Blog | May 21, 2013

A Wake Up Call For POS VARs & Vendors

By Mike Monocello, editor-in-chief, Business Solutions magazine
Follow Me On Twitter @monocello

BSM-Head In Sand

According to Lynn Skurla of Skurla's POS Solutions, there's an elephant in the room and many POS dealers (and POS vendors) are ignoring it. The elephant is the trend of low-priced tablet-based POS solutions that have flooded the market. "I think the POS dealer, especially the dealer who sells into the tier 3-4 market, is in serious trouble unless we figure something out," she warns. "Many customers don't want complex systems of the past. They don't use 90% of the capabilities of traditional POS systems. The 10% they do use is what's showing up in these new apps." 

"Many customers don't want complex systems of the past. They don't use 90% of the capabilities of traditional POS systems."

"I also think that the traditional POS vendors need to act now," she continues. "If they don’t provide the products that businesses and consumers are demanding now, then businesses, VARS, etc. will go elsewhere for their retail technology needs. Look at how many new players are in the POS market now -- companies that you would have never in a million year thought would be viable competitors in this market."

Skurla knows she isn't alone in her thinking. She's been spending much of her time recently speaking with other dealers about how they're handling this trend. "Everyone knows this is happening, but no one is talking aloud about the reality of the situation and asking 'where do we go from here?'”    

Rather, the topic is shared and discussed privately via email strings between friendly dealers or in side conversations at trade shows. Many aren't talking about it at all. Perhaps many POS dealers are taking my grandfather's tactic when it came to visits to the doctor. "If I don't visit the doctor, then he can't find and tell me what could be wrong with me," he reasoned. Never mind that ignoring a problem doesn't cause it to cease to exist.

The facts are that these mobile solutions are here to stay. Many retailers, whether they need them or not, want mobile solutions if for no other reason than the cool factor of using an iPad in front of a customer. Additionally, the low prices of these new offerings are established. There's no going back.

The saddest thing to me is that the POS industry (hardware/software vendors and the dealers) should have seen all this coming, being closer to the industry than any of these app startups, right? It's a shame that when the market had a need/desire, the need was met not by an industry incumbent, but by outsiders. Now, the traditional POS industry is playing catch up, trying to figure out how to compete against this competition that could have been crushed before it was ever created.

I wish I had an answer to this problem. I don't. I do, however, have some advice: don't bury your head and ignore the situation. Commit some time and energy to this problem. Attend shows like RetailNOW where you can find education on growing your business and network with peers fighting the same fight. Share your thoughts and best practices with others. As a POS dealer, you still are well-positioned to best serve your existing customers. Act now before those customers become someone else's.

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