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How Much Does a New Retail Software System Cost?
March 14, 2024 / 9 minute read / By Zoya Naeem
Blog
POS System Costs: 2023 Price Guide
Discover all the factors that can affect the POS system cost for your retail business.
For most retail businesses today, the point of sale (POS) system is like the central nervous system of the store, helping with every aspect of business. It helps manage inventory, assist customers, process payments, and keep your business running smoothly.
But when it comes to choosing a retail POS system, there’s no one-size-fits-all solution, and neither is there a one-size-fits-all price tag.
At Celerant, as a leading retail POS software provider for over 2 decades, we get asked every day about the cost of POS systems.
We have gathered information from some of the top POS system providers, to provide you with an upfront and transparent breakdown of the costs of implementing a POS system for your retail business.
The cost of a retail POS system can vary widely depending on the specific features and functionality you need, the size and complexity of your business, and the provider you choose.
In this guide, you will learn:
- Top 3 factors affecting the cost of a POS system
- How SaaS vs. Purchase model can affect the prices of a POS system
- A quick comparison of top retail POS Systems (Pricing, Features, and more)
Top Three Factors Affecting the Cost of a POS System
When it comes to the factors affecting the cost of a POS system, you might want to think of these as the ingredients in a recipe- each one adds its own flavor to the final dish.
Point-of-sale (POS) system costs typically fall into three categories:
But there’s more to consider. Additional features like loyalty programs, advanced reporting, and integrations with other tools can sometimes add to the bill. It’s a bit like adding extra toppings to your pizza – each one comes at a cost.
Understanding these factors ahead of time, helps you properly plan and budget for your POS system transition.
#1: POS System and Retail Software Costs
Think of the software as the operating system of your computer – it’s what makes everything run smoothly, from managing sales and inventory to keeping track of customer data.
The significance of POS software cannot be understated. It’s the brains behind the operation, allowing you to ring up sales, keep track of inventory levels, and even understand your customers’ preferences.
When it comes to pricing, POS software offers two main models: SaaS and purchase.
SaaS is like leasing a car. You do not own the software, but you have a license to use it for as long as you are paying the monthly fee. The retail software vendor is responsible for hosting, technical support, software updates, and other services. This might be a lower investment (especially up-front) and a more flexible option, but you do not have the same control or ownership as you would with purchase.
Purchase model is like buying a car. You own the software outright and can do whatever you want with it, which includes continuing to use it even when you no longer choose to pay for any additional ongoing services. However, you will also be responsible for all the costs associated with owning the software, such as hosting, support, and software updates.
This is a more expensive upfront option, but you have more control and ownership over the software.
POS Software Differences between SaaS and Purchase Model:
| Feature | SAAS | Purchase |
|---|---|---|
| Upfront Cost | Low | High |
| Monthly Cost | Varies | One-time payment |
| Additional Services | Hosting, support, and software updates are all included | Technical support, hosting, software updates, etc. are add-on services, either monthly or annually |
| Ownership | You do not own the software | You do own the software |
| Flexibility | More flexible as you can more easily switch between different providers or scale plans | Less flexible, as you own the software for the long-term |
Understanding these different pricing models is crucial because they can significantly impact your overall POS software cost. Depending on the software you choose, some offer only SaaS options, and some will offer the flexibility of both options, allowing you to choose what makes the most sense for your business.
Additional Factors Contributing to your Overall POS Software Costs:
Apart from the initial POS software expenses, additional options provided by the chosen vendor may influence the overall software cost.
#2: Retail Hardware Costs
A Point of Sale (POS) system relies on essential hardware components to operate effectively. When it comes to determining the cost of POS hardware there are a number of components involved.
Pro Tip:
Depending on the POS software you choose, you might have less expensive hardware options available. If you already have POS hardware, your new POS software might function just fine on your existing hardware. Or, if your new POS software is mobile-friendly, you can choose to purchase tablets and mobile peripherals, which tend to be much less expensive than traditional workstations!
#3: Credit Card Payment Processing Fees
Credit card processing fees are an unavoidable part of running a retail business that accepts credit cards or other forms of electronic payments. These fees can vary depending on the processor, payment type, the merchant’s location, and the volume of transactions.
Payment processing fees can be categorized into three main types:
It’s essential to consider these fees when budgeting for your POS system. While integrated payment processing offers convenience, it’s wise to understand how the fees associated with it may affect your business’s financial health.
Top Retail POS System Price Comparison
Pricing can vary greatly between retail systems, for all of the reasons we discussed above. There are simple systems available in which you can get started quickly and at a low cost, and then there are much more advanced systems out there that can take more time and come with a higher investment.
| POS Software | POS Pricing Model | POS Hardware Compatibility | POS Prices Starting From | POS Add-ons Available |
|---|---|---|---|---|
| Cumulus Retail | Monthly subscription (purchase model available) | Cloud-based, compatible with iOS, Android, and Windows devices | $125/month | eCommerce and mobile shopping apps developed in-house, internal email marketing platform, in-house website SEO services, custom report designer |
| Lightspeed POS | Monthly Subscription | Cloud-based, compatible with iOS, Android, and Windows devices | $149/month | eCommerce, mobile shopping apps via 3rd party developers, customer loyalty and accounting apps available as add-ons |
| Shopify POS | Monthly subscription | Cloud-based, compatible with iOS, Android, and Windows devices | $89/month | eCommerce and mobile shopping apps available via 3rd party partners and developers |
| Heartland Retail | Monthly subscription | Hardware agnostic | $89/month | Integrates to specific 3rd party eCommerce and app options |
| Clover POS | Monthly subscription | Hardware agnostic | $799+$14.99/month (offers limited capabilities) | CRM, Loyalty & Rewards, Payroll, and more available via 3rd party apps |
Remember, everything here is just a general estimate, for each vendor the prices can go up from here as most have different levels and features available. You can get a more precise quote by communicating directly with the POS software provider, who’ll know the type of POS package you will need to get your retail system up and running.
Pro Tip: Start small and add on as you grow
Many retailers start with just the POS software and add on features and integrations later. ITs important to find a scalable software provider who can help facilitate your growth, and support that growth with additional features and/or sales channels, as you need it.
At Celerant, we offer two different all-in-one retail systems; one at a lower price point and one with more advanced features, designed for higher sales volume, which comes at a higher investment. Cumulus Retail by Celerant is a SaaS Retail POS System that is available in scalable versions to support you now, and as you grow your retail business, in-store and online.
Stratus Enterprise by Celerant is a more comprehensive system designed for advanced retailers or those with a need to customize the software to meet the needs of their business.
Think Long-term When Choosing a POS System for Your Business
With so many options on the market today, choosing the right POS system that aligns with your budget and business needs can be overwhelming.
It’s important to ask the right questions at the start. Determine which features are available or not, and which might come standard with the POS system vs those that might need to be added on at an additional cost.
Besides the upfront and ongoing software costs, the hardware, and payment processing fees can also affect the overall cost of your POS system.
Most importantly, ensure that the POS system you choose:
After all, changing POS systems is big undertaking and not something you are going to want to do again in the next couple of years! Plan to partner with your new retail software partner long-term, to help you get that ROI and continue to not only run your business more efficiently, but help you increase your overall sales.
After determining your POS system budget, the next most important aspect is planning for your POS onboarding process. You will want to prepare and have the right expectations for you and your team to ensure a smooth POS transition. Click below to learn about how you can ensure a successful POS go-live process.
Related: 6 Steps to Going Live with a New POS
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