I have had some ask whether they should turn off their current POS auto-ordering and switch to an online AI tool. My answer is no. We tested an online AI for stock ordering, but it wasn't as good as the built-in AI ordering in our POS software.
Now I am going to put aside the immediate question of costs. Your POS System AI is free, but the online AI costs; we will discuss this in another article.
Key Takeaways
- Your current POS auto-ordering is already a form of AI.
- It is built for one job: working out what stock to order.
- Online AI needs prompts, setup, and checking before it becomes useful.
- If your stock data is wrong, any ordering system will give bad advice.
- Online AI can also get local context wrong unless you guide it carefully.
- The best way to test online AI is to run it beside your current system and compare the results.
Why Is a Purpose-Built POS Ordering System Better Than Online AI?
The automatic ordering in POS software is AI. We were the first in our market space to introduce AI. It uses your sales history, supplier details, pack quantities, and seasonal patterns to calculate stock orders. That matters a lot because it is built for one specific job, not a hundred different jobs. An online AI tool can write emails, answer questions, and write software. Our ordering AI does one thing: it determines which stock your shop should order. That narrow focus is a huge strength.
What Does It Take to Set Up Online AI Ordering?
This question is often overlooked: the setup time. You do not just turn on an online AI and get perfect purchase orders. You have to spend hours writing prompts, explaining your specific shop rules, and checking the results. If you want to try something like this, let me know, and I will give you some prompts to test out for your shop. You will need to write suitable prompts that explain your business rules, and keep checking the output until you get it right. If the prompts are weak, the answers will be weak too. Unlike your current ordering system, it does not already know your business rules unless you provide them; they must be in your prompt.
Here, what I hate is that AI sounds confident when it is wrong. It is programmed to please you and will try to please you even if it has to lie. I am currently writing a blog post on this point, which will be released soon with examples from retail, drawn from actual examples our clients have shown us. Suffice to say, any AI today gives somewhere between 0.6% and 2% hallucinations on top of errors. The difference here is that, unlike your current AI automatic ordering system, the online AI does not have business rules to catch these errors. This means that the online AI system, as it is unsupervised, gives you a significant operational risk for your retail stock management.
We also found that online AI can miss local context. In one test, it returned results based on North American holiday timing rather than Melbourne, Australia. We had to change the prompt to force the right local context.
You Test Online AI Against Your Current System?
If you want to test it, do exactly this. Grab a historical weekly sales report with some history behind it, run it through an online AI tool, and compare those results with your current automatic ordering.
Do not switch first and hope for the best. Test both side by side and compare the order quantities, the time required, and the number of changes you need to make by hand. No one ever got in trouble by testing AI too much before using it.
What is the Real Question here?
The real question is not whether you should use AI. The real question is whether you should replace a specialised ordering AI already built into your POS System with a generic online AI tool that needs setup, prompting, and careful checking.
Conclusion
We all know no system gets it right 100% of the time. Sudden weather changes, local footy finals, or supplier delays will always throw a spanner in the works. That is why the best approach is to still use a human being to review the orders.
For most retailers, I would not recommend that change without a very good reason. If your current system is working, be careful about turning it off just because something newer is available.
If your current ordering is not giving you reliable results, or you are not sure your reorder settings are correct, book a free consultation so we can review your setup properly. Details on setting up your automatic orders can be found here.
Written by:
Bernard Zimmermann is the founding director of POS Solutions, a leading point-of-sale system company with 45 years of industry experience, now retired and seeking new opportunities. He consults with various organisations, from small businesses to large retailers and government institutions. Bernard is passionate about helping companies optimise their operations through innovative POS technology and enabling seamless customer experiences through effective software solutions.
