Nearly 30 years after the first traditional POS systems were introduced using Microsoft Windows, the technology available to restaurant owners has shown little improvement. With technology booming in almost every other industry, it was as if technological innovation simply turned a blind eye to the foodservice industry.
Finally, in the past few years, POS technology has made dramatic strides. By taking advantage of 21st century technology - like cloud-based servers, open APIs, and mobile tablets - a new generation of POS companies have emerged, offering progressive systems and innovating at an unprecedented pace. For restaurant owners who are not used to seeing so many new POS options, it is very easy to get overwhelmed and to fall even further behind.
Last week, Hospitality Technology released its annual report that highlights the hottest trends in the POS market. The study is designed to help restaurant owners understand the new POS products and capabilities that have been introduced in the past 12 months and to give them a sneak peak into the developments, trends, and innovations that they should expect to see in the coming year.
This year’s report focuses on the current trends (like the adoption of EMV in the U.S.) that are creating the most paramount concerns and priorities for restaurateurs. It also names the biggest factors influencing POS upgrades, the POS functionalities that are the most important to restaurant owners, and the primary POS purchasing behaviors to expect in 2015. The Toast team pours over reports like these to dissect how our platform can address these pain points and make restauratuer's lives easier.
The graphic below, created by Hospitality Technology, highlights the most illuminating findings in the extensive study. This graphic shows how restaurants are expected to shift strategy and upgrade POS systems in 2015, helpful information for restaurant owners who don't want to be left behind by the competition.
Restaurant Owners Are Already Preparing for EMV
Restaurant executives are already preparing for the impact the transition to the EMV security standard will have on their businesses in 2015. They are focusing on features that will help them adapt to the new payment landscape. Of the restaurant executives who responded to Hospitality Technology’s survey, 56% said that enabling new payment options will be the primary factor behind their POS upgrades in 2015, followed by adding mobile POS infrastructer (47%) and preparing for EMV more generally (47%).
Mobility will be important as restaurants will likely be required to complete chip and pin payments without taking credit and debit cards away from the table in the near future. In Europe and Canada, where they have been using the EMV standard for nearly a decade, restaurants are required to complete card transactions without taking cards away from the table. Many industry experts expect to see similar practices become mandates in the United States. For instance, in a recent webinar about EMV, Heartland and the National Restaurant Assocaition strongly encourage restaurant owners to consider POS systems that offer, or plan to offer, hardware and software that can support tableside payments.
In order to make this payment process manageable, acquiring tablet-based POS software is at the top of restaurant executive’s POS priority list for 2015. In addition, the rollout of EMV technology is expected to act as a catalyst for mobile payment options. Only a few months after it was released, consumers are already starting to adopt Apple Pay at an impressive rate. The number of mobile payment options available to consumers, and the percentage of consumers who use mobile payments, is expected to skyrocket in the coming year.
Find a better POS solution and/or introduce new features and functionality
The purchasing plans restaurant executives shared with Hospitality Technology during this study show that the majority of restaurant owners are not happy with their existing POS system. Sixty-seven percent of respondents said that they plan to upgrade for more features on their existing POS system in 2015, 38% percent said that they will look to develop or purchase a mobile POS solution, 38% also said that they will research and test new POS options for possible implementation after 2015, and 19%, nearly 1 in 5 restaurant executives, said that they plan to purchase a new POS system in the coming year. Restaurant owners expect more than ever from their POS software and many are simply so fed up with their existing system that they are already planning to purchase new software.
Restaurateurs Are Turning to Modern POS Systems and A Modern Business Model
Cloud-based POS - Thirty-five percent of respondents said that they plan to prioritize cloud-based systems when they make their next POS upgrade. Cloud-based POS systems store data on web servers as opposed to legacy systems which store sensitive data on-premise, in a back office server. Cloud storage allows POS providers to offer a number of unique features and functionalities that promote flexibility.
Many cloud-based systems offer real-time reporting and the ability to make changes to things like the menu and table layout without requiring the restaurant owner to be on-site with access to the on-premise system. Owners and managers can access detailed reports and make changes to their establishment from anywhere, at anytime, using any internet-accessible device. Cloud-based POS systems also allow restaurant owners to receive remote support (so they do not have to worry about scheduling and paying an IT person to be on-site) and the POS vendor is able to release frequent upgrades without disrupting their customers' operations.
Software as a Service (Saas) - Eighteen percent of survey respondents report that they will prioritize POS solutions that are priced on a software as a service (SaaS) subscription basis. While it doesn't go into detail, this data point could suggest that many restaurant owners are tired of feeling as though they are trapped in a long-term contract or commitment with their POS systems.
POS vendors that make their software available on a SaaS model -- typically charging for the rights to their software on a monthly subscription basis -- provide restaurant owners peace of mind from knowing that they can switch to a different system at any time if they are unhappy. This model also tends to create a more positive and supportive experience with the POS vendor as they literally have to earn their customers’ business each month by providing fantastic support and improving their software on a frequent and regular basis.
What These Findings Mean for All Restaurant Owners
As a whole, these findings suggest that 2015 should be an interesting year for the restaurant industry as restaurant owners prepare for EMV and look to gain greater flexibility by modernizing their establishments through the introduction of new generation POS systems. In order to stay ahead of the curve and avoid being left behind, restaurant owners should look closely at their current technologies and consider upgrading to a POS system that is designed for the 21st century and the future of EMV.