Is it time for a new POS System?

Investing in technology is one of the biggest business decisions you’ll make. You want to ensure your business is benefiting from what’s available, but you don’t have the budget to buy every gadget that comes to market. For a retailer, this technology decision often hinges on when to upgrade the POS equipment.

Here are some things to consider that will help inform your decision about when it’s the right time to upgrade and choose the right POS system for your business.

If you have these pain points, then it’s time to upgrade before losing those sales.

Every retail operation experiences pain points that indicate their POS equipment might not be providing the same level of service and efficiency as needed. For example, your sales volume may be on the rise, but you notice there are glitches in payment processing. These glitches might include credit cards that inadvertently get declined even if there is nothing wrong with their account or processing takes much longer than normal.

Screen freezing, slow receipt printing, and other issues that affect uptime may cause customers to grow impatient and impact how they see the shopping experience with your retail brand.

If you are spending too much time on troubleshooting when you could be engaging your customers or working on other marketing strategies, it’s a sign you need to upgrade your POS hardware and software.

6 Ways Using Apps with Your POS System Streamlines Your Business

If you are concerned about security and data breaches, then it’s time to invest.

With so many data breaches and responsibility resting squarely on the shoulders of the retailers who experienced them, you may want to upgrade your POS equipment to minimize this risk. Older POS equipment may be more vulnerable to thieves and allow them to break in to your system.

However, new POS equipment has been enhanced with EMV security and other solutions like tokenization and P2PE (point to point encryption). This will reduce the risk of skimming, counterfeit cards, and various hacking measures.

If you are looking for ways to boost your customer loyalty and revenue, new POS equipment may be the answer.

The latest POS software can double as a marketing tool, offering a way to maintain a customer database to provide personalized deals, suggestions, and coupons. You could also use this additional feature to create a loyalty rewards program to boost sales and keep customers coming back to you. Another feature provides you with a way to expand your payment options, which can also attract and retain more customers because they appreciate you now accept mobile wallet payments or other type of alternative payment method.

If your customers always need to stand in line to check out, then you need to upgrade your POS processes now.

Think about the possibilities of a mobile POS (mPOS) solution that allows your cashiers to walk around your store and approach customers rather than shuffling them into a long line. Or, if you have wait staff, then you can give them a tablet to process payment right at the table rather than disappearing for what feels like forever to the restaurant guests. New POS equipment can allow you to do this, creating a more engaging, positive experience for them.

If you can’t process chip card payments, then get a new POS ASAP.

Most banks have issued new chip-enabled debit and credit cards by now, so it can be a real revenue killer if you can’t process secure transactions because your card reader doesn’t offer the functionality. Minimize your fraud risk and protect your customers’ card data by upgrading to a POS system that offers EMV processing.

If you are having inventory tracking issues, that’s another sign that it’s time to upgrade that POS equipment.

Does your inventory tracking not seem as accurate as it once had? If you can’t reconcile the difference between what you should have in your inventory and what your POS system says you have available, it might be time to upgrade. A new POS system uses advanced technology to offer accurate real-time inventory management to improve your efficiency, costs, and customer satisfaction.  

POS Upgrading

Work with your payment processing partner to understand what type of POS upgrades are available and what these options can achieve for your business. If you have any of the above issues or pain points, then now is the time to act and add the technology solutions that add efficiency, enhance the service experience, and build customer loyalty. 

Clover, the best and most affordable POS system for small business

Contact us today to learn about the variety Clover POS offers.  Mobile, stationary, WIFI, wireless, wired, cash drawer, Mini, Flex, bar code readers, printers, and more … Clover offers it all.  We can customize your POS solution to fit your needs and you get hundreds of Apps available to you through the APP market.  It’s all at your fingertips to do your own customization.  

To Cloud or Not to Cloud

Many articles pass by my desk, some good and some not so good.  On occasion I find something worth sharing.  This article appeared on our processing partner’s (BluePay) blog on August 3rd of this year and I find it a worthwhile read for business.

What Part of Your Small Business Should You Move to the CloudRunning a small business means everything is on a smaller scale. However, that doesn’t mean it’s any easier. This is especially true if you are a one-man band or have a few remote employees. In managing your work and life, you are most likely always on the go and tuned into your mobile device. It’s the migration to the mobile world and remote resources that led to the emergence of cloud services.

Prior to that, history tells us that business people had to carry disks with files on them, and more recently flash drives and memory sticks. The problem with this was you could never really be sure if you had the most recent information. That meant everyone may not be “singing from the same song sheet” so to speak. Clearly, it wasn’t the most efficient process, but it was what existed prior to cloud services.

Enter cloud services, which offer a way to access real-time information like files, project work, and any type of document anywhere in the world at any time from devices that have been connected or provided access. That alone can be a game changer for any business owner that is considering moving their business to the cloud.

However, the question is whether the whole business should migrate to the cloud and go all-in on the technology investment. Here are some things to consider about moving to the cloud.

Moving the Entire Business to the Cloud

The decision to move the entire business to the cloud is typically undertaken by larger enterprises that have numerous locations and thousands of employees to include. They typically have significantly more files, projects, and data that also has to be shared, making a complete migration to the cloud a viable investment.

That’s not to say a small business can’t do the same and realize the same type of return over time. However, there may be upfront costs that make it difficult to move everything. Also, when you move everything to the cloud, there can be considerable downtime to complete the process. While a larger business may be able to absorb this period with no business, a smaller one may become financially impaired.

Stepwise Movement to the Cloud

An alternative is to still consider migrating your entire business to the cloud, but doing so in a stepwise fashion. With each phase, you’ll experience far less downtime that might adversely impact your business. Additionally, this will help you budget more effectively for the upfront costs associated with investing in cloud services and platforms.

Look at applications you already use to see if they offer cloud capability. These include accounting software like QuickBooks and communication services like Skype. Collaboration and project management apps like Slack and Basecamp are cloud-based, as well as calendars like Office 365 Calendar. It’s a good start to try these out for their cloud capability so you can see the benefits of moving to the next functional layer in your company and transitioning those applications to the cloud. Since people and processes tend to be one of the most challenging aspects of migrating to the cloud, this gradual approach will help with the adjustment period.

Key Cloud Services to Focus On

You can also leverage the benefits of cloud services by only opting to move a few functions. Start with those functions you most need to access from anywhere. They will deliver the most value, and they will help prepare your business when every device is connected. For example, you could start with email, computer files, accounting system, and back-end functions.

In fact, you may already be using a cloud tool and not realize it. Dropbox is one of the most commonly used, and it doesn’t require other aspects of your business to be in the cloud. This means you can leverage a remote team to help you rather than having on-site employees. Also, the aforementioned apps that may already have cloud capability may be enough for your business in terms of productivity improvements that you don’t have to consider any other cloud services until you grow further.

Things to Remember

While much improved, there are still risks related to security, availability, and data loss. As a small business owner, your best strategy is to do your due diligence. Thoroughly research each cloud service provider before signing up to work with them and entrusting them with all your information.

Make sure they can scale with you as your business grows. Also, by only moving certain functions, you can create additional backup strategies just in case the unexpected happens. Lastly, don’t assume the most expensive cloud services are the best because some of the low-cost cloud tools are just as great and maybe even better for what you need.

Transitioning to PIN requirement for credit

Chip-and-PIN Credit Cards — the Final Nail in the Coffin

Swipe and sign is already on its last legs — but there is one final piece of the puzzle that will likely speed up the demise of this time-honored ritual.

Already the default worldwide, Chip-and-PIN credit cards are becoming more popular in the United States — the last major market to adopt Europay, Mastercard and Visa (EMV) payment processing.

These chip-enabled cards offer much greater fraud protection, since:

  • The embedded security chip is very difficult to clone.
  • The EMV card never leaves the customer’s hands.

Most important? Authorizing each purchase requires a personal identification number (PIN) that only the customer knows.

This final step is far more secure than requiring someone’s signature. As Chip and PIN becomes more widespread throughout the U.S., the retail and payment card industries will likely abandon swipe and sign forever.

The bottom line to your business is more frequent requests coming through your point-of-sale system for customers to enter a PIN, whether it be credit or debit.

Daylight Savings Time Equipment Update

DAYLIGHT SAVING TIME ENDS SUNDAY, NOVEMBER 5TH, AT 2:00AM!

Don’t forget to turn your clocks back one hour, and remember to do this for your payment terminals, too. See below for some quick instructions.

First Data Terminals image004.png

From “Swipe or Insert Card” Screen
  1. Tap the settings button (orange button with wrench and screwdriver icon)
  2. In the System Menu, press “Date/Time”
  3. Enter Date in MMDDYYYY format, press Enter (green key)
  4. Enter Time in HHMMSS (military time format), press Enter (green key)
  5. Press the Red “X” key until you are back at the home screen
  6. Updated Date/Time should now appear

Verifone Terminals verifone-terminal-rev.png

From “Sale Refund Void” Screen
  1. Press Enter
  2. Press F2 for Setup
  3. Enter Password (1, Alpha, Alpha, 66831), Press Enter
  4. Press More (purple key) until you see “Date/Time”
  5. At Setup Screen, press “F” key associated with “Date/Time”
  6. Enter Date in MMDDYYYY format, press Enter(green key)
  7. Enter Time in HHMMSS (military time format), press Enter
  8. Press “Clear” twice until you are back at the home screen
  9. Updated Date/Time should now appear

New Internet Security for IP Transactions

A new internet security standard went into effect on January 1st of this year. It is another layer of security to keep the bad guys out. It is called SHA 256 and it layers security exponentially.

This change only affects businesses using the internet for transmission of data, not old fashioned land lines. If you are experiencing delays or processing challenges since we turned the calendar, get in touch with us for a fast and easy solution.

Debit Card Processing and Regulation

Whenever a customer swipes a debit card at one of your POS terminals, that transaction results in an interchange fee that you must pay to the card-issuing bank. Historically, these fees have averaged about $0.44 per transaction; and like most charges, the cost is ultimately passed onto consumers.

However, as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, legislators introduced the Durbin Amendment in 2010. Thanks to this bill, retail stores now pay closer to $0.21 per swipe if the card-issuing bank carries $10 billion or more in assets.

How Does the Durbin Amendment Affect Consumers?
In theory, the Durbin Amendment is supposed to save consumers money. With lower interchange fees paid by merchants, there are fewer charges to pass on to end users.

Though according to George Mason University, retail prices haven’t changed dramatically after passage of the Durbin Amendment. In fact, consumers may actually pay more due to “hidden” charges.

Unable to collect as much money through interchange fees, card-issuing banks began exploring other ways to replace an estimated $14 billion in lost revenues.

Common strategies include:

Reducing card-based perks and rewards.
Eliminating free checking and other complimentary services.
Increasing consumer banking fees.
Introducing monthly account charges, including inactivity fees and minimum threshold penalties.
What Effect Has the Durbin Amendment Had on Retailers?
Merchant reviews of the Durbin Amendment have been mixed, with opinions largely determined by retailer size and transaction amount.

Retailer Size
Once the Durbin Amendment passed, banks began consolidating their services and eliminating many of their most popular solutions. As a result, smaller retailers now have fewer banking options from which to choose.

By contrast, larger retailers often bring more clout to the negotiation table, making it easier to qualify for better rates and receive custom-designed payment solutions that are unavailable to smaller or low-volume retailers.

Transaction Amounts
When processing purchases over $38, swipe fees have gone down — about 45 percent on average. Yet when handling smaller transactions, many retailers now find themselves paying substantially higher interchange fees than they did before.

This is because most banks have abandoned traditional percentage-based pricing in favor of using maximum thresholds for smaller purchases. A $4 widget, for example, might result in a fixed charge of $0.21 instead of using 1 to 3 percent of the transaction amount.

EMV is here.

October 1st is around the corner and the new EMV rules take place. Don’t panic if you don’t have new equipment in place … you may not even need to make a change. It is simply a risk tolerance issue. If you are a coffee shop you are not a likely target for someone with a stolen card, and even if you are, your risk is minimal. Be safe and get a picture ID if you aren’t sure or it the transaction is large. If you are selling electronics, you should be following the new rules for reading EMV (computer chip) cards as you are a likely target. It is a common sense issue as we all begin the migration toward more secure transactions. Call us and we’ll help you navigate through the change.

EMV is not a law, it is not mandatory, it is a risk decision

The new rules for EMV processing take effect on October 1st, 2015.  These are simply rule changes that shift the liability from the bank that issued the card to the merchant if the merchant does not have equipment capable of reading EMV (computer chip) cards.  The only time the liability shifts is if it is a counterfeit card or, in some cases, card not received by cardholder.  The equipment needed is not expensive and in many cases may be provided at no cost.  The challenge lies with the processors and their ability to support the equipment.  It is a work in progress.

Let’s keep some perspective.  If you are a business that sells high dollar electronics, televisions, computers, etc., you definitely want to be compliant on October 1st.  If you are a business selling flowers, coffee, fast food, etc., you aren’t likely a target for someone looking to steal.  Even in the rare case they would target you (which would be extremely rare) your loss would be minimal.  So keep things in perspective when making your shift to EMV supported equipment.

Direct Payment Systems is here to help make the shift smooth and inexpensive.  Contact us for our view on how your business may or may not be impacted by this rule.

Direct News from Direct

I found this article at money.usnews.com that talks about the EMV issue in greater detail.

Coming Next Fall: More Chip and PIN Cards in the U.S.

When fraud liability shifts to merchants next October, expect more EMV cards and new payment terminals.

Starting next October, payment terminals will likely be required to accept chip-based cards.

By Susan Johnston Oct. 28, 2014 | 9:21 a.m. EDT + More

Americans traveling in other parts of the world are sometimes bewildered to discover that their debit or credit cards don’t work at automated kiosks that use new chip and PIN technology rather than magnetic stripes. (The technology is also referred to as EMV, which stands for Europay, MasterCard and Visa, the three card brands that created the chip in Europe and Canada.)

EMV cards have been the standard in Canada, Europe and other parts of the world for several years now, but they’re not as widely used in the U.S. That’s likely to change next October, when liability for fraud shifts from U.S. card issuers to merchants if merchants don’t upgrade their payment terminals to properly accept chip-based cards. (Some smaller merchants may be slow to adopt the new technology if they feel it’s less expensive to assume the fraud risk than update their payment terminals.) President Barack Obama also recently signed an executive order to embed this technology in all government-issued credit and debit cards.

Instead of swiping a magnetic stripe, consumers insert their EMV card into a payment terminal until the transaction is completed. This reduces the risk of fraud for in-person transactions. “Magnetic stripes contain data that is simply read by a swipe terminal as the card passes through, similar to reading a very short piece of a VCR or tape cassette,” explains Chris Camejo, director of assessment services for NTT Com Security, an information security and risk management company. “The data on a magnetic stripe can also be overwritten, just like a tape cassette. The devices to rewrite magnetic stripes can be bought online for a few hundred dollars, so it makes cloning cards cheap and easy.”

Chip-based cards also contain cryptographic keys, Camejo adds. “Rather than just reading data off of the card, the terminal sends transaction data to the chip, which processes it with the cryptographic keys and then returns the data to the terminal.” Cloning these cards is much more expensive and complicated, so fraudsters tend to exploit the lower-paying fruit, like older magnetic stripe cards.

Chip and PIN cards also require a second authentication factor: the customer’s personal identification number. “This means that an attacker who just steals the card number can’t use it unless he manages to get the PIN as well,” Camejo says. “Theoretically, our current magnetic stripe cards have a second authentication factor as well – the signature – but those signatures are rarely subjected to much scrutiny, especially in the age of self-checkout lanes.”

As U.S. customer cards expire, some banks and financial institutions have already begun replacing the old magnetic stripe cards with chip-based cards. (The cards also have a magnetic stripe as a back-up option in case you visit a country or a merchant that doesn’t accept chip-based cards.) Often, though, these are chip and sign cards rather than chip and PIN cards. “These have the anti-cloning benefits of the chip but lose the strong second authentication factor of the PIN,” Camejo says. “These cards can also be very difficult to use at automated kiosks in European countries that utilize chip and PIN almost exclusively.”

Nick Clements, a former banker and co-founder of MagnifyMoney.com, a comparison website for financial products, predicts that while chip and sign cards are the first wave of chip-based cards in the U.S., issuers will eventually shift to cards that require a PIN. “Card issuers don’t have to issue the chips, but they very much want to, because it’s better for security and consumers want it more and more,” he says. As countries shifted to chip and PIN cards, he adds, their fraud losses decreased. “The United States right now is really the weakest from a fraud protection standpoint,” he says.

If PINs become de rigueur, restaurants will need to adopt the portable card readers used in Canada and Europe so patrons can pay their bill at the table rather than handing over their credit cards – a move Clements feels will ultimately benefit consumers. “It’s shocking how often you give your credit card in a restaurant,” he says, “but this way, you never lose sight of your card.”

 

If chip and PIN cards are more secure than magnetic stripe cards, why aren’t they more common in the U.S.?

Cost is a major concern for card issuers and merchants. “EMV cards are significantly more expensive to manufacture than traditional magnetic stripe cards, which may explain why many banks are still not offering them despite the fact that the credit card brands are expecting them to be fully deployed by October of 2015,” says Dave Oder, president and CEO of Shift4, an independent payment gateway. In fact, TSYS Acquiring Solutions, which offers payments solutions to financial institutions and businesses, estimates that replacing magnetic stripe cards will cost issuers $3 billion, and merchants will collectively spend $2.5 billion to replace their payment terminals.

And even after issuers and merchants pay billions of dollars to transition to the newer technology, it’s not a cure-all for fraud. “It will likely reduce instances of card-present fraud because it makes it much more difficult – though not impossible – to use duplicated cards,” Oder says. “Will it stop breaches like the ones we’ve been plagued by recently? Absolutely not.” Chip and PIN cards can help prevent fraud for in-person purchases, but they don’t prevent fraudulent purchases online. E-commerce is a multitrillion dollar business, and growing, so merchants and card issuers will need to find other ways to address that issue.

As Clements sums up EMV technology, “it’s not invincible, but it’s better than a magnetic stripe.”