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  • Writer's pictureBuck Paolino

How to choose the right Point of Sale System (POS) for your hotel.

What to look for in a Hotel Point of Sale System (POS)!

Recently, I got a call from a hospitality professional who was put in charge of finding a new point of sale system for their hotel. And for those of you who don’t know, POS does not stand for piece of SHI@ but instead Point of Sale. Although, when it comes to technology, I think we all refer to it as a POS at times.

But really, what is the POS and why is it important? A point of sale system manages the food and beverage operations for a restaurant, bar, etc. This is the system that records the financial activity for a restaurant. So think about when you go to a bar and order a drink, the system that records what you ordered, the revenue, the taxes, and the receipt or the payment is all housed in this system. And if you have a restaurant in your hotel it’s a very important piece of technology. So today, I want to run through a few areas that you should review and look for in a POS from your accountants perspective.

Hotel Financials: Start Here!

We are going to be asking ourselves this single question during this process,

“What type of activity do I want to see on my profit & loss statement?”

These two questions are important as they get down to what your owners and leadership team needs to know to make great operational decisions. Let’s jump into that first question,

What type of activity do I want to see on my P&L?

Ok, here you go, the #1 piece of information you need to know is this, so if you are checking email right now come on back to me,

Your Outputs Are Only As Good As Your Inputs.

What does that mean? It means that if you want to know how your bar is performing compared to your pool for each meal period between liquor and beer on your P&L then your POS software must be set up to provide that information. Your P&L cannot give you information that is not already been setup within your POS. Going back to our pool – bar example this would mean your reports need to be able to be run by: Outlet (Pool or Bar) then by Revenue Type (Beer or Liquor) and this should all be cleanly stated on 1 page. There are a lot of reporting systems out there that give you this detail but it requires multiple reports to view this type of information. So your first step in picking out a POS is to think about what type of information do you want to see on your hotel P&L. And in my opinion, being able to view the following is key on a single page:

  • Outlets

  • Revenue Type – Food, NA Bev, Beer, Liquor, Wine, Other

  • Taxes

  • Tips

  • Discounts

  • Settlements

  • Room Charges

  • Guests / patrons

And as a side note, you must make sure any alcohol sales are separate compared to food sales for taxes. I can’t tell you how many times I’ve looked at reports and they have all revenue going to one account. That is not helpful for you, your accountant, or your restaurant team to make good operational decisions. Ok, so that’s the very basics of what you need to see per outlet.

Your Hotel PMS (Property Management System

Next, you want to make sure that your activity can be fully imported into your either your hotel property management system (PMS) or accounting system. And this is so very important because when you have an automatic feed it removes the human error, allows financial reports to be provided sooner, and the need for reclasses from your management team is drastically cut down so they can focus on operations and not running a bunch of reports.

And here’s a tip, if you hear the words “bucket” than watch out! What happens is POS systems will group activity together into a “bucket” and then send that over to your property system or accounting system.

So instead of getting all the details for each outlet like you expect on your P&L, instead you get all Food Revenue for all your outlets grouped together, all your beer, liquor, and wine revenue grouped together making the breakdown per unit absolutely useless. This also means that if you want to get this activity it must be manually tracked at the restaurant by hand and then manually fed into your other systems. So you must be diligent in making sure that whatever POS System you plan on using can provided you the end results you want to see. Side note, you can always manually enter in the POS activity, but this can then lead to discrepancies between reports.

So our tip for this week is to make sure with whatever POS system you plan on using that your outputs must be as good as your inputs otherwise you will have a very expensive and complicated system that doesn’t provide you the details you wish to see.

Alright, I hope that was helpful! If you haven’t signed up for our weekly videos, please do so below!  Talk to you soon! 

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