Merchant Technology Requirements: What Tech Do You Need for Optimal Efficiency?
Behind every successful merchant today is a set of different technologies making the business run smarter, faster, and more effectively. Choosing the right combination of software to go with your platform can make or break your business.
Your hardware represents technology too, of course. In this chapter, however, we’ll be looking at software, data storage, and other digital solutions that are robust enough to address your current operations, yet agile enough to accommodate additional growth.
Almost by definition, eCommerce is a tech-forward industry. Just having an online store isn’t enough to ensure success. But an interconnected technology system – what’s known as a tech stack – that’s carefully developed and wisely configured can give you an advantage over companies with haphazard software implementation.
You can leverage your tech stack to help automate tedious tasks, manage your inventory, track shipping and fulfillment, and keep fraud at bay. Key technologies to consider include:
Point of Sale (POS) System/eCommerce Platform
The cornerstone of your sales operation is your point-of-sale (POS) system: the combination of hardware, software, and payment services that you use to process transactions.
For brick-and-mortar retailers, a modern POS system is often an all-in-one package. You can use it to submit transactions for processing, manage inventory, provide valuable analytics, and more.
If you’re a smaller online merchant, chances are you’re operating through an eCommerce platform like Shopify or WooCommerce. Most will handle the above tasks, but will also function as an always-open, always-available digital storefront.
Payment Processor & Gateway
To accept online payments, you'll need a payment gateway and a payment processor. The terms are commonly used interchangeably, but they are two very different things.
Your payment gateway securely captures and transmits customer payment information to your payment processor, while your processor works with banks and card networks to authorize and settle transactions.
Many payment gateway providers are also payment processors, which can simplify things. Gateways are typically part of the POS systems that are integrated into platforms provided by companies like Stripe or PayPal.
Inventory Management System Services
A business of any size — but especially established or growing merchants — can benefit from a dedicated inventory management system.
This software integrates with your sales channels and provides a centralized view of your stock levels across all locations. This helps you to avoid stockouts, manage purchase orders, and track inventory movement, resulting in fewer fulfillment failures, higher customer satisfaction, and greater profitability.
Accounting software is designed to help you automate many accounting tasks, from facilitating expenses management to compiling tax information.
Most accounting software packages interconnect with other systems. That can be a huge help with general ledger upkeep, inventory tracking, applying discounts, and recordkeeping. Other apps (or add-on modules) can simplify redundant tasks such as payroll, pension or union deductions, bonuses, and so on.
Accounting software can’t always compensate for chargebacks
The best way to deal with that? Avoiding chargebacks altogether.
What gets measured gets managed — hence the importance of analytics and reporting tools. These solutions give you insights into every aspect of your business, from website traffic and conversion rates to customer behavior and sales trends.
Google Analytics, for example, can be combined with the reporting features of your POS, inventory management, and customer relationship management (CRM) systems. This interconnection can help you optimize marketing efforts, improve the customer experience, and quantify your business growth.
These are just some of the more basic elements you’ll want in your tech stack. There is a world of other applications that can help with everything from marketing and tax preparation to employee scheduling.
