Computers in Retail | IGCSE Information and Communication Technology Preparation - Year 11 PDF Download

Point Of Sale (POS)

Point of Sale (POS) systems are computerized setups commonly found at checkout counters in retail stores. They serve as vital tools for processing transactions and managing inventory.
Here's an overview of POS terminals and Electronic Funds Transfer at Point of Sale (EFTPOS) terminals:

Point of Sale (POS) Terminals

• Functionality: POS terminals process transactions and calculate the total amounts due. They incorporate various components such as barcode scanners, touch screens, and receipt printers to facilitate smooth checkout experiences.
• Inventory Management: POS systems automate stock file updates and track inventory levels in real-time. By preventing discrepancies and ensuring accurate records, they streamline inventory management processes.
• Stock Replenishment: POS terminals can automatically order new stock when inventory levels are low. This proactive approach helps minimize stockouts and optimize supply chain management.
• Enhanced Efficiency: With POS terminals, retail establishments can enhance operational efficiency, streamline checkout processes, and improve overall customer experiences.

Electronic Funds Transfer at Point of Sale (EFTPOS) terminals

• Enable customers to make payments using credit/debit cards
• Part of a secure transaction system

Functions of EFTPOS terminals:

• Payment Processing: EFTPOS terminals enable customers to make payments using credit/debit cards as part of a secure transaction system.
• Card Verification: These terminals check the validity of cards, ensure they are active and not expired, and reduce the risk of fraud through mechanisms like chip and PIN technology.
• Enhanced Security: EFTPOS terminals employ two-factor authentication, requiring customers to enter a personal identification number (PIN) for added security.
• Contactless Payments: EFTPOS terminals support contactless card payments, allowing for faster transactions by enabling customers to tap their cards on the terminal. This method utilizes Near Field Communication (NFC) technology.
• Mobile Payments: EFTPOS terminals facilitate payments through smartphones and other NFC-enabled devices, offering increased convenience and flexibility for customers.
• Communication and Verification: These terminals establish secure communication channels between the supermarket's computer system and the bank's computer, facilitating instant payment processing and verification.

Internet Shopping

Internet shopping refers to the process of buying goods or services online via websites or mobile apps.

Characteristics of Internet Shopping

• Online Accessibility: Online stores are accessible through web browsers, allowing customers to browse and shop from anywhere with an internet connection.
• Product Variety: A wide array of products and services are available, ranging from everyday essentials to specialty items.
• Convenience: Internet shopping is convenient, with most online stores operating 24/7, allowing customers to shop at their convenience.

Advantages of Internet Shopping to the Customer

• Time-saving and Convenience: Customers save time by shopping from home or on the go, avoiding queues and busy stores.
• Product Variety: There's a greater variety of products available online, and customers can access the global market.
• Comparative Shopping: Customers can easily compare products and prices, making informed purchasing decisions.
• Customization Options: Internet shopping offers customization options, allowing customers to personalize items or services to their preferences.
• Potential Cost Savings: Online shopping often offers competitive pricing due to lower overheads, and customers can take advantage of sales and promotions.

Disadvantages of Internet Shopping to the Customer

• Security Concerns: There are risks of fraud or identity theft when providing personal and financial information online.
• Limited Physical Interaction: Customers can't physically touch or try products before purchasing, which may lead to dissatisfaction or the need for returns.
• Delivery Delays and Fees: Customers may experience delays in delivery and incur additional costs for shipping and handling.
• Impersonal Customer Service: Resolving issues or returning items may be challenging due to the lack of face-to-face interaction with staff.

Advantages of Internet Shopping to the Business

• Targeted Marketing: Businesses can tailor prices, products, and services to specific customer groups based on buying data, enhancing marketing effectiveness.
• Efficient Stock Management: Websites allow for quick updates on stock availability and prices, enabling businesses to manage inventory more effectively than physical stores.
• Cost-Effective Promotion: Online platforms offer cheaper alternatives to traditional advertising methods like mail shots, making it easier to publicize special offers.
• Global Reach: Internet shopping provides access to an international customer base, expanding market reach beyond geographical limitations.
• Increased Profits: Lower overhead costs, such as reduced staff requirements, contribute to higher profits for online businesses.

Disadvantages of Internet Shopping to the Business

• Increased Competition: Online businesses face fierce competition from a global market, posing challenges beyond local competitors.
• Cybersecurity Risks: Online transactions expose businesses to digital fraud and security threats, potentially leading to financial loss and reputational damage.
• Technical Issues: Website downtime or glitches can hinder customer transactions and impact user experience.
• Delivery and Returns Costs: Businesses bear expenses associated with shipping products to customers and managing returns, which can be substantial.
• Customer Trust: Lack of physical interaction may result in customer uncertainty and trust issues.
• Inventory Management Complexity: Keeping accurate track of inventory across multiple online channels can be challenging.
• Depersonalization: Online interactions may lack the personal touch, making it difficult to build relationships with customers.
• Impact of Reviews: Negative online reviews can significantly influence the business's reputation and customer perception.
• Dependency on Internet Infrastructure: Stable internet connectivity is crucial for smooth business operations.
• Logistical Challenges: Managing warehouse operations, packaging, and shipping can be complex and costly, particularly for smaller businesses.
• Legal Compliance: Online businesses must adhere to various laws and regulations, which can vary by jurisdiction.
• Rising Customer Expectations: The convenience of online shopping has led to heightened expectations for fast, free delivery and exceptional customer service.