Point of sale systems do much more than process a business’s transactions with customers. They also help business owners gather and track the kind of data that can be used to make smart and efficient decisions about business management. POS has evolved to encompass all aspects of a company’s operations, including a POS system business plan that serves as the blueprint for the organization’s success.
How POS Fits into Your Company’s Business Plan
The core functions of a POS correspond to the categories in the U.S. Small Business Administration’s formats for traditional and “lean” business plans:
- The market and sales analysis data that is used in the business plan is based on figures that are recorded and analyzed using the company’s POS system.
- The service or product line information relies on the POS system’s inventory management figures to ensure sufficient quantities to meet expected demand without overspending on storage, excessive product returns, or spoilage.
- The organization and management section of the business plan is based on employment and operation cost projections that use employment tracking and performance data collected by the POS system.
- The marketing and sales projections are derived by analyzing customer histories and demographic information about the business’s customers, collected via its POS system.
Compare the SBA’s sample business plan categories with Software Advice’s description of the core features of modern POS systems:
- Recording and analyzing sales data ensures business decisions are based on up-to-date information.
- Optimizing inventory management prevents products from running out or spending too much time on the shelf. It also reduces returns and product “shrinkage.”
- Establishing and maintaining relationships with customers lets businesses anticipate customer preferences and personalize special offers to target marketing more effectively.
- Tracking employee work hours and performance keeps payroll expenses in check and helps calculate the return on investment for new hires to support expansion.
It will be easier and more efficient to execute your company’s business plan if its POS system offers the features that help the business achieve the goals outlined in the plan. That’s why it makes sense to choose a POS system that is a good match with your business plan. Considering the breadth of functionality available in modern POS systems, linking the two is more straightforward than you might expect.
Tips for Creating a POS System Business Plan
The traditional business plan template begins with an executive summary and company description. The summary includes the company’s mission statement and explains why the business will be successful. It describes the firm’s products and services, lists its leaders and employees, and includes the business location. If the business plan includes a request for financing, this section will present its financial status.
The company description must explain in detail the problem the business will solve, as well as the consumers or businesses it will serve. Central to this description is the competitive advantage that will allow the firm to succeed, whether it’s the expertise of staff, the business’s prime location, or some other particular strength.
A POS system helps businesses gather the information that supports the assertions it makes in its business plan. The system’s reporting and analytics serve as the foundation for its proposals and strategies, while the customer information, employee data, and inventory numbers provide data about its prospects for success.
The last two sections of the traditional business plan template cover the company’s financial projections and funding requests. Data from the POS system’s sales management, customer relationship, and employee tracking features serve as the foundation for the company’s financial forecasts. The information can also be shared with potential lenders or investors.
A popular alternative to the traditional business plan template is the business model canvas that was devised by Alexander Osterwalder of Strategyzer. Business Models Inc. describes the model as a method for gaining insight into the business in a “structured, straightforward way.” The model’s nine sections are intended to demonstrate how the company will create, deliver, and capture value:
- Customer segments (the top three)
- Value proposition
- Revenue streams (the top three)
- Channels used to communicate with customers
- Customer relationships
- Key daily activities
- Key resources (people, knowledge, methods, etc.)
- Key partners (excluding suppliers)
- Cost structure (based on activities and resources)
The data collected and analyzed by a POS system can be used to populate the various sections of the business model canvas. It does so by capturing up-to-date information on sales and costs, employee performance, customer relationships, marketing and advertising effectiveness, and other aspects of the business.
Case Study: A POS System Business Plan
For the past three years, Amelia has operated her hair salon located on a busy corner not far from her town’s central plaza. On most days she has more customers than her existing staff and facilities can accommodate. Many of Amelia’s customers live near a new shopping center near the outskirts of town that also features several new housing developments.
Amelia has been thinking about opening a second salon in or near the shopping center. She is preparing her business plan and has turned to her POS system to supply the information the plan will require. Using her POS system’s reporting features allowed Amelia to include up-to-date sales figures and to demonstrate that her best-selling services were also those that would attract the most potential customers to the new location.
The business plan Amelia prepared for her new outlet highlighted her talented staff of cosmetologists by using employee performance data, appointment records, and orders and payment history collected by the shop’s POS system. Amelia was also able to forecast potential revenue for the new location by using information from the system’s customer records on the shop’s loyalty programs, gift card sales, special discounts, and other personalized offers.
Having this wealth of data available through the functionality of her salon’s POS system allowed Amelia to complete her plan for the second location without having to access multiple systems or request it from third parties. She was confident that the information in the plan was accurate and up-to-date. In fact, Amelia’s POS system made preparing the business plan so easy she wondered why she waited so long to begin her expansion.
A POS system has the potential to serve as the technology foundation for all of a business’s operations, including the process of setting short-term and long-term strategies for success. When you’re ready to start your next business plan, be sure to tap the data and resources served up by your POS network.
When you partner with talech to develop your POS system business plan, you get a truly innovative POS solution, expert support, and the right kind of data that can get you to your goals. Reach out to us today to sign up for a demo and to learn more about how talech can be your valued POS partner.
