Navigating the changing landscape of the retail POS industry

Lighthouse Beacon

Insights & observations

Mobile POS, M&A activity within the major OEM’s, retailers closing stores, others planning major POS investments within the next 12 to 24 months, omni-channel integration — these are just some of the factors that are impacting the retail POS industry.

We interviewed Mainstreet Inc.’s cross-functional team of POS experts to share their insights to provide retailers with an independent perspective.  Each of us has been actively involved in the POS industry for a minimum of 20 years.

Q:  Oracle announced last week that it will buy Micros Systems.  This is in the wake of NCR’s purchases of Radiant (2011), Retailix including Cornell-Mayo (2012) and Toshiba TEC’s 2012 acquisition of IBM’s Retail Store Systems group.  Why do you think we’re seeing such major M&A activity within a fairly short time?

A:  Likely it’s so the large companies can expand into new verticals/tiers and deliver a stronger, bundled hardware/software/services solution that may provide a single-source for the retailer’s POS needs, greater account control and recurring revenue streams.  With all the refresh activity in process or planned within the next 12 months, the timing could be right.

Q:  Is bigger better?  Are bundled solutions effective for the retailer?

A:  The retailers that we know prefer to retain some independence when selecting software and hardware so they can make the best decision for their business.  It seems we’re almost taking a step backwards to the pre-OPOS days of proprietary systems.  As far as bigger being better, that may resonate for Tier 1 retail like Wal-Mart that needs the depth and breadth of a large global technology provider for their POS needs but we don’t believe it will be effective for retailers from Tiers 2 to 5 who need more flexibility and responsiveness.

Q:  Mobile POS seems to be replacement for traditional fixed POS.  Do you think we’ll see the end of the traditional lanes?

A:  Not for the next several years, if at all.  There will be retailers like apparel who may benefit from a full mobile POS solution but for retail environments with high throughput/large market- basket (i.e. grocery), mobile is not an effective replacement rather it would be best served as line-busting.  What’s more effective for many retailers is mobile POS that converts to a fixed lane.  There are a few options available, for example HP has done a great job of this with their Elitepad MX10 solution.

Q:  There are thousands of stores closing as a result of M&A, rightsizing and bankruptcies.  What about all the POS lanes being displaced?

A:  The used market for POS is saturated for most equipment with the exception of current makes and models.  Even service companies, who typically buy equipment to help them support their customers, have sufficient inventory.  So it’s best for retailers not to count on any significant trade-in value for systems that they want to replace.  But retailers should be able to lower their cost of service as they reduce their install base.  They may also want to ask their service provider for price-relief as their surplus equipment could be channeled into spares to support their stores – that’s what Mainstreet does.  Or we will try to remarket the equipment on our client’s behalf so they get some benefit for their current equipment.

Q:  What would you advise a retailer who thinks they need to replace their POS systems?

A:  First we’d want to understand what’s driving their decision.  If it’s a manufacturer making the equipment end-of-life, that’s not a good reason for the retailer to change their systems when companies like Mainstreet can support it for several years more.

Insights into when to replace, refresh or retain POS systems will be featured in an upcoming blog post.

About Mainstreet Inc:   We are a team of POS industry experts with a proven track record of delivering retailers with best-in-class, multi-vendor POS solutions personalized to their unique environments with consideration to lower total-cost-of ownership.

We’d like to hear from you.  Comments or questions, please email me at

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