POS systems can be quite costly, depending on the features you’re looking for and the brand you decide on. Financing a POS system can be a good way to stretch the cost over months or even years, reducing the financial burden on your business. This can be a great way for startups to get the POS system they need at a price they can handle. One option is moneyexpert.com.
Keep reading to learn more about financing a POS system and whether or not it’s right for you.
What’s Your Monthly Budget?
Before making the decision to finance anything, you’ll want to take a close look at your business’s monthly budget to ensure it’s an option. Financing can end up costing more than the original price of the item, so you’ll want to be sure your business can account for things like interest rates as well.
If you don’t have a monthly budget in place for your business already, you’ll want to get one created as soon as possible. A budget will help you identify your business’s greatest expenses and give you a more in-depth look at what your business can afford in terms of financing.
Using a financial advisor to help you craft the perfect budget will grant you access to expert financial advice when forming a plan. These experts will help you decide how to budget each expense, as well as how to save more money and increase your profit margin.
What Features Are You Looking For?
The next consideration for your decision to finance (or not to finance) a POS system is the features you’re looking for. Do you want a POS system that is feature-rich, complete with inventory tracking tools, customer profile tools, and more? Or does your business require something a little more bare-bones?
Take a look at how you currently track inventory. Are you still using the paper and pen method? Manual counts? These counts are often full of errors, causing you to spend extra time correcting them or perform a recount of the product. Compare POS systems against your needs to get a better idea of which features you can live without and which are a necessity for your business.
Once you’ve identified which features you want with your POS system, you can begin actually shopping for one. If you find multiple POS’s with similar features, don’t just compare their prices; compare their reviews as well.
Customer reviews are some of your greatest assets when deciding to purchase an item, as customers that leave a review will have used the product and have a good understanding of how it should work (and whether or not it actually worked as it’s supposed to).
What’s Your Maximum Price?
Next, you’ll need to figure out what your maximum price is for a POS system. You should have already set up a budget or at least taken a good look at all of your finances to determine what kind of spending money your business has available on a monthly basis. Remember that financing usually includes an interest charge, which will be accounted for in your monthly payments. This number will vary based on your business or personal credit score, and can often be fairly high if you don’t have a credit history or have bad credit.
Shop around for financing options and compare interest rates before you make a decision. Set a maximum price per month you’re willing to pay for your new POS system and compare that to the cost of the brands you’ve chosen from. You may find that you can’t actually afford the system you want yet.
You don’t want to finance something that’s too expensive for your business based on prospective income. Sure, you’re planning for your business to grow in the future, but the unfortunate fact of doing business is that nothing is certain. Only make purchases based on what you can currently afford. You don’t want to default on a financing loan, or else you’ll likely lose the item you financed, and you’ll receive a negative mark on your business’s credit history.
Is Financing An Option for You?
Financing may be a good option for some businesses, but that doesn’t make it right for every business. Maybe you don’t want to pay interest on your purchase, or going into debt for certain tools isn’t exactly part of the business plan. Before you decide to finance, be sure that financing is not only a possible option for you, but that it also fits your business plan and is right for you.
You might find upon applying for financing that you can’t even get a POS system financed due to the business’s (or your personal) credit history. If you can’t get financing, you’ll simply want to save up for the POS system you’re considering, or opt for a system that operates on a per-transaction basis.
Square POS and Vend HQ are both affordable options, and Square only charges a percentage on each transaction plus thirty cents. When you sign up for Square, they’ll even mail you a free magstripe reader for use with your mobile device.
Financing has many stipulations and specific requirements, and may not be right for everyone. Depending on the features you need and the maximum price your business can afford, you may not be able to finance a POS system to begin with. Be sure to perform adequate research on the pricing and features of POS systems, as well as any financing options that are available to you.
More on this topic: Tips For Choosing the Right POS System for Your Restaurant