| Just Ask Gary... | |
By Gary McMullen | Founder, Retail Systems Group | Spring 2005 I am looking for a POS system for use at my Retirement Community. My consultant told me that I can I just use a simple Restaurant POS system but a colleague from another community warned me against it. What is the difference? - P.Vernon, FL
A POS and Meal Plan Management system like CARDWATCH will not only track the declining balance of meals on a plan in real time, but allow the administrator to define what items are meal plan eligible (eg. glass of milk is eligible but a quart of milk (grocery item) is not), how many meals can be taken in a given dining location (eg. dining room vs café) and assign different price levels based on the dining location (eg. higher price level at your full service dining room vs self-serve café) for the same items. Since meals on plan are typically tax exempt and extra charges are not, the system must be smart enough to know which items to tax within a transaction, keeping in mind that the tax rules may not only be different for each resident, guest or employee, but for the same resident at different times (eg. when a Resident runs out of meals on plan, subsequent meals become fully taxable). Alternately, this complex decision can be left up to the server, however, keep in mind that errors in even just 10% of your transactions may result in over 300 manual adjustments per month. Instead of saving time, it is now costing you time. By eliminating the server from the decision loop, applications like CARDWATCH remove the possibility for error in sales tax altogether. Standard POS systems cannot and will likely never be designed to handle this sort of tax scenario simply because it applies only in special circumstances like Retirement Communities. As further incentive to install a proper POS and Meal Plan Management system, both the IRS and State Sales Tax departments are cracking down on sales tax compliance with little or no mercy. With a system like CARDWATCH that automatically handles transaction taxability, there is little to worry about. Lastly, do not be fooled by the price tag of a standard POS systems; they are considerably less expensive than Meal Plan Management POS systems to acquire, but always end up costing more because they cannot handle the complexity of your transaction environment or automatic export to your accounting system, forcing you to do manually, what you purchased the system for in the first place. Most Meal Plan Management POS systems also make use of ID cards that eliminate the need for manually keying in account numbers or names of Residents, thus eliminating costly keying errors that result in forgiven charges and lost admin time. -------------------------------------------------------
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A standard restaurant POS system safely assumes that customers will pay published prices for items will settle their bill by cash, bank debit or credit card and will always pay the sales tax. In a retirement community setting, we know much more about the “Resident”. What we do not know is whether the meal they are about to consume is a “Meal On Plan” or an “Extra Meal”; whether they receive standard pricing or preferred pricing; or whether the items in that transaction are taxable or non-taxable. Standard Restaurant POS Systems are simply not designed to handle any of these situations or decisions. Period. 