The Past, Present & Future of Payments

Since the very first trade in human history occurred thousands of years ago, the “point of sale” has been in existence in a quite literal sense.

That is, at the most basic of levels, the “point of sale” is and always has been a phrase meaning “the moment at which money is exchanged for goods or services.” It wasn’t until fairly recently that we began using the phrase “point of sale” to mean more than the actual moment of transaction.

As you’re likely aware, “point of sale” as a concept has evolved over the years - as have POS tools and systems. In this article, we’ll take you through the history of modern-day point of sale, explain how each “evolutionary” stage of POS relates to one another, and take a look into what the future holds for POS systems overall.

But before we dig into the history of modern-day point of sale, we need to define exactly where we’ll be getting started, and why.

Defining “Modern-Day Point of Sale”

As alluded to in the intro, discussing the history of “point of sale” as an “event” would require us to dig into the history of money and trade in general.

What we’re going to talk about here, is the history of the modern concept of “point of sale” that began to evolve with the introduction of emergent technology at the actual “point of sale.” As we discuss the evolution of technology along the way, you’ll also notice a shift in terms of why POS systems were and are being used in the first place.

With that in mind, let’s start at the beginning of modern-day POS systems: The invention of the cash register.

1879: The Birth of the Cash Register

The earliest modern cash register was invented back in 1879 by James Ritty, a saloon owner, and his business partner John Birch.

Now, if you’re assuming Ritty’s goal was to invent an easy way to keep track of sales records: you’re right. But he wasn’t looking to track sales records for tax purposes or anything like that; Ritty was simply looking for a way to catch his employees trying to steal from him.

Ritty’s “Incorruptible Machine,” as he called it, recorded the number of sales made, as well as the amount of each sale, as well. While certainly revolutionary in its time, it again was meant to solve a rather simple problem: keep employees’ hands out of the cash box. Ritty almost certainly had no intention of coming to be known as the catalyst for modern-day point of sale.

At any rate, Ritty patented his invention, and eventually sold it to Jacob Eckert - who in turn sold it to John H. Patterson. Patterson would then go on to found National Cash Register in 1884, where the product would begin evolving from a simple theft-detection device to a more robust accounting tool.

1884 - 1950s: The Cash Register Emerges

Soon after the founding of National Cash Register (NCR), we begin to see the emergence of what will come to be known as the “cash register.”

At first, the improvements made were still mainly focused on enhancing security. It wasn’t until 1902 that Patterson and his company began to realize the product could be used for accounting and marketing purposes, as well. It’s around this time that cash registers began to be used to track cumulative totals, provide a paper trail for auditors, and even conduct rudimentary market research. In 1906, Charles Kettering - an employee at NCR - invented a cash register powered by an electric motor. (As we’ll get to in a bit, you might argue that this is the first intentional step toward streamlining and quickening point of sale engagements.)

Soon thereafter, the cash register became a mainstay in retail stores across the country. By 1915, over 1.5 million cash registers were produced and sold throughout the United States. From this time period until the mid-1900s, the cash register underwent a number of changes, mostly centred around improving speed and functionality. Throughout this time period, the cash register from a usage standpoint remained focused mainly on accounting and security-related purposes. This was about to change.

1960s - Present-Day: POS Begins to Evolve

Throughout the 1960s, we saw the emergence of the electronic register.

Needless to say, in terms of speed and convenience - which was almost certainly at the forefront of this new iteration - this was a huge step. But, as the electronic register became more en vogue among retail locations, businesses began to realize that the device could be used for much more than mere recordkeeping.

By the 1970s, NCR had introduced a cash register that could be introduced to the company’s computer system, and introduced a barcode-scanning system that worked alongside this new cash register.

As you can see, cash registers are beginning to gain more and more use cases already. This trend would only continue, as technology such as electronic credit cards essentially demanded that cash registers continue to evolve with the times.

In 1986, we saw Gene Mosher introduce the first graphical point-of-sale system: a touch-screen system that was installed in a number of restaurants across the US and Canada. Then, in 1992, Martin Godwin and Bob Henry invented the first POS system that could run on Windows. In 1998, NCR began rolling out its newest invention: Self-checkout kiosks.

By now, it’s pretty clear that most people - whether on the business or consumer side of things - are starting to see “point of sale” as more than just a simple transaction.

2010: iPad POS Emerges

By the time the first iPad-supported POS system is released in 2010, the message is loud and clear: point of sale encompasses or touches pretty much every aspect of a business. From accounting and security to marketing, sales, and the customer experience, POS processes are woven throughout an organization’s daily operations, which is why POS systems have evolved into what they are today.

Today’s POS Systems

Point-of-sale systems have come a long way. What was once used merely as a way to keep employees from stealing money has evolved into all-inclusive suites that allow companies to easily:

• Record transactions from a variety of sources
• Maintain and manage inventory
• Foster and nurture relationships with customers
• Store information in the cloud using cloud POS systems with robust capabilities and benefits
• Track sales, pull reports and provide deep insights with business intelligence tools

Point of Sale = Stellar Customer Experience

Modern customer experience is often dictated by the quality of a company’s POS system. A high-quality POS system allows companies to:

• Streamline transactional processes, from purchases to returns and exchanges
• Capture customer data to provide laser-focused product suggestions and other content
• Literally meet the customer “where they are” using mobile capabilities like online ordering

Similar to the way that use of the electric cash register spread quickly throughout the 50s, modern POS systems are being adopted by small and large companies alike across the world.

The Future of Point of Sale Systems in 2020 and Beyond

The future of POS systems boils down to three main facets:

• Integration and Connectivity
• Customer Management and Marketing
• Security and Cloud Capability

Point of Sale is Now All-Encompassing

Even in just the last few years, POS systems have become even more central to an organization’s overall operations. Handling everything from accounting to employee tracking, email marketing, inventory management, and much, much more.

What began as a way to keep employees’ sticky hands out of the cash jar has completely revolutionized the way in which retail, hospitality, and other industries operate.

Whether we’re talking about the literal point of sale, or the events and exchanges that occur before, during, and after this engagement, it is vital that all processes go smoothly on both the company’s and customers’ side of the exchanges, and that your company’s and customers’ data remains safe and secure at all times.

For more business advice and guidance, visit our resources hub. To find out more about what an Epos Now system can do for your business, get in touch today.