How Much Does a POS System Cost?

Exactly how much a POS system costs can vary substantially depending on the provider, the industry you’re operating in and what your business has already.

That being said, we estimate that the average business will pay around $1,500 for all the upfront costs and then at least $1,200 per year to use the software thereafter. And of course, there are also card processing fees on each transaction to consider, too.

Of course, you’ll want to cut down as many of these costs as you can – but luckily, some of the best POS systems have affordable starter plans and regularly offer hardware discounts.

Read on for a dive into all the hardware, software, and payment processing fees you could face, as well as how the costs could differ depending on the industry you operate in.

POS System Costs: The Basics

Most of your POS system expenses relate to the hardware rental and the software subscription. Both are normally charged monthly, with the former accounting for the lease of the POS system equipment (such as card readers, barcode scanners, etc) and the latter being the fee the provider charges so you can use their program.

Some providers offer the chance to purchase the hardware or software outright too, though this will cost you more upfront and you may have some maintenance costs to pay for the latter. It’s also a less common option.

Either way, the great thing about a POS system is that it can be as basic or sophisticated as you want. Ultimately, this will depend on the features you need for your particular business type, as well as the number of stores and employees you have, too.

To give you an idea of what you’ll need, we’ve created a guide on expected POS costs. Let’s dive into the hardware you’re likely to need first.

How Much Does POS Hardware Cost?

POS system hardware includes essential payment components such as payment terminals and card readers, as well as other add-ons such as a barcode scanner, receipt printer, or cash drawer.

In 2024, most companies will let you buy or lease POS System hardware depending on your business preferences. For instance, a small, first-time business may want to have the flexibility of renting a product via monthly payments rather than buying the equipment outright.

Many POS systems have proprietary hardware, however, meaning you are likely to have a limited number of options for hardware – although, a few POS systems we’ve tested do support a variety of card readers, registers, and terminals.

And inevitably, hardware from different manufacturers (and with different pricing, even from the same manufacturer) will offer varying features, from wireless connectivity to touchscreen capabilities.

Below we’ve made a quick guide for different business operations, what POS system hardware that business is likely to need, and the upfront cost of those items – although it’s worth noting that you may get a better deal by buying all your equipment in one package than separately.

How Much Does POS Software Cost?

Pricing Models

Firstly, POS software is sold in two main pricing models with the choice of which impacting the total cost.

• Perpetual License: This is an upfront, one-time fee paid for the software license. Here, you may also need to pay an annual maintenance fee. Generally, in the long run, you’ll spend less on a perpetual license however it does require a higher initial investment.
• Subscription License: This is an ongoing monthly or annual payment structure, typically including ongoing software updates. It’s a cheaper option in terms of upfront costs and means you’ll always have the latest software available to use, too. It’s also a far more common option offered by POS providers.

Features

Once you’ve decided what form of payment, there will also be variations in price depending on the features you want or need. Some companies provide smaller, lightweight POS systems that will be too basic for large businesses that need to manage completed inventories as well as a mixture of online and in-person orders – but they won’t cost as much, either.

This gets even more specific when you go sector by sector. For instance, some restaurants may require more sophisticated features such as table management tools, loyalty program functionality, or advanced reporting features.

Jump to our POS Costs by Industry debrief for more details on specific features and some example POS systems we recommend.

Usage Costs: Payment Processing Fees

Besides the costs for hardware and software, there are also the ongoing costs of using POS systems.

For each transaction, a merchant account processes the payments between your terminal and a bank. They can either be provided by your bank, or by a POS supplier, and they will charge a fee to process each credit card transaction.

As a rough guide, standard credit and debit card processing fees in Canada range between 1.3% and 3.5% of the transaction total, sometimes plus a fixed amount depending on the POS or third-party processing company.

These fees can be broken down into three core areas:

• Transaction Fees: This is charged each time a purchase is made using a POS system. Often it is a percentage of the transaction (e.g. 2.5%), a flat fee, or a combination of both.
• Interchange Fees: This is set by the card networks (e.g. Visa or Mastercard) and paid to the card-issuing bank. In this respect, the fees will depend on the paying customer’s card (e.g. American Express cards often have higher interchange fees) and also on the transaction type (e.g. in-person or online).
• Assessment Fees: Assessment fees go to card brands, like Visa and Mastercard, and are usually small, flat amounts per transaction to pay for the network infrastructure that makes card payments possible.

Other factors can influence the size of the fee too, such as the volume of sales and average sale size your business makes, so it’s best to read the terms and conditions of the provider and speak to a financial expert for further advice.

Check out our card processing fee comparison table below for some of the most popular POS suppliers in Canada.

POS Costs by Industry

Here’s a breakdown of the costs of a POS system by industry. Bear in mind that the following costs are a rough guide and you should speak to a supplier for more accurate pricing.

In this section, we’ll compare some of each industry’s most popular POS system packages, comparing the low, mid, and high-price range packages available. The prices shown are either a monthly subscription, or a one-off fee.

How Much for Restaurants?

As a restaurateur, customizing menus, running financial reports and managing ingredients are just a few of your regular assignments. Unspecialized POS systems just can’t handle the heat of the kitchen. Luckily, the best restaurant POS systems are designed with you in mind.

No two businesses are truly the same, and so some will require fewer features. For example, if you need a POS system for your food truck, you won’t need to spend as much on your hardware.

How Much for Hotels?

The more attention you dedicate to enhancing guest experiences, the more revenue you’ll generate from their continued patronage. However, this is easier said than done when you’re juggling multiple check-ins and check-outs, especially during high season.

That’s where a Hotel-specific POS system comes into play. Tailored hotel solutions streamline room reservations, manage check-ins and check-outs efficiently, and handle guest requests effortlessly. Investing in a hotel POS system is a proven strategy to improve the efficiency and profitability of your hospitality business.

How Much for Bars?

As a bar owner, you no doubt keep close tabs on hourly, daily and seasonal trends that affect drink prices. If you serve food, you probably also juggle ticket orders, food preparation and section seating. But what if your POS system could do all of that for you? Specialized bar POS systems can help with all of these tasks, and more.

How Much Do iPad POS Systems Cost?

As touched upon already, using iPad-based POS systems is the preferred option of many small businesses. Most suppliers offer some kind of tablet integration for their software.

Three big benefits of iPad POS systems are:

• Easy to set up and train staff to use
• Mobile, helping staff deliver consistent customer care across locations
• Lower repair and maintenance costs than most desktop-based systems

Next Steps

By now, you should have a better idea of the general POS costs. To summarize, POS system costs depend on three things:

1. Industry: From multi-location retail to independent eateries, different POS solutions target different niches
2. Hardware: The amount of hardware you need usually depends on the scale of your business
3. Software features: Software pricing usually depends on the number of features you need

Bear in mind that POS solutions are no longer one size fits all. It’s now possible to invest in a POS system that is completely tailored to the needs of your business. This means the cost of a POS system should be completely tailored, too.

We know that finding a POS for the right price can be a time-consuming process. But our quick, easy, and free comparison service does all the hard work for you. To receive tailored quotes from trusted suppliers, simply tell us about what you need and they’ll be in touch.