending on the type and features you need. Generally, the more features you want, the more you can expect to pay.

Some companies lend you a POS system in exchange for a monthly fee, while others require that you purchase the system outright.

More expensive POS features include:

• Credit card processing: To process credit and debit cards, you’ll need to pay a monthly fee for most POS systems.
• Inventory management: Some POS systems come with inventory management, while others require you to purchase a separate system.
• Customer loyalty programs: To offer customer loyalty programs, you’ll need to pay a monthly fee for most POS systems. Most have this as an optional add-on, rather than a built-in feature.
• Reporting: Most POS systems come with reporting, while others require you to use a third-party integration. For more advanced reports, you may need to pay for a higher-tiered plan.
• Online ordering: Restaurants that want to offer online ordering will need to pay a monthly fee for most POS systems, in addition to any third-party costs such as fees for DoorDash or Uber Eats.

To reduce costs, you can look for a POS system that comes with a free trial period. This will allow you to test out the system before committing to a long-term contract. You can also look for discounts, such as seasonal promotions or referral programs. However, the easiest way to pare down costs is to only pay for the services you need.

When considering the cost of a POS system, you’ll also need to factor in the costs of hardware, such as receipt printers and barcode scanners. These can range in price from a few hundred dollars to a few thousand, depending on the quality and features you need.

After paying for hardware and software, you usually have to pay processing or transaction fees. These are typically a percentage of the total sale, plus a small per-transaction fee. For example, if you’re paying 2.5% plus $0.10 per transaction, and you make a sale for $100, your total fee would be $2.60.

When you’re choosing an option, you’ll need to decide whether you want a point-of-sale (POS) system or a cash register. Both have their pros and cons, so it’s important to choose the one that best suits your needs.

POS systems are typically more expensive than cash registers, but they offer more features and functionality. Cash registers only track sales and print receipts, while POS systems can track inventory, customers, employees and sales.

POS systems also typically offer features such as loyalty programs, gift cards and reporting, while cash registers typically do not.

POS systems are a good choice for businesses that want to track inventory, customers and sales. They’re also a good choice for businesses that want to offer loyalty programs, gift cards and reporting. However, they’re unnecessary for businesses that only need to track sales.

Ultimately, while a POS system is ideal for businesses wanting more features, cash registers are still a good choice for businesses that cannot afford a POS system.

Once you’ve chosen a POS system, you’ll need to learn how to use it. Luckily, most POS systems are easy to use and come with training materials or customer support.

• Cloud-Based Systems: If you’re using a cloud-based POS system, you’ll need to create an account and log in, and then you can start adding products, customers and employees. Most cloud-based POS systems come with a built-in tutorial to help you get started.
• Self-Hosted Systems: If you’re using a self-hosted POS system, you’ll need to install the software on a computer. Once it’s installed, you can start adding products, customers and employees. A built-in tutorial is included with most self-hosted POS systems to assist you in getting started.
• Hardware Set Up: A POS system involving hardware will require you to set up the hardware, such as receipt printers and barcode scanners. This is a more complex process, and in some cases, even requires an onboarding specialist on-site or to walk you through the process over the phone. Once the hardware is set up, you can start adding products, customers and employees.
• Order Processing: Once you’ve added all your products, customers and employees, you’re ready to start using your POS system. To make a sale, you’ll need to add the items to the order and then process the payment. Most POS systems can process payments by credit card, debit card, cash or cheque. After the payment is processed, you can print or email a receipt to the customer. Some POS systems also allow you to send text or email receipts.
• Reporting: Reporting is an important feature of most POS systems. With reporting, you can track sales, inventory and employees. This information can help you make informed decisions about your business. Most POS systems offer a variety of reports, such as sales reports, inventory reports and employee reports. Some POS systems also offer custom reporting. This is the key to getting the most out of your POS system—use your reports to gather insights into your business and make changes accordingly.

To determine the best POS systems, Forbes Advisor looked at a variety of factors, including monthly fees, hardware costs, features, ease of use and integrations. We also considered each company’s reputation and real user reviews.

When it comes to price, we looked at the monthly fees for each POS system. We also considered whether there was a free option or trial available. For features, we considered the range of features each POS system offers as well as how easy they are to use. We looked at integrations to see which POS systems work with popular accounting software or e-commerce platforms.

User reviews were also a factor in our decision-making process. To get a sense of what actual users think about a POS system, we read through customer reviews. Finally, we considered each company’s reputation. We looked at awards they’ve won and positive press they’ve received.

There are a number of important POS system trends to be aware of this year. Here are the ones you should be paying attention to so that your business stays competitive.

Cashless and Touchless Transactions Continue to Gain Momentum

The COVID-19 pandemic was a major impetus behind the shift toward cashless and touchless payment options. In a world concerned with hygiene and lowering transmission rates, technologies that allowed touchless payment became an essential part of purchasing infrastructure. This technology includes tap-and-go credit and debit cards and digital wallets that can be accessed through a smartphone or smartwatch.

These payment methods are not only hygienic but also offer the consumer increased speed, convenience and security in their purchases. These factors have contributed to the continued popularity of these methods even as the pandemic has subsided.

More Advanced POS Hardware and Software

Gone are the days when POS systems had to be run from large, clunky, stationary computer systems. Hardware that works with POS systems is now more advanced and mobile than ever, allowing more flexibility for store associates and the business as a whole. Expect to see more smartphones, tablets, Bluetooth technology, secure order pickup lockers, electronic shelf labels and smart self-checkout solutions in 2023.

This more advanced hardware has been made possible by both physical and virtual improvements in technology. Without the advancements in software powering these devices, they would have offered a more limited level of functionality.

Cloud-hosted POS Systems are the Future

Cloud-based technology has taken the business world by storm in recent years and will continue to do so into 2023 and beyond. POS systems based in the cloud can be updated and integrated easily with other business operations, and they back up and store data securely automatically. Cloud POS systems also come with significantly lower price tags―usually in a software-as-a-service (SaaS) format―making them more accessible to businesses that also have budget constraints.

Increased Mobility

The cloud allows POS systems to operate over an internet connection, which has paved the way for these systems to be used on mobile devices. Traditionally, POS systems would be tethered to centralised computer stations reliant on physical connections. Now, this software can be used on mobile devices in any location, increasing the system’s flexibility and improving a business’ overall productivity.

Improvements in Self-service Kiosks and Infrastructure

With the rise of cloud technology, self-service infrastructure is also advancing in leaps and bounds. In addition to traditional self-service checkouts, such as you’d see in a grocery or retail store, self-service can now be used in other applications, such as all-in-one restaurant ordering/payment and brand-new storefronts in which checkout and payment isn’t necessary at all (Amazon Go).

In 2023, we will see a greater emphasis on these technologies as they are convenient, cost-effective and can reduce errors in the ordering and checkout process.

Shopping Experience

A customer’s shopping experience can be personalised by offering messages, offers and products that are selected and tailored to a customer’s individual behavior and preferences. Companies can also show that they value their customers by ensuring that they proactively direct them to their preferred channels, keep their checkout information at the ready for increased convenience, allow them to switch between applications and communication channels effortlessly and connect them automatically with the best resources to meet their needs.

Customers know that companies collect data about them every time they use the internet, and they now expect that this data will be used to improve their experience with the company. There is no doubt businesses will continue to allocate resources to make these services a priority.

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