Survey Reveals Rapid Adoption of Web-enabled Point-of-Sale Systems
The Internet is proving its value by penetrating yet another aspect of daily life.
In an apparent effort to maximize cost savings, the use of customer data, intra-company connectivity and enhanced customer service, retailers are clearly finding new ways to harness the Internet. According to a survey by LakeWest Group, 55 percent of specialty retailers surveyed are enhancing their store systems strategy and have already implemented or plan to implement a web-enabled Point-of-Sale (POS) system in the next 18 months.
Fully 90 percent of the retailers with less than a year of useful "life" remaining on their POS system indicated that they plan to replace it with a web-enabled system. In addition, the most often cited concern of retailers (38 percent) was a reliable and cost-effective transfer of information between stores and headquarters ("connectivity"). LakeWest Group, the leading retail-focused management consulting firm, surveyed 42 of the top 100 specialty retailers as well as 19 leading POS software vendors.
"Leveraging the Internet is one of the smartest business decisions a retailer can make today," said LakeWest Group Chairman and CEO, Terrence L. Foran. "In addition to the obvious benefits of increased communication with stakeholders, enhancing customer service through web-enabled POS systems can result in significant payback."
POS platforms are taking many shapes: Recent innovations include web-enabled devices like kiosks and web stations, as well as other non-traditional forms such as lanebusters, radio frequency devices and self-checkout lanes. And the presence of these innovations is increasing as 74 percent of vendors already offer such technology in their software packages and 35 percent of retailers surveyed are currently using one or more of these technologies (with 33 percent planning to use "in the future").
Other survey questions addressed the age of current POS systems, timeframe for selecting new systems and satisfaction with current systems. The survey also identified leading providers of hardware, software and operating systems. Some highlights include:
- Age of systems is increasing: Twenty-six percent of retailers’ systems are less than 12 months old and 33 percent are more than seven years old, which are reversed from LakeWest Group’s 1999 survey results of 30 percent (less than 12 months old) and 24 percent (more than seven years). One logical explanation is the activity in 1999 due to Y2K-induced system replacement strategies.
- Major turnover of systems within four years. Sixty-five percent of retailers anticipate they will select and implement a new POS system within the next four years. Furthermore, 92 percent of the respondents with systems over seven years old anticipate that they will replace their systems sometime in the next four years.
- Proprietary systems may be passed over in favor of packaged solutions. Of those respondents with proprietary systems who are looking to replace their current solution, approximately one-third of them are actively looking at packaged solutions in the market instead of trying to design and develop a new solution internally.
The complete survey findings and analysis can be obtained by contacting Sunita Gupta at LakeWest Group, (216) 535-4000 extension 310, or at sgupta@lakewest.com.
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