pos service startup questions (new member) 1

[zoomsix]

Hi,
I just discovered these boards and have been quite impressed with the wealth of information available on POS systems here in this category. I recently got the idea of getting into full pos systems for restaurants. I think i have the connections necessary to get the customers, but i know nothing about POS. I am fairly computer literate however, mainly it is a hobby. The company i would start would be in the business of installing (and i guess servicing?) the POS systems. I have no idea where i would source them.. that is mainly what i want to find out.

Basically, if someone could outline the industry and what i need to do to start, that would be much appreciated. From what i gather, i can either go with standard computers & screens and run POS software on them, or i can buy proprietary stuff that packages it all in one. What is recommended for a company like the one i want to start and what are some vendors to consider?
how is the industry currently structured? is it mainly software&hardware vendors selling to small companies that install and support or do companies like aloha provide the support and installation as well? How much support is usually involved (ie how stable are pos systems)? Is there even any money in it?

Thanks a lot for any input thanks !

 

[daniellee4874]

Are you going to be developing your own POS software, because it can be a long process. A lot of people have the misconception that the software is the most expensive part of a POS system. While the software is usually the most IMPORTANT part of a POS system, most of the money spent on POS systems is on the hardware itself. Depending on what market you will be catering into (low end resturants vs. high end resturants) the money spent on making the POS system look "nice" integrated into nice furniture can cost tenfold of what the software costs.

As far as installing POS systems, there can definetly be a market for that. It is simply impossible for many companies to fly around and personally install POS systems.

Servicing is a whole different ball game. For very simple single location resturants, there is no really needed service. But for multi-location resturants, there might have to be servicing involved. Several resturants (owned by the same owner) in close proximity might want to share customer data, inventory, or various things; so there is more room for "servicing" to happen.

You would be best off probably partnering with a company. Only because development costs of GOOD pos systems can be very high. If you are familiar with software development and know what the costs involved will be, you might want to develop your own software. Just realize it might be as more than 18 months to work out all your bugs in the meantime. Your best luck would be to partner with someone that already has experience in the industry and can give you guidance through your whole process. I'm in the Los Angeles area if you ever want to talk.

 

[zoomsix]

Thanks for the response.

Yeah, i'm not looking to do development or anything like that. I want to buy already existing technology, and install it in restaurants for a charge.

How would i go about partnering with a company? What are some good companies to deal with? How exactly does a partnership like this work? I'm not really looking to work exclusively for a big name... i want to buy their technology and possibly their support/service (not sure if technology is sold with support) and sell it to my customers.

"Depending on what market you will be catering into (low end resturants vs. high end resturants) the money spent on making the POS system look "nice" integrated into nice furniture can cost tenfold of what the software costs."

I never thought of this aspect of it, very interesting. Obviously, i have not put a whole lot of thought into it... i came here as kind of a starting point.

You say there is not much service involved.. does this mean that POS systems are usually not sold with free support? Meaning, if i install a POS system for a client and it breaks, the fixing is extra revenue or is is standard for installers to provide free support afterwards?

Again, thanks for the response. I'm actually on the other side of the country (florida).
any more input is appreciated.

 

[daniellee4874]

Well at my father's company, we typically charge in between 300-800 dollars a month for service. This service typically can be as simple as stopping by twice a month to a location to literally fixing every aspect technology related. Our company deals mostly with the garment industry. Everything from wholesale distribution to the retail stores themselves.

You should look into licensing a POS system with a company. For instance, you would pay the software company probably a reduced price for the software and you would handle all the hardware side (setting up etc...). Partnering yourself with the right design/building contractor might become critical as you enter specific markets.

We are currently licensing out technology (the backend of one of our websites:

http://www.fashiongo.net)

to the South Africa and South American but they are paying 7 figures up front. Licensing can vary from $ to $$$$ so it would be good to handle all the legal work up front so maybe you have a partnership set for at least the next 18 months or so if you take that road.

Send me an email at daniellee@compsolution because I might be in Florida during May for the SPESA/ Material World convention.

 

[zoomsix]

So you suggest licensing software out and running it on standard computer hardware in place of partnering with companies that provide both? What are some big names in POS hardware equipment ?

 

[daniellee4874]

I can give you more specific names later on but you might just need to test out several different POS hardware equipments to get a feel for what you are more comfortable installing.

The only reason i suggested you to license software is because if you get the software and hardware from the same company, they will be making a cut on the hardware (less money for you). But if you dont want to deal around with finding your own hardware, you might be better off partnering with a company and getting the hardware and the software from the same company.

 

[posrescue]

You should first define exactly what you want to do and what market you are after. Many POS software pieces are packaged and marketed as being ready to take on any scenario but fall short in many areas. The main catagories are Quick Service, Delivery, Small Scale Table Service, Large Scale Full Service/Fine Dining, Corporate/Franchise, Country Club/Membership. Of course many restaurants cross over 2 or more of these.

If you are wanting to sell and support complete POS systems make sure you have the available cash reserves. You will need to be able to cover new systems as well as stocking spares, parts and supplies. There is also the slow payer and the potential of a no payer. You have to be able to absorb this. It is hard for a startup to get large deposits!

Be carefull when selecting POS software. Look for a provider that is investing time and money in development. There are hundreds of choices but most are not what you want to stake your financial future on. Understand that many companies will want your money and will say what you want to hear, (think used car buying). Kick the tires, check for leaks and consult a mechanic.

 

[Circle9]

I recommend using Radiant for both software and hardware, they offer great terminals and great Aloha software. We just started using the software and have encountered no problems. Their website is

http://www.radiantsystems.com.

Good luck

 

[posispecialist]

I have just started a POS business. I was a programmer and installation tech for a POSitouch dealer for 15 years. If you want to know what it takes to get started you can get in touch with me. What part of the country are you in?

Berny