Why You Shouldn’t Use a Retail POS System for Your Restaurant

A guest comes into your restaurant and orders a dry riesling.

Your server hands it to them in a pint glass.

They’d probably be pretty confused, right?

While technically the glass gets the job done when it comes to distributing the drink to the guest, it’s not built for that use and can lead to a poor guest experience.

If your restaurant uses a point of sale (POS) system that’s built for retail stores, you’re running the same risk of poor experience — for both your guests and your staff. Restaurant POS systems are built specifically with food service in mind and offer important features that retail point of sale systems don’t.

So, let’s dive into why a POS system is important for your restaurant and what sets restaurant-specific systems apart from retail-based POS systems.

Does a restaurant need a POS system?

In short, absolutely. Any business exchanging goods or services for money should use a point of sale system to accept, and keep track of, payments.

Take it from your peers, our 2023 Restaurant Industry Outlook Report found that 82% of restaurants are already using a POS, with 84% of new restaurants selecting a cloud-based POS system in 2022.

But a restaurant POS system can — and should — do so much more than payment processing alone. From customer loyalty programs to payroll and team management, a modern cloud-based restaurant POS acts as an all-in-one platform to improve operations and manage a productive team.

This leads us to the next question...

What are the advantages of a restaurant POS system?

Using hardware and POS software solutions that are specifically designed for your business type can ensure you’re getting the most out of your system.

Here are some of the main advantages and features of a restaurant POS system:

1. Menu management

When it comes to running a restaurant, your menu is basically the backbone of your operations. So, it’s important to look for a POS platform that offers menu management options, such as modifiers, easy menu price updates, and opportunities to 86 menu items on the fly.

Many retail-based POS systems do not offer modifiers. Modifiers are a key component of any restaurant menu, as they help make meals more accessible when it comes to food allergies and personal preferences. Plus, upsell modifiers — such as adding fresh avocado to a burger, for example — can help increase profit margins.

Also, a retail-based POS wouldn’t offer you the ability to 86 an item in the POS, despite that being a common occurrence in restaurants. This could lead to customers placing orders online for items that you’ve run out of, or your servers firing out-of-stock items to the kitchen — both of which would result in an unhappy guest.

Without basic menu management options, your restaurant may be missing out on sales opportunities and delivering a lackluster guest experience. You can streamline your operations by choosing a restaurant POS platform that can do what your business needs.

2. Integrated online ordering

Online ordering has become an absolute necessity for restaurants in the past few years. While the COVID-19 pandemic kicked off the need to move online and offer additional off-prem options, trends show that guests don’t plan to stop ordering online any time soon.

A restaurant POS system is more likely to offer direct or third-party integration with your restaurant’s online ordering platform. For example, Toast offers an online ordering system for restaurants as well as integrations with popular online ordering platforms such as Chowly, DoorDash, and Otter.

Make sure that your guests can order from your restaurant no matter where they are or what platform they’re using.

3. Inventory management

Inventory management is a must for a restaurant business. Beyond knowing how many tomatoes you have left or if you have enough eggs to get through the morning rush, restaurant inventory management platforms also help you to take control of costs — an important part of running a business in today’s volatile economic environment.

Modern inventory management tools that are built specifically for restaurants, like xtraCHEF by Toast, help to control waste, rising costs and manage your profitability with value-based inventory insights. While a retail inventory management platform may help you take stock of what you have available, it won’t take things like spoilage or food waste into consideration. Plus, where a retail inventory tool may work solely off barcodes, your paninis and specialty cocktails don’t exactly come with SKUs.

Choosing a restaurant POS with inventory management built specifically for the restaurant industry will lead to better financial clarity and centralized processes.

4. Table management

If you’re operating a full-service restaurant, having table management software built into your POS platform will help your servers streamline orders and provide a great customer experience.

With Toast, table management is a breeze. Not only does the table management screen show you which tables, seats, or other portions of your dining area are currently in use, but data is also included directly on the tables to allow the restaurant manager, servers, or whoever else is viewing the table management screen to learn more. This data includes the initials of the server assigned to the table, the current total of the order, the number of guests, and how long the guests have been at the table.

Plus, if your full-service restaurant also offers outdoor seating or seating at the bar, the table service screen on the POS allows you to swipe between the dining areas for a quick view of availability.

Being able to do all of this via your POS rather than an additional tablet makes it that much easier for your waitstaff.

5. Guest loyalty programs

Loyalty programs are a great way to keep your guests coming back for more. With a loyalty program that is directly integrated with your restaurant POS system, you can view more data, easily target certain customers with new menu offerings or sales, and get more time back in your day as a restaurant owner since the program will basically run itself after the initial setup.

While many retail-based POS platforms may offer a loyalty or rewards program, restaurant POS systems that are specifically built for foodservice are more likely to provide the flexibility you need. For example, a loyalty program like Toast Loyalty allows you to set how your guests will earn points and what each point is worth, as well as what they can use rewards on. For a coffee shop, this could mean that your guests earn 1 point for every dollar they spend, and can unlock a $5 off coupon after spending $50 for example.

You can also use rewards and loyalty programs to incentivize guests to visit your restaurant during slow days, such as by offering double points on Tuesdays.

Interested in learning more about Toast Loyalty? Check out our Getting Started with Toast Loyalty guide on Toast Central.

6. Restaurant-grade hardware

Many retail point of sale systems offer hardware options that aren’t built for the rigor of a restaurant. For example, an iPad may be great for playing games at home, but can it take the heat of your restaurant kitchen? Even front-of-house tablets can become the victim of a spill or sticky fingers, so choosing restaurant-grade hardware that can hold up against the pressures of food service can prevent any mishaps that will slow down your staff.

Restaurant POS companies, such as Toast, offer hardware solutions that are built to handle the details, the rush, and everything in-between with restaurant-grade durability that still feels good in your servers’ hands. For example, the Toast Go® 2 is a mobile POS solution that allows restaurants to take orders and payments anywhere in the restaurant while also offering spill-proof, drop-proof, and dust-proof solutions that are truly built for restaurants. Plus, other hardware options such as card readers, self-ordering kiosks, and kitchen display systems (KDS) all integrate directly with the POS terminal for a seamless experience.

What are the disadvantages of a retail POS system?

A retail point of sale system is built with products in mind — not food. While a retail-based POS will still allow you to make sales and collect payments, it may be missing key functionality — including many of the features outlined above — necessary to run a successful restaurant.

What POS do most restaurants use?

Here are some common point of sale platforms used by restaurants:

1. Toast
2. Square
3. Clover
4. Upserve
5. Lightspeed
6. TouchBistro
7. Lavu
8. Revel
9. Oracle MICROS

It’s important to note that not all of these POS platforms are built with restaurants in mind. Square and Clover, for example, tend to focus more on retail businesses while others, such as Toast and MICROS, are dedicated to restaurants.

That being said, one important factor in choosing a POS system for your restaurant is whether you’re looking for a modern, cloud-based solution or a legacy platform. Legacy POS platforms, also known as “on-premise” or “traditional” POS, store data on a local server and are not accessible outside of the restaurant. Cloud-based platforms, such as Toast, allow for more freedom as a restaurateur and fewer clunky hardware pieces taking up space in the back office.

You can learn more about how to choose between a cloud-based POS and a legacy POS here.

Why Toast is a good POS system for restaurants

Toast ranks #1 in the restaurant POS system category based on consumer reviews. G2 examines over 15 data points to determine market presence, using a combination of proprietary and third-party data, and exclusively uses consumer reviews to determine satisfaction. All of their scoring methodologies are explained in more detail on the G2 website.

In addition to being top-ranked by G2, Toast was also named the best overall POS for restaurants by NerdWallet.

Looking to make the switch to a restaurant POS system?

Download this free POS Comparison Tool to compare point of sale platforms and find the right POS system for you.

Interested in learning more about Toast? Request a free demo. When you sign up for a demo, you’ll get a customized walkthrough of Toast hosted by a product expert, a price quote built just for you, and a look at how Toast differs from other point of sale platforms.