Technology solutions for the modern retailer

Next Generation Retail talks to a panel of experts about how a retailer’s point of sale systems can improve in-store operations.

What challenges are retailers faced with when implementing point of sale (PoS) technologies?

Tony Saunders. It's all about choosing the right PoS technology for you - not because it's innovative or hot but because it delivers real benefit now and potential returns in the future. Flexibility, security, scalability and configurability must be key.  Issues are then largely associated with deployment - system integration and migration; and staff training.  The challenge is doing all of this without incurring downtime or loss of sales.  When it comes to choosing a PoS partner, consultancy, support and service are as crucial as technical features and benefits.  

Andrew Blatherwick. Replacing PoS is always a difficult decision as it is a business critical solution for a retailer. The change has to be managed well to create as little disturbance to the retail operation as possible. Invariably a retailer will change his hardware at the same time as his PoS software, thus out of hours working will almost certainly be required. The critical element is to make sure that the correct planning is in place, so the PoS selected is aligned to the business requirements and the staff can be trained effectively. This last point is always of high importance; with the high turnover of staff in retail, a solution like Argility's that provides retailer specific process workflow and intuitive user interface is vital to ensure that new staff can be quickly and efficiently active on the shop floor.

Smaller and independent retailers may not have the budget to utilize payment solutions. How can point of sale technologies directly benefit a business and what advice would you give to retailers looking to improve their PoS solutions?

AB. Smaller and independent retailers today have the ability to obtain and utilise much of the sophisticated PoS functionality of the major players. Argility have a solution that has been designed and developed specifically for this market which incorporates not only a PoS but a very rich back office and head office capability that effectively forms a total solution for small store groups with up to 50 stores. The PoS solution large or small can provide significant insight into the retail operations, ensure security is maintained, minimise fraud both internally and by customers, provide improved customer service and experience, not just in speed through the checkout but also in the prompting of the operator to make sure there are no missed opportunities, loyalty schemes and customer relationship management. With Argility's larger solution this can also provide extensive account management and trade management if so required and significantly enhance the promotions capability and back office functions if a retailer has an old legacy merchandising solution they are not yet ready to replace.  

TS. Even if a retailer has a limited budget, they should still invest in payment technology for the many business returns.  Offering expedience, convenience and versatility, today's electronic Point of Sale systems can significantly improve footfall, by increasing speed of service and customer throughput so that you never miss a sale.  They deliver a more positive customer experience and allow retailers to diversify their offering through loyalty programmes and cross selling.  Another major advantage is that card based payment systems deliver better inventory control, reporting and tracking of finances, speeding stock management, bank and till reconciliations. When weighing up the returns, smaller retailers must make sure they assess PoS contributions to all areas of their business, and not look at the financial impact of the investment in isolation.
 
Obviously, in store payment technologies must be secure in order to protect takings. How can the correct PoS technologies increase protection from theft and/or fraud?

TS. For some time, VeriFone has been suggesting that current PCI requirements do not go far enough to protect merchants and acquirer, and that existing processes present many unguarded loop-holes that fraudsters could exploit. Indeed, the PCI Security Standards Council itself is now studying a number of emerging technologies and plans to issue a guidance document on end-to-end encryption when it releases the next version of the PCI Data Security Standards (PCI DSS), due out in October. Other technologies being considered include the use of tokenisation and Chip and PIN technologies to protect credit card data and how virtualisation affects data protection technologies.  At VeriFone, we welcome this move.  While we have invested extensively in developing our ground breaking VeriShield Protect E2E encryption system, which is now an integral part of all VeriFone's new terminal products, we also believe it needn't be preclusive. For example, E2E encryption and tokenisation could, in some cases, be used in tandem to address specific customer requirements such as loyalty and product tracking, where these exist.

AB. With PCI DSS compliance today it is essential that to protect themselves retailers must select a compliant solution. This obviously covers the electronic funds transfer (EFT) aspect of the security issue. Protection against other forms of fraud is largely resolved by good quality and timely data presented in such a way as to be able to identify anomalies, which can then be investigated. Argility's full audit track of every user and every action provides the information and evidence to enable a retailer to take the necessary action against employees and customers that are independently or in collusion working against the retailer. This information can be linked to cameras if there is a real problem and this provides a very high level of security.

How do you predict point of sale technologies will evolve in the future?

AB.No matter how large multi channel becomes, PoS is still the most personal contact a retailer can have with their customer, so there is a move from Point of Sale to Point of Service. PoS technology is changing and moving to a more mobile and customer friendly environment. By this, I mean that eventually we will not have cash points or service desks that are sometimes seen as a barrier to good customer service; we will have retail staff on the shop floor with the customers. Argility solutions can already manage specifically targeted promotions down to an individual customer and deliver a very high level of personal customer interaction. The major element enabling this change is the removal of cash as a form of payment, this is a constant process as more and more people move away from cash towards cards, credit, debit or cashless but I believe this will take a further and much more important shift when payment by mobile phone reaches the mass market. The vast majority of people carry a mobile phone and research shows that this is now the most important and closely guarded item of personal possession, more so than a purse or wallet. This will, if the credit card companies allow, become the method of payment that will take us to a near cashless society; it is very secure, more so than chip and pin, personal and easy to use. From a retailer point of view it also has the benefit of being a communication device that could get then closer to their customers than ever before. Argility already has working examples of this with customers in South Africa, we are looking to extend this to the UK and I know there are also others doing so as well, this will be a major growth area for retailers.

TS.Speed, availability and performance will remain vital.  So will the ability to make transactions easier, more convenient and also pleasurable for a population whose attitudes towards technology have changed dramatically since Chip and PIN's introduction. For example, touch screen penetration now dominates mobile phones, portable navigation units, gaming and other applications, redefining the ways in which consumers expect to interact with devices.  
VeriFone's latest VX Evolution portfolio reflects many of the key trends for PoS over the next few years, such as more memory, more processing power, larger, colourful touch screens, multiple applications, flexible multi-connectivity and contact-less technology, reflecting both consumers' aspirations and retailers' stringent operational requirements.   
We will also see increased retail presence of unattended applications, self-service and kiosks as well as mobile PoS solutions as retailers strive to 'queue-bust', drive throughput, and create multiple customer touch points.

Biographies

Tony Saunders is the NEMEA Regional Marketing Director for VeriFone, the world-
leading payment solutions provider. He has spent the past 10 years in Product
Marketing for global industry leaders with the last four years in the payments sector.
Prior to working in payments, Tony spent over 19 years in the cabling and computer network infrastructure industry with senior roles in Product Engineering, Production Management, Product Management and Marketing.

Andrew Blatherwick has 20 years experience in retail with Boots and Iceland Foods as a director with responsibilities in the buying, marketing and supply chain. He moved into IT as President of E3 International then MD of JDA EMEA and is currently Executive Director of Argility (part of the UCS Group), an International software business focussed on supplying solutions to the Retail Industry.