Do you own a full-service restaurant or just a startup quick-service eatery? Well, then you need to know this; you definitely need the right point of sale (POS) system to streamline your operation. Most of the best restaurant POS systems available will help you run things more smoothly and efficiently in your business.
For instance, it will help your staff take orders, link front of house to back of house, keep track of the inventory and employee hours, manage tables and help you assign tasks to your employees as well as process payments. Additionally, some of POS technology in use today will give you real-time reports and analysis on your business.
While this technology will improve customer satisfaction, efficiency and profitability of your business, it does not come for free. So, how much does a restaurant POS system cost?
As you may have realized, the cost of restaurant POS systems varies from one provider to another. Again, you may have noticed that some of the leading POS providers offer different price plans for their products and services.
This is because the cost of a point of sale system depends on several aspects. As such, the much you will end up spending on your system will mainly depend on what you need in your business.
To clarify things even further, here are the main aspects that will affect the cost of your restaurant POS system:
1. Restaurant POS Software Cost
How much does your preferred provider charge for the POS software? Again, this depends on several things. In most cases, the cost of your restaurant POS software will depend on the size of your business, number of locations and number of features and capabilities offered by the software.
Again, the software cost will also depend on the type of software you will be using. In this regard, these are the two main POS software types you should consider:
Legacy Restaurant POS Software
Though not so popular, legacy restaurant POS systems are still in use in some establishments. If this is your preferred setup, you will need legacy POS software. In such a case, the software is installed onto an internal back office server. It is this server that will be hosting a network of computers, which serve as the customer-facing interface.
The much you pay for this software will mainly depend on the POS needs in your business. However, you should expect to pay between $600 and $1000 per user for legacy POS software. Assuming that you have two stations for your servers and one behind, you will have to pay about $2,400 for the software—at the rate of $800 per user.
Cloud-based Restaurant POS
Legacy on-site POS systems are known to be expensive to purchase, install and maintain. This is probably why they are being phased out by cloud-based POS systems. As opposed to legacy POS systems, cloud-based systems are cheaper, lightweight and offer more features.
Most of the leading cloud-based software products in the market today are offered as Software-as-a-Service (SaaS). This has allowed providers to lower startup costs business owners have to incur while implementing a point of sale system, without affecting the functionality of the software.
In most cases, point of sale providers hosts the solution entirely on the cloud. As such, business data collected by the POS system will be securely stored in the cloud. Business owners are then allowed to access the data conveniently and quickly through a native POS app or a web-based system.
Cloud-Based POS Pricing
Regardless of your preferred provider, you will be required to pay for the cloud-based restaurant software upfront, per transaction or based on a subscription plan. So, how do these three methods of payment work?
- Upfront Payments
Some restaurant POS providers do not require you to pay for monthly subscriptions. Instead, they only ask for a one-time licensing fee for a lifetime use of their POS software. The problem with such systems is that they are known to offer a limited number of features.
Then there are those providers that require you to pay for a year or two upfront. In such a case, the cost will be calculated on a per month rate. However, some companies will give you discounts. This way, you will end up paying less for an annual subscription, than you would pay month to month.
On average, you should expect to pay about $900 per annum per POS terminal. For the providers that require a one-time upfront payment, you should expect to pay a higher amount.
- Subscription Payments
Rather than having your pay a large one-time upfront cost, there are those POS providers that will require you to subscribe to a monthly plan. As a matter of fact, most of the leading restaurant POS providers in the market fall under this category.
Most of such providers offer you several subscription plans to choose from, depending on your POS needs. In this regard, you will be required to pay for your preferred subscription plan month after month. In most cases, the cost of POS subscription plans depends on the features they offer.
On average, you should expect to pay between $40 and just above $100 per month for each of the POS stations you have in your business. This amount will be billed either monthly or annually. As a rule of thumb, you should ensure that your preferred subscription plan offers the restaurant POS features you need in the business.
For instance, your restaurant POS software should offer such capabilities as:
- Table Management
- Inventory Management
- Employee Management
- Sales Reports
- Customized Ordering
- Online Ordering Integration
- Email and Phone Customer Support
- Offline capabilities
- Loyalty Programs
- Automated Ordering
- Kiosk Functionality
2. Restaurant POS Hardware Cost
While POS software is an integral component of a restaurant POS system, it will be of not use without the right hardware components. As you may be aware, modern POS systems are meant to help you with a lot more than just register and payment processing.
However, you will need to connect the right hardware components to the POS system in order to tap into these capabilities. To begin with, you must know that different POS systems have different hardware requirements. In this regard, some systems can only work with the hardware provided by the provider.
However, there are those restaurant POS systems that allow you to use third-party hardware with your system. Regardless of the case, you must ensure that you get hardware components that are compatible with your POS. First and foremost, the cost of your POS will depend on the type of system you choose, as illustrated below:
Legacy Restaurant POS Hardware
As you have seen above, the cost of legacy POS systems can be very high. This is also the case for legacy POS hardware. Much of the cost you pay for such a system will be for the in-house server, which is a requirement. On average the hardware for a legacy POS system costs between $5,000 and $7,000.
Again, the installation of these systems is relatively complex. As such, you will need a professional to install it in your premises. Well, the installation of a legacy POS system is expensive and will set you hundreds of dollars back.
Another downside to these systems is that they require regular updates and servicing—which also comes at a cost. This is why a considerable number of business owners are upgrading to cloud-based restaurant point of sale systems.
Cloud-based Restaurant POS Hardware
As compared to legacy POS systems, cloud-based systems are lightweight and are associated with significantly lower hardware costs. For the register, most of the best restaurant POS systems today only require a slim touch-screen device, such as an iPad or Android tablet.
The fact that cloud-based POS systems as sold in Software as a Service (SaaS) model mean that you do not need to invest in costly POS hardware components. Another great thing about such systems is that their hardware components are often sold in the form of bundles by the various vendors.
You will find POS hardware bundles to be cheaper than having to buy the various components separately. Again, these components are bundled in accordance to your business needs. If you are looking forward to sourcing your own hardware, hence save on the purchase, you should avoid proprietary restaurant POS systems.
So, POS hardware components will you need for a cloud-based restaurant POS system and how much do they cost?
- Restaurant Display Terminal
For some of the leading point of sale systems available today, all you need is a compatible tablet to have a functional POS system in your restaurant. However, you may still need a stationary POS terminal, if not two, in the business.
For the stationery POS terminal, it is advisable to go for hardware that features an intuitive touch screen interface. In this regard, you should invest in general purpose POS terminal hardware, which costs about $400. It will be cheaper to buy the hardware as a bundle that it would be to acquire each component separately.
Some restaurant POS providers are known to offer all-in-one POS terminal devices. Such devices are often stationery and feature touch-screen interface. You staff will be using this device to ring up sales. For such hardware, you should expect to pay between $900 and $2000 for per unit.
- Mobile/Tablet Terminals
In order to turn tables faster and boost efficiency, an increasing number of restaurants are now implementing mobile POS solutions. In this case, you will need a hand-held device that is compatible with your preferred restaurant POS app, such as an iPad or a tablet.
For proprietary POS systems, you will have to get the device from the provider. In such a case, you should expect to pay about $350 for an iPad or about $200 for a Windows or Android tablet. However, there are those systems that allow you to use the tablet or iPad you already own. This can result in a significant saving.
Most of the leading POS systems in the market allow you to either print the receipts or send digital receipts to your customers via text or email. If you would like to print customized receipts for your customers on-site, you should invest in the right receipt printer for each of the POS terminals in the restaurant.
Some of the basic receipt printers that may be used for a restaurant POS system cost about $250. Depending on the cloud-based POS you are using, you may also need a kitchen printer. Once a server has ringed up an order, the information will be routed to this kitchen printer for preparation.
As compared to receipt printers, impact kitchen printers are costlier. In this regard, you should expect to spend about $350 on an impact kitchen printer.
- Cash Drawer
As far as the register is concerned, a cash register is an important component for your point of sale system. Although a large number of consumers today use cards to pay for their orders, you will also be processing cash payments in the business.
When coupled with the right restaurant POS software, your cash drawer will monitor cash levels as well. As such, it will be easier for to keep track your takings for each day. When bought separately, a multi-compartment cash drawer will cost between $60 and $150.
- Credit Card Reader(s)
This is an important hardware component for your restaurant POS, if at all you expect to process card payments. As you may have noticed, most restaurant customers prefer using their cards to pay for their orders to cash payments.
This being the case, it makes sense to give to give your customers an option to pay using their cards. If you are looking for affordable hardware, a magstripe-only card reader will suffice. Such a reader will cost about $100. For the more advanced EMV, magstripe reader and pinpad, you will end up spending about $300 on the hardware.
- Tablet Stands and Enclosures
Some of the cloud-based restaurant POS systems available today run exclusively on iPads. In order to set up a stationery POS terminal with such a system, you will need a tablet stand and or enclosure for each of the stations in the restaurant.
The basic and simplest of tablet enclosures in the market cost about $100. However, the more stylish and sophisticated stands and enclosures will set you back by about $200.
- Bar Code Scanner
If you intend to use bar codes on your products, you will need a POS bar code scanner in your business. If you are looking for an affordable option, you can settle for a basic reader—priced at about $100. The more sophisticated 2D scanners that can read QR codes as well, you should expect to spend more than $200.
Regardless of the hardware components you need in your restaurant, you may be better off buying them through a lease contract. Rather than requiring an upfront payment for hardware, some providers will allow you to sign a purchase contract, hence pay using monthly installments.
3. Card Processing Fees
However small or large your restaurant is, you need to be able to accept credit and debit card payments from your customers. In addition to having the right POS credit card reader hardware, you will also need to sign up with your preferred card processor. This is the only way you will be able to process card payments in your business.
For POS providers that do not offer card processing, you will have the liberty to choose from several merchants. Regardless of the case, you will be charged processing fees for each card payment you process. If your POS provider is also your merchant account provider, the credit card processing rate will be commensurate with the subscription plan you choose.
In most cases, POS providers that double as merchant account provider charge a card processing fee of between 2.2 and 4.5 percent for each transaction. The card processing fee you will be subjected to will also depend on your transaction volume.
Finally, you also need to check whether customer support is offered for free or as part of the subscription cost. If not, you may be required to pay an extra charge to get support services whenever you need them. If you will be using third-party service integrations with your POS system, you also need to factor their cost into the equation.
All in all, the much you end up paying for your restaurant POS system will depend on your business needs and on what your provider is offering. With this guide, it will be much easier for you to estimate the cost of a restaurant POS system.