Advantages and Disadvantages of The New Pos System

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About this sample

About this sample


Words: 2226 |

Pages: 5|

12 min read

Published: Jan 8, 2020

Words: 2226|Pages: 5|12 min read

Published: Jan 8, 2020

Table of contents

  1. Advantages
  2. Disadvantages
  3. Address the following points:
  4. Security
  5. Default Manufacturer Passwords
  6. Fraudulent Devices
  7. Malware via Phishing
  8. Privacy
  9. Measures
  10. Confidentiality

1) What are the advantages and disadvantages of the new POS system?

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POS solutions are often customizable to suit your business needs

Software is hosted on secure servers and in multiple data centers, so your information will always be backed up· It improves efficiency. For instance, user would not have to spend as much time memorizing product prices, or else manually inputting vast amounts of data as they would on a traditional cash register.

It offers efficient stock management, eliminates guesswork on how much to order.

It helps in employee tracking. Through the use of unique identification codes (sometimes referred to as clerk codes), individual employees can be linked to specific transactions, regardless of how many members of staff use the same machine.

It gives retailers back precious time and money. Cutting down on admin time and user error are huge advantages of using a modern POS.

Scanning of the items in the cart and punching of the number from a sticker is done in an accurate manner.

Most modern POS systems also offer merchants access to a variety of customizable reports. These reports can include critical information such as daily takings and outgoings, providing merchants with an understanding of the overall success of their business.

Simplifies the accounting process

Gives you easy access to the past transactions for better decision making

Faster than the old cash register system. Whereas inputting an item’s data using the traditional cash register system can take an estimated 6 seconds, scanning an item using a Point of Sale system’s bar code reader takes a far shorter time - only 0. 3 of a second.

Helps customers get more briefed item receipts


POS system is costlier than the old cash register

Reliable Internet connection and ISP are required to maintain a POS system

It has the risk of getting infected with POS Malware

It Could be problematic with a slow Internet connection

Web-based POS Systems often come with monthly fees

There is also a lot of concerns with regards to online payments that exposes the details of the credit and debit cards of customers and puts their financial security at risk.

2) How will this POS system help the business gain competitive advantages?

Customers of subscription of POS solutions generally have access to unlimited support daily. Customers can also take advantage of on-site training and consultation.

A lengthy line at the checkout ends a customer’s shopping experience on a bad note. Cloud-based POS systems can even eliminate lines entirely and allow your sales associates to complete transactions on the sales floor with dedicated POS devices.

If you don’t have enough employees on hand to answer queries, customers are likely to see if your competitors offer better service. Hourly sales reporting stats from your point of sale system can give you insight into when you need more people on the floor.

If sales associates are slow with Internet marketing methods in staying in touch with customers, you’re giving ones competitors a chance to capture customers’ attention and steal them. Today, point of sale systems can help to market across a number of channels quickly, so staying fresh in customers’ minds isn’t that difficult.

If you don’t have any product in stock, your customer will go somewhere else to buy it. Point of sale software with inventory functionality can help you avoid selling out of your most popular merchandise and allow your associates to save sales by quickly determining what items are in your storeroom waiting to be stocked.

Customers love earning discounts when they shop. Stores have loyalty programs because they really do work and offer a competitive advantage. POS systems make it easy to implement and manage one, so that you can stay at pace with competitors.

Despite businesses accepting credit and debit cards, they may be losing customers. People who use contactless payment systems will often choose businesses that allow them to pay the way they wish. Using a point of sale system that is set up for the newest payment methods can help you avoid losing these tech-savvy customers.

3) What are the advantages of having a centralized database?

It improves Data preservation. Centralized database generally comes up with Fault tolerant feature (the capacity to continue functioning after hardware failure). This feature of Centralized storage includes redundant storage that eliminates the risk of permanent data loss.

The data that is locally stored faces an ongoing physical security threat. Laptops or mobiles can be easily stolen and provide opportunity to access, steal and tamper the locally stored data. Centralized database storage and proper server room security prevents direct physical access to a single location.

Improves Data Security. As businesses now maintain huge set of consumer sensitive information, data protection is a critical issue. Providing data security with a database that is centrally stored creates fewer challenges than data that is stored across multiples sites.

It reduces costs. Centralized storage requires heavy investment in the server technology, such as fault tolerance, but also allows it to reduce overall costs. The maintenance to the central server proves less costly than data maintained across multiple computers, especially if the business operates in multiple locations.

4) How could this POS system facilitate decision making?

Address the following points:

Why do point-of-sale systems process business activities more effectively?

It eliminates the need to memorize product prices and manually entering vast amount of data as is done in a traditional cash register system.

It is very difficult to go back in finding and rectifying a mistake in traditional system, while in Point of Sale system errors can easily be rectified in just a few quick clicks.

While entering the data manually an individual can cause a mistake with every 300 characters typed, Point of Sale system errors are few, with only one substitution error for every 15,000 to 36 trillion barcode characters scanned.

Inputting an item’s data using the traditional system can take about 6 seconds, scanning an item using a Point of Sale system’s bar code reader takes only 0. 3 of a second.

Can the information be tracked manually in an effective manner? Why or why not? It is very difficult to track information manually in an effective manner as it takes a lot of time in going back and checking for the information when it is maintained in cash register system. For instance, if you have storage facilities or multiple branches then a POS system will inform you if you have enough stocks in your store or other branches, and if more stocks are needed. On the other hand, it will be very difficult to track stock kept at multiple locations.

What types of questions could be answered effectively?

Customer’s full purchase history

Best selling products or products generating least revenue· ROI and profit margin and other covenants relating to revenue nd profitability

Who are the salespeople generating more revenue than the other

Real time inventory data· Time at which majority sales coming? (weekday or weekend)

Are sales scattered or do they come at a specific point of time in a day?

Can the necessary reports be automatically generated at the end of week/month?

How could the information be used to better manage the business?

POS systems provide customers with detailed receipts rather than just a piece of paper with the name and amount of product. POS systems use inventory data to provide more information such as item description, price, and savings from a sale or coupon.

POS system allows monitoring Key Performance Indicators (KPIs) such as average customer sales, stock turnover, and profit margin. Such information helps to focus on those products which are generating major revenue by ensuring that they are adequately available all the time.

Also, a company can know its lowest selling products. Thereby, spending minimum on their promotion and keeping in stock.

POS systems provide with access control measures to make sure employee identity is verified for clock-ins and access to your system.

Modern POS systems enable all stock to be scanned properly at delivery and entered into a digital database. Merchants can then review their overall stock levels and accordingly make accurate purchasing decisions.

5) Recommend telecommunication options for this POS system. Address the following points:

Types of networks – LAN, WAN or MAN? As the business is small, LAN will be suitable here. The LAN is an interconnection of small devices covering shorter distances or area. It is used in home offices or schools to share common resources such as printers, internet, memory etc. LAN offers coverage upto 2 miles. Also, it doesn’t cost much.

Types of media? - Wired or wireless technologies? Which types of cables should be used for wired technologies? Which types of wireless technologies? Most modern day business rely on Wireless LAN or WLAN. WLANs use radio frequencies (RF) instead of cables at the Physical layer and MAC sub-layer of the Data Link layer. RF does not have boundaries, such as the limits of a wire in a sheath. The lack of such a boundary allows data frames traveling over the RF media to be available to anyone that can receive the RF signal. WLANs connect clients to the network through a wireless access point (AP) instead of an Ethernet switch. Wireless network interface cards (NICs) tend to reduce the battery life of a mobile device. 6) What type of risks does the POS system bring and how to protect the business against the risks?

Address the following points:


Business Networks With Unsegmented POS Data - If a business is using your corporate network to send system and security updates to POS data environments and devices, then it is at serious risk. In this scenario, if a hacker gains access to your network, he or she has also gained access to all of your POS data. Smaller organizations often go for enabling multifactor authentication (MFA) from the business network to the POS device. This isn't the best solution but it's the most secure option available for modest companies.

Default Manufacturer Passwords

Even if you can memorize the passwords provided by your POS device manufacturer, it's incredibly important that you change the password once you've hooked the device up to your software. That's because hackers have been known to pull lists of these passwords from the manufacturers' networks and trace them back to your devices.

Fraudulent Devices

Make sure you partner with a company with a solid reputation. Otherwise, you may end up buying a fraudulent POS system. By directly gaining access to your customer's credit card, these crooks can pull data without you or your customer knowing anything went wrong. These machines simply tell the customer that the transaction can't be finalized, leaving the customer to believe there is a problem with his or her credit card or that there's a problem with your back-end system.

Malware via Phishing

It's important that you alert your employees not to open suspicious emails. Hackers embed links in email that, if clicked, give them access to your employee's computer. Once the hacker has taken control of the machine, he or she can navigate throughout the network and your servers to gain access to any data.


Work history - Most employers keep digital records of our work histories. Any relevant activity, such as taking sick days and vacation time or productivity reviews, can be accessed by court order or ambitious hackers.

Credit history/purchase history - Today cashless transactions are recorded every time your card is swiped. Most of our financial lives are collected by store systems, credit card issuers, credit reporting bureaus and other entities. Detailed account records can be accessed, which provides not only an opportunity for identity theft but also contributes to your profile.

Mobile device activity - Equipped with global positioning systems (GPS), cell phones can be instantly discovered and located at any time. Phone calls, text messages and web browsing can all be captured by prying eyes. With the rise in demand for mobile apps, hacking has become an easy practice for many privacy intruders.


Encrypt all POS data upon entry and decrypt it only when it reaches the payment processor.

Implement application whitelisting, which allows only necessary applications to run on a POS system. Any apps that might normally add risk, like web browsers or email, are blocked, thus preventing malware infections through these channels.

Keep POS software up-to-date by installing software updates, which often contain important security patches implemented as a result of newly discovered vulnerabilities. Patch management is critical for a secure system.


Disgruntled Employees - Internal attacks facing the data and systems are the most common and the biggest threats big companies face. Terminated employees especially from the IT departments who have knowledge access to admin accounts, access to networks, and access to data centers may cause a serious damage to the company. To mitigate this problem, all terminated employees should have their access revoked. It is also important to control, monitor and manage all privileged credentials to prevent potential acts of exploitation.

Mobile devices - Sensitive data can be highly vulnerable when employees can access company data, share data, or neglect to change passwords using mobile phones.

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Third-party service providers - According to Matt Dicks, the CEO of Bongar, many companies rely on the outsourcers and third-party vendors for maintenance and support of their systems such as Point-of-sale (POS) systems. If these companies use remote access to view sensitive information without following procedures, and the password happens to get into the wrong hands, sensitive information may be lost or accessed by competitors or worse. To control this problem, a company has to ensure that outsourcers follow remote access best practices such as setting privilege permissions, unique credentials and multi-factor authentication. It is also important to delete third-party accounts as soon as the contract of service is over.

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Cite this Essay

Advantages and Disadvantages of the New Pos System. (2020, January 03). GradesFixer. Retrieved July 22, 2024, from
“Advantages and Disadvantages of the New Pos System.” GradesFixer, 03 Jan. 2020,
Advantages and Disadvantages of the New Pos System. [online]. Available at: <> [Accessed 22 Jul. 2024].
Advantages and Disadvantages of the New Pos System [Internet]. GradesFixer. 2020 Jan 03 [cited 2024 Jul 22]. Available from:
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