HP Innovation Journal Special Edition: Retail Transformation | Page 27

• What are the hidden costs of repairs? Includes ancillary
costs such as downtime, helpdesk costs and the impact
on productivity. POS devices do not rapidly discontinue models, but rather,
continuously support them while also introducing new
models to offer a wide range of choice for retailers.
• What is the expected product lifespan? A solution with
an expected life of just four to five years must be purchased
twice to match the performance of one with an eight- to
10-year lifespan, plus all associated deployment costs. Reliability is also essential to keep transactions moving
and support costs low. Devices that are purpose-built for
POS are better equipped to stand up to the rigors of the
retail environment, have lower failure rates and therefore
tend to deliver greater reliability.
• How will repair needs and costs change as devices age?
Costs tend to increase over time as more parts wear out.
• What is the cost of energy? Saving $5-$20 per device a
year multiplied across devices really adds up.
A big but often overlooked factor in TCO for POS solu-
tions is device management, particularly when comparing
purpose-built to consumer-grade devices. How often do
changes from the hardware manufacturer force users to
make image changes to maintain compatibility? Look for
stability over time. Consumer-grade products such as PCs
often tweak the platform frequently, so over the course
of a lengthy POS rollout the user may receive different
versions of the hardware.
Every image change costs money. For example, when the
manufacturer updates the operating system, software
must be recertified and/or undergo regression, volume
and/or functional testing across a number of platforms.
There could be multiple manufacturer changes per year.
That in turn unnecessarily drives incremental costs to create,
test and deploy the new images across multiple versions of
the hardware. Frequent image changes mean at any time
retailers are operating multiple versions of the hardware and
therefore different versions of the bios and OS. Tracking all
that in order to provide support increases costs.
THE LIFECYCLE OF POS HARDWARE
Also integral to TCO is the lifecycle of POS hardware
models. Installing new POS devices is not a one-time
event. Store resets, new stores, service and maintenance,
and new use cases such as kiosks all mean retailers are
acquiring new devices long after the initial rollout. Just
as with software changes, when the manufacturer makes
hardware changes after that initial fleet is purchased, it
forces the retailer to support multiple versions.
A retailer-friendly lifecycle means the same POS model
is around long enough to support consistency across the
entire installed base. Manufacturers of retailer-friendly
HOW POS CAN DELIVER ROI
Because of its increased position in facilitating the brand
experience, POS now plays an even bigger role in driving
revenue, and therefore can achieve ROI more quickly.
Well-designed modular POS systems enable innovative
in-store services, from endless aisle kiosks to assisted
selling to information displays in front of products. These
help retailers deliver an engaging customer experience,
increase loyalty, and make operations more efficient. POS
also delivers ROI through:
• Higher solution reliability. This translates into lower
support costs and higher uptime, so retailers don’t risk
losing sales because equipment goes down.
• Faster performance and increased productivity. In busy
periods, shaving even three seconds off transaction time
can significantly reduce lines and, therefore, walk-offs.
• Better customer service. When transactions are easy,
fast and convenient, they help drive increased loyalty,
higher shopping frequency and larger basket sizes.
A well-designed POS platform puts highly reliable, flex-
ible hardware in the right places to allow customers to
do business their way. For example, associates can take
mobile POS devices into the aisle for personalized service,
or outside for line-busting at a busy sidewalk event.
BUDGET AND ACQUISITION MODELS
The investment model retailers choose to finance their POS
upgrade can be either an obstacle or an enabler of POS’
greater role in customer experience and revenue creation.
The traditional approach is a one-time, CAPEX-intensive
purchase. While this may put the retailer in complete con-
trol of its system, it comes with some negatives. After the
considerable effort and costs of implementation, the retailer
is fully responsible for managing, supporting and servicing
equipment. While much of this ongoing lifecycle support
is often addressed by hiring the manufacturer or a third
party, standard maintenance costs for existing systems can
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