The point of sale (POS) system is the single most important piece of hardware in a business. It’s where sales happen, and without sales you don’t have a business. However, the POS also represents a security risk to many businesses. Some even call it the “point of theft,” as it can be the place where most theft occurs. That’s why you need to take POS security seriously.
POS security can mean two things: preventing all of the cyberthreats to your POS and integrating your POS system with your security infrastructure to find and prevent theft. In this article, we go through everything you need to know to secure your POS and use your POS to secure your business.
See how Solink improves your POS security and monitoring for better loss prevention results.
What is a POS system?
A POS system is the modern cash register. It facilitates sales in physical stores as well as online. A POS can have many additional features, including calculating sales tax and discounts automatically, managing staff schedules, store sales data, and keeping track of inventory.
What are the components of a POS system?
A physical POS system is a combination of hardware and software. The hardware usually includes a touchscreen (often an iPad), a receipt printer, a car reader, a barcode scanner if necessary, and a cash drawer (or smart safe), if cash is accepted.
The software includes the base system offered by the POS, which usually has some transaction, tracking, and reporting capabilities. However, almost all modern POS systems have software designed to be integrated with other systems, software, and even hardware.
For example, Solink can connect over one hundred different POS systems to security cameras and the Solink platform, which can provide more insights into transaction data, prevent POS employee theft, and generate more metrics.
What are the advantages of a POS system?
POS systems have many advantages over traditional cash registers.
- POS systems are more efficient since the employee doesn’t need to read and type in prices manually, which improves speed of service.
- The POS can help with other business processes, such as training, scheduling, and security.
- They are more secure by linking inventory, employee number, and transaction data.
- They generate a wealth of data that can help in business decisions.
- They can be integrated with other systems and software.
Types of POS systems
These are the most common types of POS systems:
- Terminal POS systems: These POS systems have complete hardware and software provided and as such tend to be more expensive upfront and with high monthly fees. They are popular with larger retailers, grocery stores, and other bigger companies.
- Tablet POS systems: Using a tablet as the main interface for a POS is very popular. They tend to have sleek UI/UX, which makes them easy to use with little training. These systems are particularly popular with restaurants, cafes, quick-service restaurants (QSRs), and smaller retailers.
- Self-service kiosk POS systems: Many businesses during the COVID-19 pandemic attempted to go as contactless as possible. Self-service kiosks were one such effort, and now we see them in many more places. Many QSRs, movie theaters, supermarkets, parking lots, and transportation services have opted for self-service POS systems.
- Mobile POS systems: These turn your smartphone into a POS. You can buy added hardware, such as card readers, to use with the app. Some companies will even give you the app and card readers for free so you only pay for the payment processing. Mobile POS systems are mostly used by temporary and portable shops at farmers markets, events, etc.
- Online POS system: These systems operate similarly to the other types of POS but are completely online. They are used for ecommerce stores. Some of the major online POS systems like Shopify offer hybrid POS systems that allow companies to use the same backend for their online and in-person sales (usually with a table POS system).
Whichever POS system your business uses, the security best practices usually include transaction text overlay. Previously, that was done with a text inserter box.
What is a text inserter box?
A CCTV camera text inserter box is an obsolete technology that connects your network video recorder (NVR) to security cameras. Text inserter boxes permanently imprint transaction records onto video surveillance footage of the transaction.
Text inserter boxes are considered obsolete both because they are no longer necessary for text overlay and because there are better ways to connect video surveillance with POS transaction data that do not permanently imprint the receipt on the video footage.
Let’s take a closer look at text overlay, and then we’ll go through why text inserter boxes are no longer necessary.
What is text overlay?
Text overlay is adding text on top of video. The most common example is closed captions on TV and movies. In the case of POS systems, text overlays are the superimposing of transaction records over video footage of the transaction.
Traditionally, text overlay of POS receipts required a CCTV camera text inserter box. The text inserter box would need to be connected to the POS and NVR. It also permanently “burned” the transaction data onto the video footage so the original video could no longer be retrieved.
Now, Solink provides text overlay without a text inserter box. Within the Solink platform, users can search for transactions by type, employee, size, time of day, discount level, and more and see videos of all the filtered transactions. Furthermore, the original video remains unaltered so you can see the unobstructed view of what is happening.
However, this begs the question:
Why is text overlay important?
It’s astonishing how much added information and context video can provide. Most Solink users have a list of “high-risk transactions” that loss prevention specialists review as a matter of course. Here are some examples and what video can tell you:
- No sale transaction: In this case, the cash till is opened without a transaction.
- What the video shows: It could be that the employee opened the till and pocketed cash. However, it could also be that the employee closed the till on their necktie and then opened it to get free. Video with text overlay will show you which happened.
- Discount over 70%: The customer received a very large discount on their order.
- What the video shows: It could be that the customer rummaged through the discount bin for maximum savings. However, it could also be that the employee offered their friends a sweetheart deal, one of the many forms of employee theft.
- Voids: This is a canceled transaction.
- What the video shows: It could be a customer having instant regret over their purchase or an employee canceling a sale and then pocketing the refund. Without integrating POS data with video surveillance, it would be difficult and time consuming to find out which happened.
Here is how all the receipts with videos looks in the Solink platform:
What are POS integrations?
Modern POS systems can connect to other systems to provide more value to their users than either system could alone.
How do POS integrations work?
Most POS integrations work by utilizing something called APIs (application programming interfaces). These are a type of code that programmers use to make it easier to connect different hardware and software without creating all new applications from scratch.
Although it is more difficult, even when a public API is not available, it is possible to integrate different hardware and software. Solink has done this for many POS systems.
Benefits of POS integrations
POS systems are powerful tools out of the box. Most POS systems are designed for a particular industry, company size, sales model, etc. and provide added functionality, from operating as a time clock to offering an employee scheduling system.
Most POS systems have opened up their platforms to third-party developers through APIs. Using these APIs, POS integrations can be built and then installed by users to save time, improve revenue generation, cut costs, provide better reporting, and more.
Here are just a few of the benefits of using POS integrations:
- Greater oversight: Especially as your business grows, it is hard to know exactly what is going on in every location and at all times of day. Security can be enhanced by integrating your POS and video surveillance systems.
- Better management: Scheduling, inventory management, and other day-to-day duties become untenable at scale. The right integrations can make your POS the operations management center of your business.
- Save time: From scheduling apps to better metrics dashboards, POS integrations can save you time. For example, Solink can dramatically reduce the time it takes to track down lost inventory or survey high-risk transactions as part of standard loss prevention management.
- Faster growth: The right POS integrations can lead to increased sales, lower costs, and better reporting. This will help ramp up growth in your business.
The benefits you achieve with POS integrations will depend on the types of integrations you choose.
Types of POS integrations
There are many types of POS integrations. The following are just a few of the main functionalities you should consider integrating with your POS.
Cameras are probably the most common form of security infrastructure found in businesses. They provide value as deterrents to internal and external theft. Security cameras also produce evidence for law enforcement when theft does occur.
However, security cameras alone don’t tell the whole story. To find theft, you need to actively watch all of the surveillance footage, and sending clips to the police using USB can be time consuming and expensive. This is where a cloud video surveillance solution comes in.
Indeed, some operators have largely stopped reviewing camera footage unless there is a known event. Solink solves all of these problems by giving users the ability to find specific events while skipping all of the video in between. Solink allows you to search for high-risk transactions and watch videos of them occurring, which improves POS security. You can even share videos with other managers, your insurance company, and law enforcement by email.
Another overlooked need is the ability to perform remote video monitoring. With Solink, you can audit locations from the head office without needing to travel to every location. In addition to loss prevention, you can confirm Occupational Safety and Health Administration (OSHA) compliance, which reduces the chance for hefty fines.
To see how Solink integrates your POS with video surveillance, sign up for a demo today.
Communications and marketing automation
If you’ve ever been asked for an email address at a shop, then you’ve witnessed the customer side of these POS integrations. Email marketing has a very high return on investment (ROI), which makes tools that help you collect customer data and use that information for ongoing communications popular.
While your POS will have some payment options included (that’s what it is for), they might not offer all of the options customers want to use. If you regularly hear requests for a payment system not supported by your POS, it might be time to look for the integration.
Connecting your accounting software with your POS can drastically reduce the time you spend on bookkeeping. QuickBooks, for example, integrates with many POS systems so the revenue side of your income statement can be done automatically.
There are very few shops that are only brick and mortar today. Integrating your POS across the online and in-person sales channels will improve your reporting. You can also use this to keep track of your inventory.
Do you have a loyalty program for customers? Do you send out special discounts to previous customers on occasion? There are loyalty POS integrations that can do all of this for you. Similar to email marketing, loyalty programs have a great ROI as the small discounts provided can be made up with larger sales volume.
Keeping track of inventory is important to make sure that you never miss out on a sale while also not over ordering and seeing items go to waste. POS integrations can automatically update your inventory management software so you can keep track of items going into and out of your business. You can also use this information to track trends in purchases to increase or decrease orders as needed.
As mentioned above, some POS integrations allow you to use your POS as a time clock. You can also create schedules within some of these apps. &pizza uses Toast POS, 7Shifts for scheduling, and Solink together for better operations management.
Having your schedule in the POS can help reduce employee theft, including time theft. With Solink’s security camera integration, you can confirm that the employee signed into the POS is the one doing the transactions.
Along with accounting and staffing integrations, there are also payroll ones that can automatically generate staff pay checks. This includes deducting any necessary taxes or benefits and storing staff bank information for automated direct deposits.
Reservation or appointment management
Restaurants can better anticipate their staffing and inventory needs when many of their tables are reserved days or weeks in advance. Customers like the ability to use online reservation portals to get a table, so reservation integrations can help restaurants fill more tables, make better schedules, and improve inventory management.
However, restaurants are not the only type of business that can use these POS integrations. If your business relies on appointments or other customer schedules, then these integrations might be helpful.
Bad reviews on Yelp, Google, Facebook, etc. can sink businesses. Conversely, good reviews can be amplified as part of a marketing campaign. Reputation management POS integrations allow you to track what people are saying about your business online and react to good or bad reviews. Instead of searching all the different review sites separately, these integrations show you everything in one place.
How to secure your POS system
Loss prevention management often focuses on internal theft. That’s because internal theft can account for up to 90% of all theft, and employee theft often gravitates towards the POS. In fact, some people deride it’s more the “point of theft” than the “point of sale” due to the amount stolen out of POS systems.
However, you can both secure your POS and make your POS part of the security infrastructure for your business. Here are some simple steps you can take to protect your POS system.
Integrate your POS and security cameras
POS security camera integration can go by many different names:
- POS video integration
- POS camera integration
- POS CCTV integration
- POS surveillance integration
Most businesses already have security cameras installed. If there is a security camera facing your POS, then it is possible to pair transaction data with video surveillance for enhanced security. This also provides improved POS monitoring capabilities for new business insights into every transaction.
Then, you can proactively review all of the high-risk transactions at your locations to make sure that no POS theft is occurring. The following are some of the high-risk transactions you should consider searching for in the Solink platform: no sales, refunds, cash refunds, zero-dollar transactions, voided transactions, and transactions with a discount above a certain threshold (e.g., 60% or $100).
Solink gives you eyes on your POS operations so that you can make sure no POS theft is happening in your locations. This can result in thousands of dollars of savings every month.
To see how Solink can improve your POS security, sign up for a demo today.
Install antivirus software
Modern POS systems are computers. They connect to the Internet and have all the same security vulnerabilities as any tablet or PC. One way to protect your POS system is to take all the same precautions as you would with any computer system. This includes installing antivirus software.
Secure data transfers make it harder for hackers to read all of the messages being transmitted between your POS and payment processors. Whenever possible, be sure to end-to-end encrypt your data transmissions.
Maintain a secure network
It might seem obvious to say that you should have a password-protected Internet connection for your POS. However, many businesses offer guest Internet access to patrons and may even give passwords to staff. In this case, consider segmenting your network to have a dedicated connection for your POS system and keep that password confidential. Here are some other tips on password safety best practices.
Keep your POS software up to date
Software companies send out regular updates to keep systems up to date. During normal software maintenance, developers can find security vulnerabilities. When they do, they send out updates to close the security gap before hackers find out.
However, if you don’t install these updates, then your POS system remains vulnerable. If your POS system has the option for automatic updates, it is recommended that you keep that option checked.
Use advanced password protection
Consider adding two-factor authentication (2FA) to your POS login system so someone finding out your password does not lead to a security breach. It is not uncommon to uncover that an employee committing POS theft has used another employee’s password. 2FA makes this nearly impossible.
In addition, don’t forget to remove the passwords of staff when they leave the company. Even if you and the former employee leave on positive terms, this is a major security threat that can be avoided with some proactive security hygiene.
Lock down your POS system
POS systems are not as bulky as cash registers. During a burglary, it is entirely possible a thief could lift up the entire system and run away. Consider physically attaching your POS system to a countertop to make it harder to steal during a burglary.
Consider a smart safe or cashless business model
No one knows your customer profile as well as you do. Do they tend to pay with credit cards or a tap of their phone? How many of your customers who currently use cash could be persuaded to use debit or credit cards? If your business model can justify the change, going cashless means that cash can no longer go missing in your locations.
Alternatively, you can invest in a smart safe. Smart safes connect directly to your POS so free cash is never handled by employees. Armored security personnel swap out the lockboxes so cash is not opened until it reaches the bank teller.
If you aren’t ready to go cashless, be sure to review your cash handling procedures regularly to reduce the chance of cash theft in your business.
Recruit employees into your loss prevention strategy
Employees can be a great resource for POS security. Explain to them how to spot POS theft and that the company takes theft very seriously. Remember, talking to employees about theft needs to be an ongoing conversation. A single conversation is not going to impress upon staff that theft is a serious matter.
Solink is the best POS security integration
POS systems provide a lot of value to businesses out of the box. The biggest benefit of a modern POS system, however, is that they integrate with hundreds of other hardware and software systems.
These integrated business systems can provide everything from easier scheduling and payroll to email marketing and loyalty programs. If you are in the market for greater POS security, then Solink integrates the POS with security cameras to let you see video of every transaction.
To see how Solink enhances the security of your business by integrating POS data and security cameras, sign up for a demo today.