What is a point of sale?
"Point of sale" is one of those terms that can mean several different things depending on who's using it. At its most literal, the point of sale is simply the place and moment where a transaction happens — where a customer pays and a sale is recorded. For business owners the term usually refers to the system that makes that transaction possible: the software, the hardware, or some combination of both.
For the purposes of this article, when we say "point of sale" or "POS," we mean the system — the software and/or hardware a store uses to ring up sales and record what was sold.
What does a POS system do?
Core capabilities
Ringing up items
The POS identifies what's being sold, usually by scanning a barcode or entering an item manually, and calculates the total. In most systems this also means applying any active discounts or promotions automatically.
Accepting payment
A POS system handles the full range of payment types — cash, credit and debit cards, gift cards, and increasingly mobile payments like Apple Pay and Google Pay. Payment card processing itself typically runs through a connected [credit card reader], but the POS orchestrates the transaction.
Issuing receipts
Whether printed or emailed, the POS generates a record of the transaction for the customer.
Recording the sale
Every transaction is logged — what sold, for how much, when, and by whom. This is the foundation for everything else a POS system can do.
Related POS capabilities
Modern POS systems frequently extend beyond the moment of sale. Depending on the system, you may also get:
Sales reporting and analytics
Because every transaction is recorded, a POS system can surface patterns over time — what's selling, what isn't, your busiest hours, your average transaction size. Some systems keep this simple; others give you a full dashboard.
Inventory tracking
Many POS systems update inventory counts automatically as items sell. This is more useful in traditional retail (where you're restocking the same SKUs) than in resale (where most items are one-of-a-kind), but it's a common feature worth knowing about.
Customer records
Some POS systems build a customer profile with each transaction — purchase history, contact information, store credit balances. This varies a lot by system.
Employee management
Staff logins, permissions, and sometimes time tracking are bundled into many POS systems, particularly all-in-one platforms.
Integrations
Most modern POS systems can connect to external tools — accounting software, e-commerce platforms, email marketing tools — so transaction data doesn't live in a silo.
It's worth noting that not every capability listed here lives inside every POS system, and not every capability a store needs lives inside its POS. For a look at what you should look for in a POS specifically for resale, see Resale POS.
FAQs
Is a POS just a cash register?
A cash register records sales and holds cash. A POS does much more, including tracking inventory, processing card payments, generating reports, and often integrating with other business systems. Most independent retailers today use a POS rather than a standalone register.
Do I need special hardware for a POS?
Not necessarily. Many modern POS systems can run on an existing tablet or computer, with an add-on card reader for payment processing. You may need to add a barcode scanner, receipt printer, and cash drawer.
What's the difference between a POS and consignment software?
A POS handles the transaction layer by processing sales, taking payments, and issuing receipts. Consignment software manages the broader operation: consignor accounts, inventory intake, split calculations, and payouts. Some consignment software includes a built-in POS; others integrate with a separate one.
Can I use any POS for a resale store?
A general retail POS can handle basic sales, but it won't track consignor splits, manage intake, or calculate payouts automatically. For stores running a consignment model, a POS built for resale, or full consignment software, is often the best route. See resale POS.