Should you start your new point of sale system/barcode application by entering your existing customers? This question gets asked all the time. The answer is definitely… maybe. Let’s take a look at what kinds of businesses really need customer data and just how much it costs (in time and money) to enter data into a POS system.
Customer data is dynamic, fluid and changing. Every day, every minute, your customers are moving to new homes, getting new phone numbers, buying new cars and leaving town. New customers are showing up all the time. Should a business owner even bother to put in old data?
Over the course of several decades in point of sale, and thousands of installations, I have observed businesses taking six or even twelve months to put in their old customers and a bit of information about them. That is before they even start using the system – in other words, they delay starting to use their new point of sale system to add old data. We know, from the national home ownership statistics, that people move every 4.5 years. If a retailer spends a year putting in customer data, then by the end of 12 months, at least 22.5% of that information is inaccurate. I’d bet the number to be even higher because customers change phone numbers, email addresses and other parts of their persona even more frequently. That’s a lot of useless data that someone got paid to enter into the system.
Now – what about the type of business you are in? Do you even need or want to track your customers purchases? Do your customers even want you keeping track of what they buy? I belong to a frequent buyer club at my local liquor store. They give me a discount key tag with a bar code that they scan when I come in. Occasionally they email me a list of specials. I am not sure I like them keeping track of what I purchase.
On the other hand – when I take my car in for an oil change or other service, I love the fact that they have my complete service records in their point of sale system in case I need them for something. So: the answer to the question at the top of the page in part depends on the type of business you are in.
Recently I needed to get a warranty repair on an expensive road bike I had purchased a few years before. The frame had cracked and the manufacturer was going to replace it, but they wanted a receipt. Unfortunately I could not find the receipt and had to go back to the store to get a copy. Luckily that store owner could produce it readily. And in doing so, he certainly endeared himself to the customer!
POS System Value
One of the incredible values associated with keeping a list of customers with a POS system is the ability to email them, direct mail them or call them – if you get their permission to do so. In the world of opportunities for generating business, there is no lower hanging fruit than your existing customer base. Reasons to reach out to them occur regularly – new products arriving at the store, products being discontinued and are now on closeout. Changing your business location is a reason to contact your customers. And (one of my favorites) reaching out to your customers to ask how you can improve your service.
What about the 80/20 rule? Remember this rule? It says that 80% of your business comes from just 20% of your customers. Hmmm. If we entered just 20% of the existing customers into the point of sale system (the ones we see most frequently), we will speed up our transaction time at the counter and overall, not annoy anyone by making them wait while we enter their data at the point of sale. That’s sounds like a more user friendly, less stressful, less costly approach.
If we kept a little notebook at the counter, and wrote down the names of those customers who are not in the POS system when we go to ring them out – then we will keep things speeded up and STILL get the value of ringing out those items and keeping our inventory accurate. I suggest adding those customer names during slow hours so that you don’t annoy them when they are just trying to complete their business.
To summarize – it’s probably best to start ringing items as quickly as you can into your new point of sale system, and add your more frequent customers as you go along – although not necessarily at the time of sale.