Computers in the retail industry Revision Notes

POS systems are computerised setups used at retail outlets to record sales transactions instantly. When a customer purchases an item, the POS system scans the product's barcode, registers the sale, and updates the stock file automatically. This real-time stock management helps retailers maintain accurate inventory records without manual counting.

POS systems often include automatic reordering features. When stock levels fall below a preset threshold, the system can generate purchase orders to suppliers, ensuring that popular items remain available and reducing the risk of stockouts.

For example, a supermarket POS system might detect that only 10 packets of a particular cereal remain and automatically reorder 50 more packets from the supplier. This automation saves staff time and improves stock availability.

• POS systems record sales and update stock files automatically.
• Automatic reordering helps maintain stock levels without manual intervention.
• Barcode scanning speeds up transactions and reduces errors.

EFTPOS systems enable customers to pay electronically at the retail location. When a payment card is used, the system validates the card details and authorises the transaction by communicating with the bank's network.

Chip and PIN technology enhances security by requiring the customer to enter a personal identification number (PIN) after the card is read. This reduces fraud compared to magnetic stripe cards.

Contactless payments allow customers to pay by tapping their card or device on the reader for small amounts, speeding up the checkout process. Near Field Communication (NFC) technology underpins contactless payments and also supports mobile wallet transactions via smartphones or smartwatches, providing convenience and security through encryption and tokenisation methods.

• EFTPOS validates payment cards by communicating with banking systems.
• Chip and PIN technology requires secure customer authentication.
• Contactless and NFC payments enable fast, secure transactions without PIN entry for small amounts.
• Retail and banking systems interact to authorise and settle payments quickly.

When a customer pays using EFTPOS, the retail system sends payment details to the bank's payment gateway. The bank verifies the card's validity, checks for sufficient funds, and confirms the transaction. This process usually takes a few seconds, allowing immediate payment confirmation.

If the payment is approved, the bank sends an authorisation code back to the retail system, which completes the sale and updates the transaction records. If declined, the sale is cancelled, and the customer is informed.

This seamless interaction requires secure network connections and encryption to protect sensitive cardholder data during transmission, complying with payment industry standards.

• Retail systems communicate with banks to authorise payments in real time.
• Authorisation codes confirm successful transactions.
• Secure data transmission protects customer payment information.

Online shopping uses internet-connected computers and devices to allow customers to browse, select, and purchase products remotely. Retailers provide websites or apps with product catalogues, descriptions, images, and customer reviews.

Benefits include convenience, as customers can shop anytime and anywhere without travelling to a physical store. Online stores often offer a wider range of products than physical outlets, including items from multiple suppliers.

For example, a customer can order electronics, clothing, and groceries from different retailers in one session, with home delivery options available. This flexibility appeals to many consumers, especially those with busy schedules or limited local shopping options.

• Online shopping is accessible 24/7 from any location with internet.
• Wider product selection compared to physical stores.
• Convenient home delivery options reduce the need to visit stores.

Despite its advantages, online shopping has limitations. Delivery times can vary, causing delays compared to immediate purchase in-store. Shipping costs may also increase the total price.

Customers cannot physically inspect or try products before buying, which can lead to dissatisfaction if items do not meet expectations. Returns and refunds processes may be time-consuming and sometimes costly.

Security concerns exist regarding online payment fraud and data breaches, although secure payment gateways and encryption mitigate these risks when properly implemented.

• Delivery delays and shipping costs can affect customer satisfaction.
• Lack of physical inspection may result in unsuitable purchases.
• Returns processes can be inconvenient and slow.
• Online payment security requires robust protection measures.