POS Hardware as a Service
Point of sale (POS) Hardware as a Service is a sales model in which the end user pays a monthly fee to use POS hardware, such as terminals, monitors, touchscreens, cash drawers, all-in-ones, printers, tablets, barcode scanners, and customer displays. The end user does not own the hardware. Instead, the POS solutions provider maintains ownership and provides service and support according to the terms of a service level agreement (SLA).
Why it Matters to your Customers
The retail and restaurant industries are changing rapidly in response to technology disruption, industry standards, and evolving consumer preferences and behaviors. POS Hardware as a Service allows merchants to have the POS features and functionality they need today with less risk than investing in hardware that may soon become outdated or obsolete.
POS Hardware as a Service can also bring top-of-the-line POS hardware within reach of smaller merchants. Retailers or restaurateurs pay a more affordable monthly fee rather than a large, upfront capital expense, keeping their lines of credit open. Moreover, the monthly fee for POS Hardware as a Service covers installation, service, and support. According to the terms of the SLA, the provider will replace or repair hardware as needed to keep the merchant’s operation running.
Why POS Hardware as a Service is an Opportunity
As a POS solutions provider, POS Hardware as a Service gives you the advantage of having more control over your client’s IT hardware, making it easier for you to maintain and service it. You can eliminate the problem of trying to keep outdated technology in service or deal with integration issues. This can also make your relationships with your clients stickier, since you will manage their IT environment and ensure it is always operational. You can sell deeper by offering POS Hardware as a Service with POS Software as a Service and other managed services to become a one-stop-shop for your client.
POS Hardware as a Service requires an investment on the part of the solutions provider, but pricing correctly will allow you to pay off the equipment and then collect recurring revenue for the balance of the contract. There are a number of POS hardware vendors and distributors that offer financing or other programs to POS solutions providers to help them offer hardware to merchants via subscriptions and lower their risk.
Additionally, some payment processing companies have begun partnering with hardware and software companies to create POS-as-a-Service bundles. One benefit of such a bundle is that the upfront costs of the solution are partially or wholly covered by the participating vendors, lessening or removing the cash flow challenge for you, the solution provider.