What is a Cloud POS system?

Cloud POS symbolized by view of cityscape buried in clouds
(Image credit: Aleksandar Pasaric from Pexels)
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With payment technology evolving at eye-popping speed, consumers continue to be bombarded with a variety of different payment options at retail operations. The invention of some of the best cloud POS systems (opens in new tab), or web-based point-of-sale systems ever seen, allows retailers to provide a variety of payment platforms easily and from the same device, minus the hassle of an old-school cash register.

With the variety of options for modern-day cloud POS systems, it can be a headache for business-owners to understand which option they should choose. TechRadar breaks down the benefits of top-rated cloud-based systems in this article

TechRadar also states that a recent study revealed that 50% of consumers globally prefer could-based payment methods versus the hassle and inconvenience of carrying cash. This leads to higher customer satisfaction, and opportunity to build retention, gather valuable data, and upsell additional products or services. 

What is cloud point of sale system and what are the components of a cloud-based POS system? 

A could POS system is an online point of sale system that allows business owners the ability to process payments through the internet rather than a desktop computer. Cloud-based POS systems let operators store transaction, inventory, employee and other business data on a remote server. 

Given that cloud POS systems fall under SaaS (Software as a Service)  they often employ a subscription model for business-owners. As an owner, this means you have access to tech support, automatic software updates (a big selling point from traditional POS systems), staff training and dedicated account management, plus enhanced encryption security. 

This technology provides business owners the opportunity to operate more competently, and effectively for their consumer-base. Transactions are faster, safer, and track more data than ever before. 

Old battered cash register

There'll be no need for one of these anymore! Everything is digital with a cloud-based POS system, meaning you only buy the POS hardware you need.  (Image credit: Enrico Hänel from Pexels)

Cloud POS systems are also capable of running on virtually any device – including a tablet or cell phone. Small businesses such as boutique retail operations, food trucks, mom and pop restaurants, home service providers, etc. highly benefit from these systems as they are more-feasibly transportable for on-the-job transactions. 

That’s not all either – cloud-based POS systems also allow operators to access their point of sale from any location as well and manage their business remotely. With the advancement of internet technology, most cloud systems rely on a wireless network, so there isn’t a need to connect physically to a land-based server. 

By today’s standards, a POS system that is only available on-premise doesn’t cut the mustard.


So what are the components of this savvy modern payment system? Well, it can be made up of hardware and software. A stable touchscreen is needed to serve as the system monitor, allowing consumers to utilize a pen, or fingertip, to navigate through the transaction. A customizable customer touchscreen display provides the business owner the opportunity to ask customers to sign up for loyalty programs, review orders, sign receipts, etc. And of course a card reader is required to take payments.

A hard drive is also a necessary component to ensure efficient system operations. Some cloud-based systems have upgraded to SSD (solid state) hard drives, which run smoother and more efficiently than standard hard drives. A router can be included to allow the business owner the ability to securely send data between various devices, and a printer to provide hard copies of any necessary documentations. 

What are the benefits of Cloud POS Systems?

Woman using mobile payment app on escalator

For customers, cloud-based POS systems offer the flexibility to pay for goods and services anywhere, anytime.  (Image credit: Future)

An article by financesonline.com (opens in new tab) breaks down the significant benefits cloud-based systems have over legacy systems through their retail consulting research. Here is what they discovered: 35% of retailers are already offering personalized rewards based on customer loyalty. 

Meanwhile, 23% of retailers plan to offer personalized rewards within 12 months, and another 23% plans to do the same within 1-3 years. For 79% of shoppers, a key consideration when looking for stores to shop is personalized service. With this in mind, let's look at the benefits of cloud-based POS systems and what they empower your business to do:

  • Manage your inventory better and reduce human error by storing information as soon as transactions are completed
  • Restaurant owners can track sales data from any store at any time
  • Eliminate the need for clunky space-consuming computers with handheld devices or small table- top devices
  • Save on expensive certifications and service fees 
  • Keep current data as your software has automatic-updates
  • Personalize your promotions and interactions with customers by having access to their shopping preferences
  • Easily integrate with e-commerce applications

The benefits of cloud POS systems vs legacy POS systems

An article by ConnectPOS (opens in new tab) compares the benefits of Cloud POS systems, vs traditional on-premise POS systems. Here is what they discovered:

“Cloud POS system has a core benefit when it synchronizes all actual transactions. POS will update automatically all data between online and offline stores at the happening time. 

It is extremely beneficial if you operate multi-stores at different locations. For instance, when you sell an item at a specific store, the available amount of that item on that outlet will be changed accordingly. In addition, the level of stock is immediately deducted in the warehouse.” 

How much does a cloud POS system cost?

Business owner calculating cloud POS costs

(Image credit: Shutterstock)

This is always the question-of-the-day when it comes to technology isn’t it? In our guide to the Best POS systems (opens in new tab) we advise that business owners will likely only pay once for hardware, then monthly for software use and additional services. Not all providers charge a monthly fee, however, but rather take a percentage from the transaction, such as Square. 

We also state that costs have come down in recent years, and the payment screen, card reader and printer can be acquired for the cost of a single terminal – around $600. The options vary depending on which components you choose for your business. 

Today's top cloud-based POS systems

Swipe to scroll horizontally
POS system Lowest monthly fee Card rates Free trialSupport
AirPOS $29.99 Integrates with iZettle, SumUp, and WorldPay 14 daysOnline form
Lightspeed $69 2.6% + 10¢ 14 days24-hr phone support (reduced weekend hours)
Shopify $292.7% 14 days24/7 chat support
Epos Now $39 Integrates with iZettle and others30 daysEmail support (Pro: 24/7 phone support)
Square$02.6% + 10¢N/APhone and chat support

Which is the best cloud-based system? 

Each owner/operator has varying needs, so the best cloud POS system will depend on how it will be utilized. When researching a cloud-based system for your business, consider the following questions:  

  • What is your budget?
  • Which integrations do you need your POS system to be compatible with? 
  • How experienced you are using POS software?
  • What kind of customer data do you want to gather? 
  • Do you want customizations?

The top-rated systems per industry are: 

Swipe to scroll horizontally
Cloud-based POS System Industry/Use
Lightspeed Large Retailors/Store Management
Revel Systems POSLarger Businesses
Square POS New/Small Businesses
Vend POSMidsize Retailers/Building Customer Loyalty
Shopify POSOmnichannel sales

As it relates to the overall operator and consumer journey, Square POS (opens in new tab) tends to be the most highly rated system, stated by fitsmallbusiness.com. With a $0 monthly fee for retail and restaurant owners (a major perk compared to its competitors) this cloud-based POS system has a low card interest rate of 2.6% + $.10 and positive consumer experience.

If you're looking for advice about POS systems for specific type of business, then take a look at Tech Radar’s guides to choosing the best POS systems for small business (opens in new tab)POS systems for restaurants (opens in new tab), and POS systems for retail (opens in new tab)

With over 13-years-of-experience in the marketing, public relations and non-profit fields, Erin is a driven copy and content writer, digital designer, strategic planner and public speaker. Throughout the course of her career, Erin has managed multiple teams, bringing sales and marketing success to non-profits and for-profit organizations. She brings empathetic, devoted leadership to the team, drives growth through tactical thinking and a consummate work ethic.