Basic POS insights that your business needs
Updated: Sep 14, 2020
POS data insights come in many shapes and forms and there is no common definition of what you can and cannot do with your data, but depending on your business model, geography and target customers different types of data insights are relevant. Many of these insights or metrics have been around for many years and are proven to work. Further, having access to POS-based data metrics is something that is useful for a wide variety of reasons whether it be applying for a loan, seeking to increase sales or forecasting growth. In this post we want to go through some of the most common POS data points that companies utilise to draw conclusions about how their business performs and operates. Start with structure A pre-requisite for any meaningful data exercise is to ensure that your product dataset is statistically useful. This means, in the context of POS, ensuring that your product categorisation is accurate and relevant. Not having this in place will make it very difficult to draw any form of general or cross-category insights. Essential sales and inventory metrics One of the oldest ways of using POS data is by measuring sales-to-stock ratios as well as weeks-on-hand metrics both of which provides an overview of the time it takes to sell your inventory, making it a lot easier to measure the performance of different product categories over time. If you haven´t already automated your inventory analysis, this is an excellent place to start. By using these basic metrics as a basis for comparison over time, you can start seeing the impact of different sales and marketing strategies - for instance related to product placement and pricing. If you are keeping an eye on these metrics, you should be able to measure differences on a daily or weekly basis, making trend analysis easy as a breeze. If you are a multi-retailer or sell across multiple channels, such as online and through brick-and-mortar stores, you can also understand and compare which channels to explore further. Understanding how and when customers pay This not only helps you to gain insights into which type of infrastructure is critical for your business, which is a good basis for further investments, but it also allows you to use this information when discussing and exploring new payment options that is constantly being developed by the market. If you have a heavy distribution towards a particular payment option, use this to show what value you can provide to partners that are specializing in such options. Employee data Another great way of using POS data is to verify how well your employees are performing, not only against each other but with different product types. If you have a new product or marketing an existing one in a new way, analyse how top-selling employees are performing with it as they may be the quickest to adapt. Good metrics are sales per employee and how much revenue per hour of work they generate. Customer data Saving the customers´information is interesting as you can establish a direct point of contact, as well as keeping track of your best customers. Implementing a customer relationship management system, usually referred to as a CRM, means that you also need to be a bit more mindful about the data that you capture and ensuring certain rights to your customers, as prescribed under the GDPR, but we believe this is something you should consider going the extra mile for. As an example, if you know that most customers are one-off only, try sending them a voucher for their next visit. With the above basic POS insights you should be able to have more information when deciding on:
Staffing: do you need more or less staff? Does your best performing staff work at the highest traffic days? By combining sales and employee data you can find the right time for the right staff.
Compare stock performance based on location, staff and demography
Check stock-levels faster to see what sells and what doesn´t.
Whether or not to initiate a marketing campaign based on seasonality and target customers.
There are a lot more insights that business can benefit from understanding. Follow one of these links to learn more: How to use POS data to boost sales What is POS data - a checklist for choosing the right provider