Vendor vs. Custom POS Software

Updated: Jul 6

Point of Sale software: Vendor vs. Custom

"Quality is the complex concept. To assess or improve software quality in your organization, you must define the aspects of Quality in which you are interested and then decide how you will measure them. Ultimately, your notion of Quality must be related to your business goals. Only you can determine if good software is good business."

Barbara Kitchenham, Professor of Quantitative

Software Engineering at Keele University

For any enterprise that uses software, its Quality is particularly determined by business needs satisfaction. The same pattern concerns the Point of Sale systems. Today JEVERA's focus is on the dilemma: "The Custom Point of Sale software or the Vendor one?" Sometimes companies choose digital products that don't solve problems but create them. This article aims to figure out which POS will work productively in any restaurant, chain of stores, or gas stations. Let's define the most suitable system for each specific case.

How Do POS Software Providers Design Vendor and Custom Products?

POS system is a set of software and equipment that conducts settlement operations, provides tax information transferring, and performs several other functions that depend on each business type. For example, the grocery retail Point of Sale understanding is measured with the above features. For it, the POS is just a convenient place for quick customer service. In non-food retail, the system covers significantly more procedures and can be rightfully considered as the store management point. It's able to track goods and run the majority of processes on the sales floor. Look, even within the same industry, POS performs different tasks.

So, all business representatives face the question of where to get a robust Point of Sale system, which executes all required functions and even more.

Sure, each company has its features, monetary resources, and a vision of further development. Based on these factors, management needs to purchase a Custom or Vendor POS system. But first, it must understand what each of the above products is.

So, there are two ways to get the Point of Sale software: to buy a subscription to an existing solution or order a product development from scratch. In the first case, we are talking about a Vendor POS; in the second case - about a Custom one.

Vendors can develop both solutions. A vendor or a supplier is a separate, outsource company that provides software development services for its clients.

If a supplier creates a universal POS solution for a specific business niche, like hotels, it's a Vendor Point of Sale. Vivid examples of vendor solutions can be Microsoft, SAP, and Oracle products.

But if a customer contacts the supplier company with a request to develop POS software, the result will be considered a Custom system. The vendor will then work on a software package for only one customer, assessing its needs and business features. In other words, the main target of such a Point of Sale is to solve a particular company's issues. Along with an outsourcing company, any client's internal IT-team can solely design and support a POS.

Thus, the vendor Point of Sale is a system designed on the developer initiative for business industries. This solution operates on a subscription basis.

Custom POS is a system where the software part is developed for a particular company and considers its features.

Custom Made And Vendor POS Systems: Pros and Cons

Each of the systems is efficient in its way and suits its audience. However, some of their disadvantages are best considered before purchasing, as they can significantly affect the POS further usage. But the benefits first.

The business should pay attention to a Vendor POS system for its:

  • Reliability. Especially when it comes to large vendors' products. They ensure impeccable data safety and fast system operation.

  • Availability. Subscribing to a ready-made product is significantly cheaper than developing from scratch.

  • Speed. A company can start using the digital product right away, while custom POS designing can take months.

  • Scalability. The system can process a countless number of users' requests every second, doing it without crashing.

Vendor POS Systems

On the other hand, the Vendor POS system has several cons, including:

  • Vendor dependency. The user will not adjust the software to fit its business or update components - the supplier does it all. Even when the vendor is ready to change a software following a subscriber's order, it might be an expensive procedure.

  • General approach. A vendor cannot consider each specific company's wishes. It analyzes the needs of the audience as a whole and develops something universal. This product isn't always suitable for industries with a dynamic market situation.

  • Unreliable vendor. The system operation's key things are high-quality components, functions performance, and data safety. If the supplier can't provide it all, better to stop using its services.

Among the primary advantages of the Сustom Point of Sale system, it's worth highlighting the following:

  • Individual approach. The product is developed for a certain company, considering its strengths and weaknesses. Thus, it will always function more efficiently than the Vendor counterpart.

  • Flexibility and independence. The user has the opportunity to update the software components as soon as the need arises, especially when the solution was designed on an open-source platform basis.

  • Multifunctionality. These POS systems can be hybrid, in other words - they can perform functions and use components specific to different types of Point of Sale.

Custom POS Systems

Some of the main disadvantages of a Custom system are:

  • Higher cost. The Custom POS development cycle consists of a few stages: an analysis of the current customer's situation to design a suitable solution and a development and further permanent support phases. All of them impact on the final product value.

  • Time-consuming. The development phase can take much more time compared with Vendor software implementation. The time frame depends on certain business features and process complexity.

The Best Point of Sale Software Solution: The Choice Between The Custom and Vendor One

Thus, there are big distinctions between the Vendor and Custom POS systems. In the first case, the development result is less flexible. It's designed for a wide range of users and takes into account the general audience's needs. In the second case, the POS system is developed based on specific customer analysis. It's used within one company and allows updating the system when the user needs it.

Based on its characteristics, the Vendor system is more suitable for chains of restaurants or cafes, bars, family hotels, which have a standard set of processes and standard requirements for the POS software. HoReCa industry has and uses a variety of Vendor solutions. It's because many hotels or restaurants successfully operate without a chain creation. They need convenient, low-cost products that run smoothly and quickly to implement. Small shops also buy a Vendor POS because they have no issues that this system does not cover.

Who Chooses Which Type of POS

On the other hand, a large business has completely different needs. Here chains of restaurants, hotels, shops, and gas stations mostly use Custom POS systems. It's hard to manage processes within a sizable system if the software wasn't designed for its scale. Based on this, restaurants and hotels are ordering development from scratch for keeping track of products and assets more efficiently. Retailers buy customized software to control the activities of all stores around the world equally well. The retail market is so dynamic. It requires adaptability and quickly responding to the surrounding business environment. The Custom Point of Sale system allows it by an opportunity to make improvements.

Since POS performs almost all functions related to equipment and process control in gas stations, this industry especially needs unique software solutions. In this case, Point of Sale should handle the fuel supply, manage the procedure of cars refueling, purchasing food/non-food items, preparing reports on the excisable goods sale, etc. Therefore, for gas stations, Custom systems are the most suitable solution.

Choosing a Vendor or Custom POS system, a company should focus on its business niche, the scale of its activities, priorities for today, and the main goals for the future. In this instance, it's easier for management to determine which solution will be the most optimal in a particular case.

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