BLOGS AND ARTICLES FROM THE POS SOLUTIONS TEAM

Point of Sale Software

Overstocking and what can be done

POS SOFTWARE

No-one can handle the vast numbers of products available to almost all retailers.

Most the suppliers have large numbers of items on catalogue. They will also have many more if you require something special. 

A typical client of ours would be selling actively over a year over 43,000 lines. That is a lot of work if you order once a week to handle it. Who can go over that many items?   There is only so far gut feel and memory. Can take you.

A computer can but to get a computer to do it requires a central stock system that is up to date and updated. Once done this allows your stock to be managed better and meet your customer's expectations while reducing wasting money with overstocking

This is why we recommend that you consider switching to a computer ordering system, e.g. focus that can quite cheaply and fast do the ordering. One point you will find is that the computer system works well in the model of smaller order and frequent buying.

What the computer does is looking at your history of sales, it then makes an ideal stock quantity for today that it thinks you will require (focus). 

It then compares this figure to what the actual stock on hand figure you have, it then adds some safety stock and then issues a stock order with almost no work to you to the supplier depending on the suppliers' requirements.

This reduces your holding costs, as you are not holding that much in stock.

It also

  • Lower labour charges - as its computer time, not your buyers time.
  • Lower ordering costs - as you are buying to the suppliers' terms
  • Improved selling rates - as you are now ordering what you need.
  • Decreased out of stock - as the computer is checking continuously
  • Overstock wastes - in practice a computer works out the required stock better than a person
  • Improved stock accuracy - you know what you have 
  • Higher customer satisfaction - you have fewer stock-outs

You will save a lot of time.

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Internet speed

POS SOFTWARE

Does not matter how fast the internet goes, we all want more speed.

No two places are the same.

The problem is that today we have in Australia seven different nbn connections and your internet speed depends on what connection you do have, how many people are on the internet in your area and the distance that you are to the fibre cable.  Now it is slowly getting to be only fibre as most of the copper is gone. 

If you want to know what type of internet connection you actually have and your options click here.

If you want to test your internet speed click here.

As a rule, I would say that a modern business needs a broadband download speed of 40Mbps (megabits per second). What you need to check is a few times in the day as it changes eg morning, lunchtime and evening.

We had a client that tested their connection and then they complained. It was discovered that some of the internet wiring was corroded, and once that was fixed the problem went away.  So it pays to check.

 

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What are my best selling items?

POS SOFTWARE

Here are some questions to ask yourself.

What are my best selling items?

Which items in my shop are just sitting there?

Here is a rule that that shows in retail often all the time, a small percentage of your stock lines up all the time give you almost all your sales. 

I took a data file from a customer of ours, and in a year, I found that they sold 20,060 different stock lines.

Here are some figures:

Less than 1% did 50% of shop sales.

The top  2 stock items did 15% of the shop sales.

Ten stock lines did about 33% of the shop sales.

Now let us find your top stock lines.

Go to register reports and select the top stock report as marked with the red arrow here

You will get this screen

Now choose your criteria, note there is also a tab called "More Criteria" which has more options plus the traffic (which is people in the shop) option, but we will discuss that later.

I do suggest that you do this by overall shop sales and then research in-depth for each department.

It’s that simple

It can be done in less than a minute.

Check your treasures. 

 

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Note on newsagency computer systems and numbers

POS SOFTWARE

 

A competitor released a dubious statement which among claims is that they serve more newsagencies then anyone and that this is shown by evidence that is 

1) recent

2) independent

3) verified 

As such from what I gather their system

1) the industry standard - something that I doubt eg much in magazine processing and lotto they cannot do.  

2) Not expensive - something that would surprise many of its users and me too.

When I queried them about what the evidence, it appears that it comes from a series of court cases they were involved in going from 2004 to 2009, hardly what I would call recent.

If so it would not be what I would call independent.

They then claimed to me that the other side agreed with the facts. The problem here is that the case never was resolved in court so that the judge would not have assessed this. Still, then it gets puzzling as I went through the court records and the opposing barrister's book, which has the information they need in the case. I can find no record of such a document. When I queried my competitor about this, I am still waiting for a reply. Until then, it is hardly what I would call verified.

So I have great doubts about all this, but I am willing to keep an open mind if they want to show me the evidence. 

Note: We offered to have an 

1) recent

2) independent

3) verified 

report on this subject with them, when it mattered and they refused.

 

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Comparison reporting

POS SOFTWARE

We suggest that every month you do a sales Comparison report to compare how you did this month to the same month last year.  This is considered as being a very good indication of how you are travelling,

You will find it here:

Main Menu > Cash Register > Register Reports > under the Select Report tab, expand the Stock folder > select the report “Dissection Family Class Period Sales Comparison”.

Then you will see this screen.

 

Now put in the last month of January 2020 and compare it to January 2019.  Then out will pop out a wide range of KPIs, including quantity, cost, sales, profit and GP%. with a breakdown by amount and percentage. I find the GP% to being very useful as that is the actual figure that I am getting not what the suppliers are telling me.


Once you have done that please experiment with the extra options in the More Criteria tab which I marked with a green arrow.
 

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Afterpay Touch Group - eServices Wind Down continued

POS SOFTWARE

 

Many of you have contacted us to ask us what is happening as a result of the Afterpay Touch Group winding down their eService business. 

Please give us some more time.

To fill you in, if you are not following the story.

Touchcorp was in Dec 2016, was making a profit of 11.5 million dollars

Take a look at its revenue figures in yellow and its profit in blue from the report 

See what Afterpay are walking away from? It states much of the changes in the economy.

We do not consider the ePay terminal, which is not integrated as a satisfactory solution.

But rest assured that we have been on to it. We have spoken to Touch management, ePay, Telstra, I think all major gift card distributors in Australia, the fisheries departments, NewsCorp, WA news, etc. I have also communicated to a whole lot more, e.g. Optus, VANA (who by the way have not responded for some reason), etc.   I can report all of these are in a state of shock about it too.

This is partly as who wants an extra box on the counter and partly as there is so little margin to be made out of these products that to make it work, it must be integrated. Beside our integrated solution gives I believe the best margins to retailers, why should they drop margin on a terminal?

I told these suppliers straight out that we consider this a significant product to our clients who are doing in the high teens millions of dollars trade a year with these products. Okay I told them, it does not produce a high income because your margins are so low, but it does bring many people into the shop. As a first-level approximation as even a small shop is getting about two trades a day. Assuming a client acquisition cost in retail in Australia at about $15 and about a third of the trade is new customers, we are looking at (2 a day x $15 x 300 days a year x 3 years x 33%) = a goodwill value of about $10,000 lost if no alternative comes forward.

Okay, we hope to have something soon to tell you, but please give us a little more time as we are reluctant to discuss what is being proposed until we have confirmation about where our users and we stand. The last thing we want to do is to say something which does not happen. 

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Security in your point of sale

POS SOFTWARE

This cannot be stressed too much.

In a retail business, every person in your point of sale Software should have a unique login and that they must make them make use of it. Do not allow several people to share the same login otherwise, it can be impossible to track and investigate what happened.

What you will find is that if your staff know that they are being audited, it will reduce the risk to you and your customers.

 

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Special orders

POS SOFTWARE

If you are doing special orders in your shop, what I suggest you do is put the special order into the computer and bill from the computer. Here are some reasons why:

1) Your pricing is transparent and everyone can see how it is calculated,

2) You charge the right amount for it, one of our clients told us that since he put a computer in, they have picked up a lot as they were often not charging for some options.

3) It makes it easy for the person working the till to run through the current options to the customers.

4) The computer makes a professional worksheet for the person doing the job to follow.

 

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Afterpay Touch Group - eServices Wind Down – 30th June 2020

POS SOFTWARE

At the start of February, we were notified that the eServices from Touch Afterpay confidentially advised us that they were closing down. Apparently it does not fit into their strategic priorities and as such their long-term growth. This was a shock as we have been using this service for almost twenty years. It is a very good service.

Presently we are discussing the situation with Afterpay and with some of their suppliers all that appear to be quite in shock about this announcement. Everyone is saying that they did not get enough warning to make plans although several like the NSW Fishing licence sales, told me that they do not have an alternative in place so if you want to sell their products after the closure then you need to contact them directly and they will if you are approved they will put you on a manual system. 

Some suppliers, however now, are looking at options, as they know that many of their sellers will drop their products if they need to go to a terminal and/or manual system. When we have some answers, we will get back to you.

Now, all we can say is that we are talking to people, we are looking for options and we may be about to do something.

If someone wants to discuss it with me further or they have some information that they think they should share with us about it, please let me know.

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Keyboards are dirty than toilets

POS SOFTWARE

This discussion came out of my last post when some people commented about fixing computers and brought up cleaning.

Everyone is worried now with Coronavirus, here check this video out about China. 

 

Back in Australia, a study was done of bacteria found on standard items.

Look at the keyboard that I highlighted with the red arrow and now compare it to the toilet seat.

 

Interestingly it was shown that women’s desks tended to have more bacteria than men’s. I cannot explain that!

Although I have never seen any studies of point of sale environment, I am sure with shared equipment and   

The overall crux is that we need to use something to clean desks and computer equipment on it. I use an Antibacterial Disinfectant Wipe from the supermarket, which costs a few dollars now and then and has like 600 wipes in our office. 

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On Google reviews

POS SOFTWARE

 

It is a modern business nightmare. You put all this effort and money into your business, and suddenly you find your hard-earned reputation is attacked by some anonymous person online. 

We have had this problem. We were selected in the newsagency industry to do the trials of the new Australian government social security cards. Out of the blue, a whole lot of people suddenly attacked us clearly who were not clients of ours for what we are sure is political purposes.  Unfortunately, there is not a lot you can do here, this was my experience when I complained to google and yahoo on one of our competitors

So what do you do if a negative review appears that you consider false and damaging to your business reputation of the business?  

Well my advice is 

1) Is assume that they could be real and answer their complaint and state *nicely* that you do not know that person and you have doubts about the review and that you are more ready than ready to address and fix the problem.  

2) Ask Google to delete it which they probably will not.

There is a third alternative go to court.

Generally, I think it is a long shot as you need to get the actual identity of the reviewer and then you can sue them to get them to take it down and for damages. This I am sure will take a long time, be very expensive and by the time it gets to court who will care about a matter years old anyway.

However this is what one dentist in Northcote in Melbourne did, he took Google to the Federal court to get the name of the anonymous negative reviewer and won (maybe?) 

Google the court ruled has to give him the name of that person but it remains to be seen if Google will or can do this. Today with public WiFi, it may be impossible. Even if he gets what google thinks is the name, it may be impossible to sue the person. A case in Holland, I read about the courts let a person off as although he admited it was his account, what he claimed is that he did not do it and that someone else must have hacked into his account. 

I do believe that this matter needs to be addressed by Australian Law.

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Some tips to save costs on a computer repairs

POS SOFTWARE

Point of sale systems is excellent, till something goes wrong. Then for some reason, people seem to lose all sense of reason and proportion. The fact is that they are all mechanical devices and all of the parts will sooner or later fail and everything will be replaced. I know we run a comparatively big computer repair business.

If your computer or one its components are not working or acting very strange. Here is a simple checklist you should try before doing anything.

1) The first question to ask yourself, is it used to work, what has changed now? If you can think of that something, check that. 

2) Make sure that nothing is stuck down, and it looks like it should work, is the computer keyboard keys stuck, is the paper free on the printer if the printer is the problem, etc. Try to isolate the problem to find *the problem*.

3) Switch off the part and wait a minute, use the time to take some deep breaths. Now switch it on and test it. 

If that does not fix it, try switching off everything the computer and the part, wait a minute and then switch them on again and test it.  

4) If that does not fix it, check the cables from the part to the computer, check the cables to the part/computer, often the problem is a cable is not incorrectly. They are loose and then came out a bit.

Check the connections of the wires, if they are not firmly in, that may be the problem. Give them a push.

5) Even if you have not found anything here, I would suggest that you turn everything off and wait for a minute and try again, sometimes a miracle happens, and it works.

By now, I would say about 3/4 of all problems are solved but if you are now and it is still a problem, well the reality is that there are numerous ways that your system can break down and malfunction and it depends on your level of computer skill on how much you can fix.

If you have the time and you want to get hands dirty you can put the problem into Google, and ask for some troubleshooting assistance be careful even with an experienced technician, the challenge and expenses can quickly snowball. 

If the problem is still there, then its time to give us a call or your hardware supporter. If so note:

What exactly is the error
If possible write down the errors or take a photo of the error.

How do you get the error
The hardware engineer first instincts will be to try to reproduce the error in his mind. So how did it happen? Was there anything happening when the error appeared, does it come and go, etc 

Make sure you have a backup
 

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Auditing if something goes wrong

POS SOFTWARE

 

While doing your reports, a figure may appear that looks wrong, and you need to investigate. 

This happened to me, a while ago while investigating our GST on purchases.

The way, I recommend you approach it is to isolate the problem to as small an amount and time as possible.

So what I did was break the period of the purchases into months and investigate each month, then in a month that was wrong investigated each week and then I went day by day till I found the error in the day.

Then I looked through all the transactions for that day till I found it, an insurance claim that had no GST.  

This method always in my experience works.

Note the toughest errors to find in my experience are those that look right.

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Lights go out does your business too

POS SOFTWARE

Suddenly the electricity cuts off, an Uninterruptable Power Supply (UPS) may be the difference between you still working, or you are having everyone just sitting around till the power comes back on. I also do believe that the performance and longevity of your Point of Sale equipment will increase if you use them.

Here are some tips if you are interested in such technology.

1) You need to decide how long you need the UPS to function, in the city often the power goes down for a few minutes, but in the country, it can be an hour. Generally, it is best to spend a little more and get something that lasts a bit longer. No one is going to complain if it is slightly too loud.  

2) They need testing. I have seen the battery inside fail with no warning. They are easy to test; just switch the power off. One problem with UPS, far too often they fail straight out of the box, so they need testing.

3) Check for noise, some of them are very nosy in operation

 

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Google Trends

POS SOFTWARE

One tool I do recommend if you are doing market research on products is Google Trend. This is a potent tool by which you to enter search terms that are relevant to your business, to see what is Australia looking for with this product. It is free.

What is particularly useful in retail is that it can also be used to show seasonality of demand which can help you to bring stock into the shop when required. 

Say, for example, we are looking at chocolate bars.

So I put into google trends the most popular chocolate bars in Australia, that I know and I select five (5) years as I want a long view. 

 

Now I can see how Australia is looking at these chocolate bars. There has been a slight drop but not much. Mars bars are the most popular with Kit kat looking good. 

I also can go deeper into it.  I would suggest checking out the breakout items listed in the Google Trend report too as it shows where Australia is headed. 

This can assist you in making decisions by giving you objective facts.

 For a detailed study on how to use Google Trend, please click here.

 

It is well worth a read.

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Gap Analysis

POS SOFTWARE

Gap Analysis in easy steps

This is a formal process of comparing what you got with your budget and is designed to determine *why* it was right or wrong.

What you do is compare your budgeted figures to your actual numbers. You do not have to have a budget as such what you could use in a pinch, is a rough measure of what you think you should have had in this period, e.g. 5% up.

This gives you the answer to where are we now and what were we supposed to be at now. 

We now have measurable results.

Now one of the best and simplest methods to proceed is to use the “5 Whys.” approach, which was invented by Toyota. It is easy to do, grab a big sheet of paper and a couple of people together.

Now ask why our actual and projected figures are different?  

> Write the answers down. Draw pictures too.

> Put a star near the ones that you think are good.

Now look at your answers and say again, why are these answers.

> Again write the answers down. 

Now keep going with your whys until your answers become pointless. Generally, this takes about five attempts. 

For example 

Why did not sell much XYZ product?

Answer because we displayed prominently products that were not good sellers.

Why did we display these products that were not good sellers?

Answer because we went for the price rather than....

etc

 

Now use what you have learned.

 

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Different types of margins

POS SOFTWARE

Margins are often considered as being the most important KPI in stock control.

 

 

Like everything, once you get into it, it gets more complicated as different shops tend to have different needs and requirements. So we have a few different types of margins actually, and it is useful to run through them.

Gross profit margin

This is the difference between profit before expenses such as salaries, rent, advertising etc. you earned, and the cost of goods sold generally expressed as a percentage of revenue.

= 1 - (cost of the wholesale price) /(revenue) 

for example, you buy the goods for $35, you sell them for $60, so it becomes

1- 35/60 = .42 

Which as express as a percentage: 0.42 * 100 = 42%.
This is how you calculate gross profit margin

Your suppliers can give you this figure, and I strongly suggest that you ask for the gross profit margin, not the markup which some suppliers will provide you as it inflates their profit figure.

Actual margins

Is the actual margin with discounts included that you are getting? In the real world often what we sell at, is not what the supplier recommended prices are and as I discussed it already here, click here for more details.

Net profit margin

Is much harder to determine and involves you putting into the costs such items as salaries, rent, advertising etc. into the costs. The problem a point of sale software has is that much of this information is not available to it. Your accountant should be able to give you an approximate figure which will be in the form of

Your cost for the shop = factor x (cost of wholesale goods) + (fixed fee)

As the fixed fee is minimal on each item sold, what most people do is multiply the cost of wholesale goods by the factor. So say the accountant said the factor is 18%, the  actual margin is for example 35% for the item above then your net profit margin for this item is 35%-18% = 17%

This is a very useful figure to keep in the back of your head, as if you know an item has a margin of 15%, then if your is 18% which is often what it is in retail, you are losing money on that item. Note of course if you have lotto, you may need a few factors.

There is, of course, no definite answer to what is a good margin. It depends on your business, so I suggest you check with your respective industry and the ATO benchmarking here for an idea of what margins you should be getting. 

 

 

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Lastest newspaper delivery fees announced

POS SOFTWARE

Looking at the new distribution fees, they vary but as a first-level approximation, I would say its average of just less than 1.5%

Surely they should be more if only because the Australian inflation rate in 2019 was 1.90% but almost certainly NewsCorp views are that this is all the market could afford. They may be right.

 

 

 

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Valentine's Day 2020

POS SOFTWARE

Are you ready for Valentine's Day!

 

This year,  IBISWorld forecast predicts Australians will spend $1.09 billion on Valentine's Day, the average Australian consumers are expected to spend $43.61 on someone special. If so to give you a feel of its size, that is about 40% of  Boxing Day.


I believe it as when I look in google trends and put in Valentine's Day, for Australia over the past five years, you will see this graph which shows that there is a lot of interest, comparable to previous years.

 

So I hope you have some plans to take advantage of this interest.

One point I can assure you is that you don’t have to be in the chocolate or flower industry to win some of that business.  We have a client that sells a lot of mobile phones on that day so try to find an angle.

Start off here and see in your point of sale software, how your existing stock goes for Valentine's Day and ask yourself do you have this stock?

The report I recommend you look at is the Top N stock report which gives you among many other details the top-selling items.

Go to Register Reports marked in green.

 

Select stock and now you will see two reports, click the one on green first. The purple you should hold in memory as you may need it before placing an order.

 

 

Now select last year, for this date until Valentine's day (see yellow arrow)

Here I would suggest looking at the top 40 items, which for most shops should be plenty.

Now you will get a report with your current stock on hand figures to see how your shop looks stock wise for Valentine's day. You also have supplier's details too which you can investigate with the Top N stock report by suppliers that I spoke about above.

Another idea to consider is I did this report for last year, it's a good idea to do it for other years as well.

Now gather the items together as Valentine’s Day is known for having plenty of last-minute shoppers. So you need to make easy for them to find appropriate goods in your retail store. If possible make it a spot in the shop with plenty of red.

Happy Valentine’s Day retailers! And happy selling! 

 

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Backup

POS SOFTWARE

Yesterday, one of our clients went down, and they had no backup. We had to rebuild the hard drive and managed to get most of it back. Then after patching, we managed to get them going.

Every site without exception should have a backup. There was a court case where the judge ruled that backups are the user's responsibility, and it not done it is misuse.

Okay, why should you backup here would be a few reasons?

- A computer is a mechanical device; any part of it can fail and go down. 

- A virus/ransomware can wipe out your computer. Our clients get now about one major attack a week.

- You accidentally destroyed your information

- Power surge, I have seen computers fried.

Along as you have a backup, we can put together a computer, send it out to you, and you can often be running the same or next day.

Here are four rules for backup

- Make sure you are doing *regular* backups, we have had to sometimes restore people with old backups as such they lost their records for several days of trading. 

- Make sure you have at least one backup secure in another physical location, e.g. home, you never know what can happen to the shop, e.g. fire.

- Do not rely on "the cloud". The cloud is simply someone else computer, and it can go down too, for peace of mind, I would strongly recommend that you have a physical copy.

- Make a cloud backup, cost nothing with our system, and it is fastest and convenient to use.

 

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