Do POS Systems Need Internet to Work?

May 12, 2023

Differences between Online & Offline Mode for Point of Sale Systems

Point of sale (POS) systems have become an essential tool for modern retailers. These computer systems allow businesses to manage their sales, inventory, and cash flow with ease, providing managers with valuable insights into their operations.

While traditional cash registers were standalone devices that didn't require internet connectivity, modern POS systems are typically cloud-based and rely on an internet connection to function. But do POS systems need internet to work? And how do offline POS systems function?

In this blog, we'll explore the role of the Internet and your POS system.

1. Do POS Systems Require Internet Connectivity?

There are different types of POS systems available in the market, with varying requirements for internet connectivity.

Types of POS Systems and Their Connectivity Requirements:

Cloud-based POS Systems: These systems require a stable internet connection to function optimally. The software and data are stored on remote servers, and the system accesses them over the internet. The internet speed and stability can impact the system's performance, and any disruption in connectivity can hinder transactions and data processing.

Hybrid POS Systems: These systems can operate both online and offline, depending on the availability of internet connectivity. They can store data locally and sync it with cloud-based servers when internet connection resumes. However, their offline mode may have limited functionalities, and the system may require manual syncing and data management. When searching for a hybrid POS system, its important to find one that has a comprehensive offline mode, so that if/when your internet does have a disruption, your store can still not only process sales, but also still have full access to all POS functions. Its important also that the retail system can easily sync back up, when the internet is restored, so it is as if your connectivity was hardly even lost in the first place.

Offline POS Systems: These systems typically do not require internet connectivity, as they store data and software locally. They may require periodic software updates and maintenance, which can be done offline or via physical storage devices.

Advantages and Limitations of Internet-connected and Offline POS Systems:

	Advantages	Limitations
Online POS Systems	Real-time data access, automatic software. Automatic software updates. Ability to accept multiple payment options. Remote access from anywhere. Lower ongoing maintenance. Advanced reporting and analytics. Integration with other software systems.	Dependence on internet connectivity, Subscription-based pricing models. Ongoing maintenance and support requirements. Potential security risks if you don’t choose the right software partner.
Offline POS Systems	No dependence on internet connectivity. One-time pricing models. Lower ongoing maintenance and support requirements.	Limited functionalities. No ability to process payments. Manual data syncing and management. Limited reporting. Limited analytics capabilities. Lack of real-time inventory, customer & sales data. Restricted to the counter; no mobile options.

Internet-connected POS Systems

Advantages	Limitations
Real-time data access, automatic software. Automatic software updates. Ability to accept multiple payment options. Remote access from anywhere. Lower ongoing maintenance. Advanced reporting and analytics. Integration with other software systems.	Dependence on internet connectivity, Subscription-based pricing models. Ongoing maintenance and support requirements. Potential security risks if you don’t choose the right software partner.

Offline POS Systems

Advantages	Limitations
No dependence on internet connectivity. One-time pricing models. Lower ongoing maintenance and support requirements.	Limited functionalities,. No ability to process payments. Manual data syncing and management. Limited reporting. Limited analytics capabilities. Lack of real-time connection of inventory, customer & sales data. Restricted to the counter; no mobile options.

It's worth noting that some modern POS systems, like Celerant's 'Always On' POS, offer a hybrid approach that combines the benefits of both internet-connected and offline systems, while minimizing their respective limitations.

2. Factors to Consider When Choosing Between an Online or Offline POS System:

Business Needs: Consider the nature and size of your business, the volume of transactions, the need for real-time data access, the type of payment processing options required, and the scope of future growth and expansion.
Budget: Evaluate the costs of software, hardware, internet connectivity, maintenance, support, and payment processing fees, and compare them with the potential return on investment.
Security: Consider the potential risks of data breaches, malware attacks, and other security threats, and be sure to choose a retail system with adequate security measures in place for both online and offline modes of operation.
Convenience: Evaluate the ease of use, installation, training, and user interface of the system, and choose a system that better aligns with your business's workflow and culture.
Payment Processing: Consider the payment processing options available with the system, such as the ability to accept various forms of payment, the ease of use of the payment processor, and any associated fees or transaction costs.
Offline Mode: Evaluate the system's offline capabilities, such as the ability to process sales, look up customers, and access pricing and promotions, and the level of functionality provided in offline mode.
Technical Support: Consider the level of technical support and assistance available from the vendor, both during the installation and training phase and in the event of technical issues or downtime.
Integration: Evaluate the system's ability to integrate with other tools or platforms used by your business, such as accounting software, e-commerce platforms, and inventory management systems.

Here’s a quick snapshot of Internet-connected and Offline POS Systems to help you choose the right one for your business:

Features	Online POS	Offline POS
Data Access	Real-time	Limited
Software Updates	Automatic	Manual
Reporting & Analytics	Advanced	Limited
Security	Potential risks based on provider	More control
Costs	Subscription	One-time
Maintenance	Ongoing	Lower
Functionality	Extensive & flexible	Limited
Payment Processing	Supports integrated payments	Can't process integrated payments

Features	Online POS	Offline POS
Payment Processing	Supports integrated payments.	Can't process integrated payments
Reporting & Analytics	Advanced	Limited
Functionality	Extensive & flexible	Limited
Data Access	Real-time	Limited
Maintenance	Ongoing	Lower
Software Updates	Automatic	Manual
Security	Potential risks based on provider	More control
Costs	Subscription	One-time

In terms of payment processing, internet-connected POS systems have the advantage of being able to support multiple, integrated payment options, including mobile payments and digital wallets, while offline POS systems can’t process sales or credit card payments. It's important to consider which payment methods your customers are most likely to use and choose a POS system that supports them.

3. Advantages of Internet Connected POS

If you're considering whether or not to connect your POS system to the internet, here are some advantages you might want to consider:

1.) Real-time data syncing

No more manual data entry and the risk of human error
Sales and inventory data are updated in real-time across all devices and locations

2.) Access to cloud-based features and services

Cloud-based systems offer more flexibility, scalability, and cost-effectiveness than traditional on-premises systems. Just like the two versions of Celerant’s cloud-based retail software that allows you easily upgrade from Cumulus Retail to Stratus Enterprise as your business grows.
Access to valuable features like online ordering, customer loyalty programs, and sales analytics

3.) Improved efficiency and productivity

Automated processes like inventory management, ordering, and invoicing save time and reduce costs.
Employees can access real-time data and take action quickly, improving decision-making and productivity.

4.) Enhanced security and data protection

Cloud-based systems offer better security and data protection than traditional on-premises systems.
Data is encrypted and stored in secure data centers, reducing the risk of data breaches and loss
Data is typically hosted off-site, and a 3^rd party facility, and has daily back-ups

5.) Payment processing

Internet-connected POS systems provide fast and secure payment processing options, including credit and debit card transactions, mobile payments, and other electronic payment methods.
Transactions are processed in real-time, reducing the risk of errors and increasing transaction speed.

With an internet-connected POS system, you'll be able to manage your business from anywhere, access valuable data and insights, and streamline your operations. Plus, with real-time syncing, you won't have to worry about your data being out of date faster than yesterday's news.

4. Limitations of using Offline POS Systems

While for some, there might be some benefits to using an offline POS system, there are also several limitations that businesses should be aware of before making a decision. Some of these limitations include:

Limited functionality: Offline POS systems often have limited functionality, compared to their internet-connected counterparts. For example, they may not be able to access cloud-based features like online ordering, customer loyalty programs, and sales analytics.
Manual synchronization of data: Offline POS systems may require manual syncing of data, which can be time-consuming, increase the risk of human error and most importantly- increase the need for cancelled orders. This means that sales and inventory data may not be updated in real-time across all devices and locations, which can lead to inaccuracies and inconsistencies in reporting as well.
No access to mobile devices: With offline POS systems, businesses are limited to using stationary devices, which may not be as convenient or flexible as mobile devices. This means that businesses may not be able to serve customers as efficiently or effectively in various locations, like off-site events or pop-up shops.
Higher initial installation cost: One of the significant limitations of offline POS systems is their higher initial cost. They require an upfront investment in hardware, software, and other equipment necessary to set up the system, which can be a significant expense for small businesses. In contrast, cloud-based SaaS retail systems have a lower initial cost, with most of the cost being spread out as monthly subscription fees.

It's important for businesses to carefully weigh the advantages and limitations of both offline and internet-connected POS systems before making a decision. While offline systems might have lower ongoing costs and enhanced stability, they may also lack the functionality and real-time data syncing that internet-connected systems provide.

Celerant's 'Always On' POS System

At Celerant, we understand the importance of being able to serve your customers and process sales seamlessly. That's why our 'Always On' POS system allows you to do just that - assist customers and process sales from anywhere in your store, without worrying about internet outages.

With our mobile ePOS system, you can have the peace of mind that even if your internet goes down, your retail operations won't be interrupted. Not only can you still process sales via the Celerant point of sale in offline mode- but your store associates still have complete access to customer and pricing data, as well as inventory- it’s as if your store isn’t down at all. Once connectivity is restored, your store will sync and it’s as if your connectivity was never even disrupted.

Which Type of POS System is Right for Your Business?

When deciding between these two options, there are several factors to consider. For example, if your business relies heavily on internet connectivity, an internet-connected POS system is the better choice. However, if your internet connection is unreliable or if you operate in a remote location where internet access is limited, a hybrid cloud-based POS system may be more appropriate.

When reviewing internet-connected POS systems, it’s most important to learn about the system’s offline mode, for when the internet does lose connectivity. Some of these types of POS systems might not even have an offline mode, others might have an offline mode but it is limited to only processing sales. The safest bet is to find a point of sale that offers the hybrid option with an extensive offline mode, enabling not only sales- but also access to all point of sale functions as well. If you operate a busy retail store or restaurant, an internet-connected POS system with an offline mode, and real-time inventory management and reporting can streamline your operations.

Ultimately, the right POS system for your business will depend on your specific needs and circumstances. By carefully considering factors such as internet connectivity, location, and nature of business, you can make an informed decision and choose a POS system that will help your business run smoothly and efficiently.

If you're interested in exploring your options when it comes to cloud-based POS systems, our team is here to help. We can guide you through the process and help you make the right decision for your business.