Implementing a mobile point of sale (mPOS) system can transform how you accept payments. But with so many options to evaluate, where do you start?
In this comprehensive guide, we’ll cover everything you need to confidently choose an mPOS solution tailored for your retail shop, restaurant or service business.
You’ll learn:
- What is mPOS and how it enables mobility
- The benefits and cost savings of using mPOS
- Latest industry trends and innovations
- Key factors in choosing an mPOS provider
- 6 leading mPOS systems ranked
- Best practices for mPOS data security
- Tips for selecting the right setup for your needs
Let’s dive in!
What is mPOS and How Does It Work?
An mPOS or mobile point of sale system allows businesses to accept payments with a mobile device like a tablet or smartphone instead of a traditional POS terminal.
To accept payments, you simply download an app from an mPOS provider like Square or Shopify POS. You‘ll also receive a credit card reader that plugs into your device‘s headphone jack, charging port or wirelessly connects via Bluetooth.
When a customer is ready to pay, you input their total into the mPOS app on your phone or tablet. They then tap, insert or swipe their card using the reader. Their payment details are communicated securely from the reader into your app. The transaction is then processed by your mPOS provider.
Then just like with a regular POS system, a receipt can instantly be SMSed, printed or emailed to the customer.
But unlike traditional POS systems confined to a cash register and counter, mPOS allows you to accept payments from anywhere in your business. This flexibility enables shorter checkout times and mobility to engage customers on the retail floor or tableside at restaurants.
Key Benefits of mPOS for Small Businesses
Research shows that mPOS adoption saw 26% growth from 2020 to 2021. And 83% of businesses that added mPOS reported increased sales as a result. What’s driving small businesses to embrace mobile point of sale systems?
Benefits like:
- Lower costs – mPOS apps are affordable SaaS solutions costing less than purchasing proprietary POS hardware or terminals. Transaction fees are competitive too at only 2.4% to 3.5% with mainstream providers.
- Enhanced customer experience – Studies show 42% of customers abandon carts and purchases due to long lines. mPOS enables faster purchases and retail associates to engage customers more on the salesfloor.
- Increased sales – In addition to higher checkout capacity during rush periods, mPOS empowers associates to look up inventory availability and even place orders on the spot avoiding missed sales.
- Accessible analytics – Cloud-based reporting in mPOS apps provides real-time insight into your top selling items, busy store hours and employee sales performance.
- Seamless omnichannel – Many mPOS systems integrate natively with ecommerce platforms. This enables a centralized view of in-person and online sales with unified inventory management across channels.
Clearly for most small retailers, restaurants and mobile services, mPOS provides a complete payment processing and POS solution at an accessible price.
Next let‘s compare mPOS capabilities versus traditional POS systems.
mPOS vs Traditional POS Systems
To evaluate whether mPOS is right for your business, it helps to compare capabilities against what a traditional POS system offers:
Traditional POS System
- Expensive starting costs for hardware/software
- Fixed to a counter and cash drawer
- More prone to internet/power outages
- Limited sales data and reporting
mPOS System
- Affordable software and reader hardware
- Complete mobility for checkout anywhere
- Reliable cellular + WiFi connectivity
- Rich real-time reporting and analytics
For most small businesses today, an mPOS system delivers better flexibility, insights and scalability at a lower cost.
However, for large multi-location retailers managing extremely high order volumes, tailored POS hardware and customized software may still be required. The capabilities gap between mPOS and traditional systems has narrowed significantly though even for advanced use cases.
Latest mPOS Industry Trends and Innovations
The mPOS sector continues to expand at a high velocity by delivering new innovations to merchants. For example in 2022:
- Contactless payments increased over 200% as customers shifted to mobile wallets like Apple Pay and tap cards. mPOS providers have responded with mainstream tap payment acceptance and NFC card readers.
- Integrated marketplaces emerged as new sales channels for restaurants via mPOS platform tie-ins with Uber Eats, DoorDash and GrubHub.
- Customer engagement apps now plug into some mPOS systems allowing personalized offers to diners from their tables.
This pace of innovation is projected to continue disrupting merchant payments:
- By 2025, 77% of POS terminal payments are forecasted to be contactless.
- Offline modes will enable mPOS transactions during internet outages via synchronizing data to the cloud when connection restores.
- Beacon connectivity and GPS will empower mPOS for more mobile businesses like food trucks with dynamic real-time menu and location syncing.
As you evaluate options, be sure to look for modern mPOS features that will future-proof flexibility for your business.
6 Top mPOS Systems Ranked
With so many mPOS apps available now, how do you determine the best options tailored for your business?
We ranked the top iPad, Android and smartphone mPOS systems based on:
- Cost
- Features
- Ease of use
- Scalability
- Hardware
- Support
Here is how the leading restaurant, retail and mobile services mPOS solutions compare:
| mPOS Provider | Pricing | Key Features | Rating |
|---|---|---|---|
| Square | 2.6% + $0.10 per in-person transaction Additional 1% for manual card entry |
Customizable workflows Client profiles and purchase history Integrates scheduling, payroll, etc. |
👍👍👍👍 (4.7/5) |
| Clover | 2.4% – 3.4% per transaction $59+/mo software fees |
Detailed reporting Employee tracking <br Tableside ordering |
👍👍👍👍 (4.6/5) |
| Shopify POS | 2.7% per transaction $89 – $299/mo software |
Built-in ecommerce integration Centralized inventory tracking Customer relationship management (CRM) |
👍👍👍 (4.2/5) |
| Lightspeed | 2.6% + $0.10 per transaction $69+/mo software fees |
Custom floor plans Advanced data analytics dashboards Omnichannel integrations |
👍👍👍👍 (4.8/5) |
| Toast | 1.8% – 3.5% per transaction $79+/mo software |
Restaurant-focused features Staff management and scheduling Integrated accounting |
👍👍👍👍 (4.7/5) |
| Lavu | 2.8% – 3.5% per transaction $69+/mo software |
Specialized for full-service restaurants Tableside ordering and payments Custom table layouts |
👍👍👍👍 (4.6/5) |
While Square, Clover and Shopify POS focus more on general retail, Toast and Lavu tailor specifically to full-service restaurant needs with advanced capabilities like managing floor plans and table ordering schemes.
Several of these mPOS systems offer free trials so you can test features firsthand. Reaching out for demos and comparisons is highly recommended before committing.
Best Practices For mPOS Data Security
Of merchants surveyed who avoid mPOS solutions, over 50% cited security concerns as the primary reason not to adopt mobile POS.
However, mPOS systems that adhere to encryption and compliance standards can actually provide superior security over traditional POS systems. Here are best practices to ensure your customer payment data stays protected:
Secure hardware
- Require EMV or smart chip card readers. These dynamically generate unique data per transaction making details harder to steal.
- Verify Point-to-point encryption (P2PE) Compliance which encrypts data from the reader before entering your device and network.
Compliant mPOS software
- Only use apps validated as PCI DSS Level 1 compliant – the payment industry’s security standard.
- Check for TLS 1.2+ compatibility for encrypting transactions sent to networks.
Employee policies
- Never store customer card details like security codes in mPOS apps or other locations.
- Establish unique login credentials per employee for accountability.
- Install remote wipe capabilities to erase data on lost mobile devices.
Additional fraud prevention
- Use address verification checks with an mPOS provider’s risk rating engine to detect suspicious transactions.
- Compare signed receipts against terminal signatures for big orders.
- Frequently update devices and mPOS apps to the latest security patches.
By vetting mPOS hardware security, scrutinizing your provider’s compliance, and educating staff on best practices, you can enable mobile payments while also keeping customer data safe.
Tips for Choosing the Right mPOS
Here are expert recommendations to identify the best mPOS specifically for your business:
1. Set your key criteria
Start by outlining must-have capabilities so you can accurately compare provider options. Keep the list concise focusing on absolute essential features.
Common criteria often include:
- Specific payment types (debit/credit, contactless, Apple Pay etc.)
- Platforms supported (iPhone, Android, iPad)
- Inventory management needs
- Access to reporting and analytics
- Hardware (printer, cash drawer)
- Budget constraints
2. Take stock of long-term needs
Consider how your mPOS requirements might evolve 2-3 years out. You want to avoid outgrowing basics features in 6-12 months.
Think about expansion plans to:
- Add locations
- Launch loyalty programs
- Build an online store
- Manage reservations
Looking ahead will help target providers that scale along with your vision.
3. Compare setup costs
Pricing varies widely for monthly software fees, payment processing rates per transaction, and hardware accessories.
Be sure to accurately cost compare matching bundles of features between vendors. Having usage volume estimates will help build precise budgets.
And don’t overlook optional add-ons like printers and cash drawers in cost analysis – they often get big price tag upcharges.
4. Validate ease of use
Don’t underestimate the importance of an intuitive user interface and setup process. This impacts staff onboarding time plus ongoing usage friction.
Ask about:
- Employee training needed
- Menu/feature customization flexibility
- Steps to integrate other software systems
Testing apps firsthand via free trials is extremely valuable before deciding.
5. Check provider reputations
It pays to examine the vendor reputation through:
- Searching reputable review platforms to verify widespread satisfaction across customers with similar needs.
- Calling support during trials to gauge responsiveness for your questions.
- Exploring their client list for other businesses like yours using their systems.
Vetting vendor credibility upfront gives confidence in their guidance matching the right mPOS solution to your requirements.
Key Takeaways: Find Your mPOS Fit
The options for mPOS systems tailored to small business continue advancing rapidly with ever more choice and features. While the exploding solutions market brings complexity in identifying the best fit, it also enables a setup that aligns exceptionally close to your budget, needs and future ambitions.
As you evaluate providers, consider:
- Prioritizing essential features first before assessing nice-to-haves. Knowing core musts streamlines options.
- Testing usability firsthand before committing to ensure intuitive workflows.
- Understanding all cost considerations for hardware, software and transaction processing fees weighed together. It’s easy to get nickeled and dimed.
- Considering future expansion plans even if not needed near-term to confirm scalability.
Still overwhelmed sifting through the thousands of apps and hardware combos in the market?
At TailoredPay, our dedicated merchant success team provides unbiased guidance on identifying the mPOS systems uniquely suited for your business. Our experts take the time to understand your budget, requirements and growth roadmap before recommending cost-effective solutions tailored to your needs.
Sound helpful sorting through options? Schedule a free consultation to discuss simplifying payments or optimizing your processing.
