Retail SMB Forecast: Cloudy and Bright

Cloud Computing MCG

 

When pointofsale.com first approached me to write an article entitled, “Are Cloud-Based Tablet POS Solutions the Future For SMBs?” I responded with an emphatic “Yes!”  It seemed like the kind of post that would write itself, which was great because I had a lot of laundry to fold.  I quickly submitted my first draft, the entirety of which I will share with you now:

Yes.

That’s it.  Short, to the point, totally lacking in any kind of obfuscation or big-city rhetoric.  But, alas, they wanted more.  I needed to “really answer the question, definitively.”  So I went back to my lair and quickly hammered out a second draft:

Yes, Cloud-Based Tablet POS Solutions are definitely the future for SMBs.

This, too, was insufficient.  I suggested that perhaps the problem wasn’t my answer, but with the question itself.  “Perhaps,” I said, “if we asked a more open question, or—better yet—dropped the whole pretense of a question for which we already have a preconceived answer, the article could just be more fleshed out.  This back and forth resulted in the title up above, but also in a feeling of profound annoyance with me harbored by anyone else involved in this post.  But, here’s the thing: I used to be, before I wrote for a living, an IT guy.  I did it for over a decade, and I still am infected with the IT-itis bug, which causes an inflamed sense of ego for having figured out something I expect everyone else ought to know, too.  The disease presents in many ways, but the results are always the same.  Everybody—either openly or secretly—hates the IT guy.  It’s OK, though, the IT guy doesn’t much care for you, either.  I mean, really: how hard is it to turn it off then turn it back on again before you call?  And this is the often the unspoken bonus of cloud solutions.  The IT folks stay on their turf, the non-IT people on theirs—and never the twain shall meet.  It’s kind of ideal.

But, really, here’s the truth of the matter: the cloud isn’t the future for SMBs, it’s right now. As a freelancer, I’m a small business, writing this post on an online word-processing app, and I have clients all over the world who can collaborate with me in real time, making edits to this doc that’s stored in a piece of a globally-accessible drive carved out especially for me, and this whole thing doesn’t cost me a dime.  Back when I was in IT, the cost of setting an  employee up with everything she needed to do her job ran up to $1,500, when you consider the cost of a computer at the time, and software licenses for productivity and specialized applications.  Now, any number of services can set you up with your own domain, email, shared calendars, office apps, video conferencing, long distance calling, and many GB worth of storage for $50 to a $100 per year per user.  The tangible/immediate services that you’re paying for don’t even cover it all, though: small businesses are no longer having to pay for servers and storage to support all their users, don’t have to update or upgrade and any software, no longer have to worry about backing up all the data. And, yes, this means they no longer have to employ an IT person, but let’s not write me angry letters on behalf of the IT people losing their jobs. Small businesses are proving grounds for the young tech professional before she moves on to bigger and better paying positions elsewhere; for the small business owner, the IT “department” is a never ending puzzle to be solved, a necessary evil for operating in a modern world.  kounta may 2015

When you see how the cloud dramatically reduces operating costs, it’s kind of a no-brainer to go that way.  Wherever people can use software as a service they are: accounting, customer relationship management, enterprise resource planning, time and attendance, and, yes, point of sale.   The advent of the digital point of sale a couple decades ago was a tremendous leap forward in the way retail shops and restaurants operated. But it wasn’t all rainbows and processors: hardware fails, software is buggy, and if you own a bar you certainly do NOT want to be dealing with downed servers in the middle of happy hour.  You also do NOT want to deal with the cranky IT consultant whose Friday you just ruined with your emergency messages, but it beats closing down for the night.  And all of this cost money: lots of it,  and recurringly—despite what the phrase “one-time license fee” sounds like.  The prohibitive costs meant the smallest businesses were shut out entirely while the mid-size ones ended up with mid-sized solutions.  Lists were made of “Need to Have” and “Nice to Have” features, and then they’d start crossing items out from the latter till they met their budget.  Now, if the cloud were the future, then this list making tango towards compromise would be the present reality.  Truth is, it’s a thing of the past.

I could tell you all about virtualization for servers and data storage, and get into the nuts and bolts of how this new hardware-doesn’t-matter paradigm lays the foundation for agile disaster recovery, while the communal sharing of a pool of resources keeps costs low for the end user.  Or I could write things that will encourage you to keep reading.  So just just trust me that the forecast for technology climate will be Mostly Cloudy for the foreseeable future.  There’s long been talk of the equalizing power of the internet, but from a commercial prospect that’s only beginning to happen now.  Consider what a small business can get for a $50 a month subscription to a cloud-based Point of Sale:

●    The Point of Sale part, obviously.  Merchants can ring up items and take cash, credit (integrated with the POS), and mobile payments like bosses.  Easy discounts and split payments, automatic tax calculation, fully customizable menus, the whole thing.  Many cloud POS apps work even when your connection goes down.
●    Inventory Management.  If you’ve got to load all your products into the POS so you can ring them up, you might as well add the quantity in, too, right? It’s easy enough for the POS to subtract the number purchased from the stock on hand total. And while you’re there, you might as well ID some stock thresholds so you’re notified when you’re running low.  And since you’re already there, it’s not a huge deal to add in your suppliers’ contact info and PO generating abilities, so you can order and receive new stock right through your system.
●    Customer Relationship Management.  “Relationship Management” is such an awful term; it’s the kind of service I imagine couples therapists offer.  But having some kind of give and take with your customers—especially your loyal ones—is important. By saving their info, like name, address, email, and detailed purchase histories that help you get to know them and their habits. This kind of data collection has long been solely within the purview big chains and franchises.
●    Time Clock Functionality.  Why do they call it a time clock? I get that it’s being used to track your employees time on the job, but it’s a clock.  What else is it going to measure?  It should be called a Time Tracker, or the Shift Enforcer©.  Whatever it’s called, most POS systems have this.
●    Cloud Apps are Accessible.  Cloud is just a trendy buzzword that means “internet,” a fact which helps you remember that your cloud POS app is on the same network as your cloud accounting app, or your cloud loyalty app.  They’re all within reach of each other, operating on the standards built around how websites functional and communicate.  This makes it much easier to start connecting your POS data with other apps and getting the most of out of each sale.
●    Every time you sign up for a cloud app, an angel gets its wings.  Conversely, every time you buy a one-time license fee with an accompanying support contract from a legacy provider, a CEO eats the soul of a newborn baby and can live another 10 years off its youth.  The baby then grows up to be a politician on the take from software lobbyists, perpetuating the cycle of an inequitable playing field for another generation.

So, is the cloud the future? Yes. But it’s the future in the same way that indoor plumbing is the future.  We’re not going to suddenly realize, “You know what? I enjoyed it much more when I had to leave the house in the middle of the night and do my business ankle deep in hookworms and infection.  Get me an outhouse!”
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About the Author

Editorial Team

PointOfSale.com is a leading industry news site for the point of sale and payments industry.We are also the go-to resource for small business owners that want expert tips and inspiration on how to run a successful business. Collectively, our team of experts has decades of POS, payments, and small business experience.