Point Of Sale Software Market Size, Share & Trends Analysis Report By Application, By Deployment Mode, By Organization Size, By End User (Restaurants, Hospitality, Healthcare), By Region, And Segment Forecasts, 2020 - 2027

Report Overview

The global point of sale software market size was valued at USD 8.2 billion in 2019 and is projected to expand at a CAGR of 10.1% over the forecast period. The need to carry out cashless transaction, keep track of sales, inventory records, and improve sales strategy using analytics across retail chains, restaurants, hospitality, drug stores, automotive shops, etc. are driving the demand for point of sale (POS) software. Rising demand for advanced features such as employee management analytics, inventory tracking, sales monitoring, customer data management, and reporting are expected to boost the adoption of POS software across various industries.

The demand for robust and cost-effective POS solutions with advanced functionality and analytics has considerably increased due to complex business operation scenarios. These solutions help users manage their inventory, customers, payment, billing, and employees. The POS software required for managing multiple business operations needs to be installed either on desktop, laptop/notebook, or tablet, with a compatible operating system for further usage. Additionally, the growing adoption of cloud-based solutions has boosted the demand for cloud-based mPOS software. Also, the web-based POS solution has gained traction among the small and medium business retailers owing to its affordability and easy access directly from the internet or web browser, which is expected to boost the market growth over the forecast period.

The vendors need to consider certain factors while developing POS software such as different operating systems support, payment methods, and managing and creating a customer database in a structured format. For instance, nowadays merchants demand a cost-effective and flexible POS solution that can be used with various hardware devices such as PC, laptops, mobile, and tablets. Hence, the software is expected to be compatible with the various operating systems such as versions of Windows, Linux, Mac OS, Android, and iOS. This will help vendors cater to a large number of customers without compatibility issues between software and hardware.

The key challenge for the market is to develop the POS software which can meet the multi-channel requirement. For instance, industries such as retail, packaged food service, and other business, have gradually shifted toward online sales (e-commerce) channels to expand their reach across the world. This is generating the demand for POS software that can be efficiently deployed to meet multi-channel requirements of managing large scale inventory, facilitating payment, and streamlining other business processes. The software features preference varies across industries, which challenges vendors to create a different solution for each user.

Application Insights

By the application, the point of sale software market has been classified into fixed POS and mobile POS segment. The fixed POS segment dominated the market in 2019, accounting for over 58% of the overall market share. The growth can be attributed to the current preference of most brick-and-mortar restaurants and retail stores for a fixed POS solution over mobile POS since they provide more functionality and features. The consumer is inclined toward using a fixed POS system due to benefits such as robust management solutions with business functionality, employee time clocks, a cash drawer, inventory management, loyalty programs, and gift card management.

The mobile POS segment is projected to grow significantly during the forecast period. Technology evolution has changed the payment method and the installation of mPOS ensures quick payment via apps without the need of system being connected to a local network. The payment is initiated through a credit card reader attached to a smartphone or tablet, which have apps installed to run the scanner and charging system. Growing adoption of mobile POS terminal by small businesses to carry out advanced functionalities such as inventory management, store management, and analytics to improve business operation has boosted the market growth.

Deployment Mode Insights

The on-premise segment held the highest market share in 2019, owing to higher adoption by the large enterprises, which runs on the local server over the remote facility. Large enterprises have a huge volume of sensitive customer information prone to data breach. Hence, on-premise deployment of software provides more control to the owner, thus ensuring better security of crucial data.

With advancements in technology, the cloud-based deployment has started gaining traction. Moreover, the software for the mobile POS system has gained traction owing to ease of using these small devices for quick payment service. The ease of payment based on monthly charges for availing cloud-based software is another factor allowing the demand to grow among price-conscious end-users. Hence, the cloud deployment mode segment is expected to witness the highest growth rate from 2020 to 2027.

Organization Size Insights

Large enterprise segment will dominate the market over the forecast period owing to increasing demand for customized POS software solutions by large enterprises to manage their cash flows and business operations. Such tailor made POS software is highly priced than the readily available software. The customized software for a large enterprise has to manage an array of business operations while improving customer engagement.

The market for the Small and Medium Enterprise (SME) segment is expected to expand at the highest CAGR of 11.7% over the forecast period. The SMEs are readily adopting cloud-based mobile POS software solutions owing to its affordability and scalability. Moreover, small and medium-size businesses often expand at the city or state level and prefer budget-friendly systems based on word-of-mouth by similar business owners. Therefore, the SME user contribution to the POS software market has been vital in helping vendors expand their presence in the local market. The vendors targeting local business owners are focusing on small and medium-size local businesses across retail, hospitality, healthcare, and other major industries.

End-user Insights

On the basis of end user, the market is segmented into hospitality, restaurants, healthcare, retail, warehouse, entertainment, and others. The retail segment dominated the market in 2019 and was valued at USD 2.8 billion. The retail sector is the prime user of POS software. The industry is changing rapidly with the growth of multi-channel and e-commerce retailing and can perform better during the forecast period.

Increasing adoption of innovative payment options by small retailers globally has driven the market in the retail sector. Retailers are extensively adopting both mobile as well as cloud-based POS technologies that have created the necessity to integrate mobile and web-based platforms to provide omni-channel experience to their customers.

The restaurant POS software segment is poised to register a CAGR of 10.2% over the forecast period since it is another lucrative segment for the vendors. Rising integration of restaurants with online delivery providers is a key feature influencing POS purchases. Online ordering and delivery are expected to drive POS investments in 2020 which will in turn help restaurants avoid costly third-party fees. Data analytics, order management, marketing, and payments in the restaurant industry have led to a staggering trajectory and are expected to augment over the coming years. Also, the tourism industry growth has positively affected the restaurant business and necessitated the deployment of POS software for better service to travelers.

Regional Insights

North America market was valued at USD 2.4 billion and also held the largest share of the overall market in 2019. The region has a presence of prominent POS software vendors and has a high demand and adoption for advanced integrated systems. The healthcare industry in the U.S. is expected to witness the fastest growth rate owing to the need for improving facilities in hospitals related to payment, insurance, and management of patients. According to the American Hospital Association’s survey in 2018, there were 6,148 hospitals that required cost-effective and robust POS software integrated with all insurance payment processing, patient financial services, reporting, and accounting to provide complete payment processing. Moreover, increasing adoption of cashless payment, growth of retail, restaurant, hospitality, healthcare, and other industries in North America is anticipated to propel the market growth over the forecast period.

Asia Pacific is expected to expand at a significant CAGR over the forecast period. Increasing adoption of POS terminals in the region due to growth in the electronic payment industry is expected to boost the market growth. The demand for cashless payment in retail, restaurant, entertainment, warehousing, and other industries in developing countries such as China, India, Indonesia, and Vietnam is further augmenting the growth of POS software in the region. Moreover, the ever-increasing demand for POS solution with advanced features among rapidly growing businesses such as e-commerce, retail, foodservice industry, and entertainment are expected to drive the market growth over the forecast period.

Point Of Sale Software Market Share Insights

The prominent vendors competing in the market include NCR Corporation; Revel Systems; Oracle; Agilysys, Inc.; Clover Network, Inc.; Diebold Nixdorf, Incorporated; Epicor Software Corporation; Ingenico Group; Intuit, Inc.; Lightspeed; PAR Technology Corp.; SAP; Toshiba Tec Corporation; ShopKeep; and Toast, Inc. The vendors are focusing on providing differentiated and consistent brand experience as operators are looking for more functionalities and features from existing systems.

There is strong competition in the market owing to the presence of large number of POS software vendors. The vendors have opted for a mix of inorganic and organic growth strategies to increase their market share. For instance, Restaurant Manager LLC developed and commercially launched its new hybrid cloud POS solution named Duet in 2019, which is a low-cost solution with powerful management and reporting tools along with robust operational functionality for restaurants.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis on the industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Grand View Research has segmented the global point of sale software market report on the basis of application, deployment mode, organization size, end user, and region:

• Application Outlook (Revenue, USD Million, 2016 - 2027)

  • Fixed POS

  • Mobile POS

• Deployment Mode Outlook (Revenue, USD Million, 2016 - 2027)

  • Cloud

  • On-premise

• Organization Size Outlook (Revenue, USD Million, 2016 - 2027)

  • Large Enterprise

  • Small and Medium Enterprise (SME)

• End-user Outlook (Revenue, USD Million, 2016 - 2027)

  • Restaurants

  • Hospitality

  • Healthcare

  • Retail

  • Warehouse

  • Entertainment

  • Others

• Regional Outlook (Revenue, USD Million, 2016 - 2027)

  • North America

    • U.S.

    • Canada

  • Europe

    • Germany

    • U.K.

  • Asia Pacific

    • China

    • India

    • Japan

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa (MEA)