Retailers considering purchasing Point of Sale software need to ensure that software support coverage is optional. We have seen situations where support is not optional and when not paid retailers are blocked from accessing their business data.
Ask the question and get the answer in writing as part of a proposed contract. Otherwise you could find that business data you have gathered through the year is no longer accessible unless you pay a mandatory fee.
At Tower Systems, software support coverage is optional. It always has been. We believe that the data you enter and cultivate using our software is yours to access whenever.
While switching another newsagent to our newsagency software last week, the newsagent called their old newsagency software company to advise them of the move. What was expected to be a courteous call turned nasty quickly.
The owner of the software company yelled at our new customer, criticising their decision to switch to us. In their rant they made several claims about Tower Systems which are untrue. One of our installation experts was on hand to hear the call.
The best way any software company can stop people switching from their software to that of another company is by providing genuinely valuable and up to date software and to back this up with easy to access customer service.
No software company owns a customer. Internally, we regularly remind ourselves that we are only as good as the last support call and only as good as the last software update. The reminders focus our attention on doing our best today, in this moment, and not resting on laurels earned years ago.
Why people purchase software can be different to why they continue to use the software. This is where everyday timely and professional customer service and quality software updates are vital. The lack of either is the usual reason people switch software.
We are thrilled to be growing our newsagency software customer base through acquisition as well as through winning new customers a site at a time. W are equally thrilled with an excellent customer retention rate as indicated through optional annual software supper uptake.
The competitor who yelled at their former customer last week reinforced the decision the newsagent had made some weeks earlier and provided them with a story which will no doubt be shared with colleagues.
We are given information by many suppliers well in advance of announcement to their retail partners. This early announcement allows us to test data files in advance of an announcement by suppliers to their customers. In most cases this data is provided on a confidential basis, some even have a specific embargoed to date. We respect this, keeping the information confidential. It is important to us that suppliers can trust us to be prepared in advance for our customers without abusing commercial in confidence information.
Tower Systems announced to its Point of Sale software customers two weeks ago that support fees for 2012 would remain the same as they were in 2011, 2010 and 2009.
This decision provides our customers with certainty on the costs of maintaining their software and accessing our support services commented Mark Fletcher, Managing Director of Tower Systems. We are thrilled to be in a position to maintain software support fees for four years now.
While the company has maintained software support fees, it has continued to increase services provided to its customers … delivering more value today in 2012 than available in 2009.
All Tower Systems Point of Sale software customers pay a support fee which is published to all users and others who visit the company website. This transparency and the company’s public commitment to a universal approach to support fees is unusual in the vertical market software space.
We do not believe in special support rates to get someone to say good things about our software, commented Mark Fletcher. We want every one of our customers to say good things about us, this is why we take a universal and transparent approach to delivering support services, software updates and charging for these services.
In addition to holding support fees at their 2009 level, the company also announced support free discounts for customers who choose to pay support two or three years in advance. These discounts offer retailers even more opportunities to reduce the costs of maintaining their software and accessing the Tower Help Desk.
The news about support fees remaining the same in 2012 as in 2011 was announced in the January 2012 newsletter which was mailed to all customers late last year. The newsletter contained several New Year ‘gifts’ for Tower customers.
Tower Systems serves in excess of 2,500 retailers across a variety of marketplaces in Australia, New Zealand, Fiji and papua New Guinea.
We often find ourselves logging onto client systems and researching a question or resolving an issue as if we were physically on site. We do this in full view of our customers. This is important as it is their data and their business we are looking at and, possibly, changing. We want our customers to watch, so they are fully aware of what was done.
We have deliberately chosen remote connection technology which requires client transparency and, indeed, approval of our connection to their business – every time. This is vitally important to us and to our clients.
We hear stories of businesses finding system settings or data changed without their knowledge or approval. We don’t do this. We can’t do this with how our systems are setup. This provides our customers with certainty and comfort.
The risk of an easy and or open connection is that it could be abused by the IT company. They could log in and damage the business in some way without leaving a trail. They could, for example, cause problems which force the user to call the IT company’s help desk, thereby generating reliance on and revenue for them. This is one of the risks of unsecure remote connections.
Businesses need to ensure that their IT infrastructure is secure, especially if their relationship with those who established or controlled their IT platform is not as strong as it once was.
An important factor in considering purchasing a Point of Sale system is price. Sometimes the cheapest priced system is the one you want to avoid. Especially if their price is barely what it would cost to purchase at wholesale the hardware in their quote.
Cheap hardware could be poorer standard. It could also not come with the level of support to make it useful. It may not be new. Corners might be cut elsewhere to enable the company to sell so cheap.
We saw this recently when a competitor offered a system at such a price that they would not make money off the deal – regardless of any claim they make about the Australian dollar and the like. What was not in writing was their software pricing model. They factored in that the customer would use the software for several years and would have to pay each year thousands of dollars just to access their own business data. So, what looked like a cheap deal was not when you took a total cost of ownership view over, say, four years.
Our pricing is public, on our website. What you see is what you get. Our transparency on price, commitment to quality hardware and approach to professional and timely support are what win us good business. We can compete with cheap competitors by focusing on what a sales prospect really wants.
Cheap today is of no value tomorrow without reliable hardware and access to quality support services.
We offer professional Point of Sale software backed by on time, helpful and knowledgable advice. The value of these things is far greater to a business than saving a few bucks on cheap hardware of questionable quality.
Retailers are well advised to make careful and honest use of their Point of Sale software following reports of Tax Office interest in how some software packages could be used to commit fraud against the commonwealth.
We do not support, encourage or help retailers using our software to act illegally.
Any software company, retailers or other party engaged in tax fraud using software will ultimately be found out. The work being done by a variety of government agencies in this area is considerable.
So, we share here today a warning: make honest use of your POS software. Use intended to defraud the government will hurt the business.
In the 1990s we were asked for advice by several agencies of the federal government which were investigating the use of retail software from another company. We saw from that investigation that they take using software as a tool of fraud seriously.
The other aspect of this which is important for retailers to understand is that how you use your software will be a lesson to your employees. Use your software to defraud the government and expect your employees to do the same to you.
We have recently seen more evidence of unfair support fees in the Point of Sale software space. One retailer showed us an invoice for more than $3,000 for a year of software support coverage. A nearby retailer showed us an invoice from the same company for the same service to a similar sized business with a charge of under $2,000.
The retailer paying the lower fee is used by the software company tin their marketing. Only those who know that this retailer gets a substantial discount on support fees would wonder if this is compensation for endorsing the software.
Here at Tower Systems, our support fees are published on our website. The only exception is where a business case is made and accepted for short term relief in terms of the support fee payable. We will happily help those in need of financial assistance.
We do not pay for people to say good words about us. We want referrals to be genuine and for the greater good of the user community and not because there is a financial benefit.
We accept our ethical and social responsibilities for fair, honest and transparent treatment of all of our customers.
When we sell our Point of Sale software package we sell it offering perpetual use, with the title to the software resting with the business for which it was sold.
We don’t rent the software or price it is such a way that there is a compulsory support or licence fee to keep the software running year on year.
Sometime, our customers enter into funding arrangements which leave the funding provider in control of the assets at the end of the funding term. This is a matter for the customer and the funder. That said, this type of funding is one fo a variety available for the purchase of our system or any system.
Often, the funding is organised between our customer and their accountant.
How our systems are funded by customers and the status of software ownership is important because of reports that a competitor is saying that we rent out software and that people buying it do not own our software. We do not rent our software. Businesses wishing to purchase for total ownership can and do this with us.
Curiously, the competitor reportedly spreading these stories has a compulsory software licence fee which they charge customers each year. We have seen invoices listing this as in excess of $3,000 per year.
Our advice to anyone facing a situation where a sales person speaks negatively about a competitor in order to get a sale – ask for proof of the claim being made.
We are continuing to lobby federal politicians on the EFTPOS fee changes bring brought in by EPAL, the company owned by the banks plus Coles and Woolworths, later this year.
The changes which are set to come into effect later this year will impact small business retailers, like our customers, considerably. They look set to provide Coles and Woolworths with a competitive advantage.
So, we are maintaining our email and letter campaign to Senators and Members of the House of Representatives to ensure that they are fully aware of the potential impact on small and independent retailers. We are doing this with the knowledge of how much the changes will affect businesses like those we serve. It is considerable given the trigger points established b the recent EPAL decision.
We are working closely with Tyro as well as the Australian Newsagents’ Federation on this.
So far, we have responses from six politicians. The each say they will raise it further within their respective parties. With others lobbying on this issue too we can only hope that those who can impact on the decision which has been made will act.
This is a big business versus small business fight. We are squarely in the corner of small business, small and independent retailers in particular.
As members of the JAA (Jewellers Association of Australia), we willingly commit to and adhere to their Code of Practice. This commits us to observe the highest business and ethical standards set forth in this code. By being part of an association which serves one of our retail channels and committing to their code of practice, we are further demonstrating our commitment to our customers and to the jeweller marketplace more widely.
Not all businesses offering software to jewellers are members of the JAA and are therefore not formally committed to the Code of Practice. This offers jewellers an important distinction.
Establishing a Code of Practice along the lines of that developed years ago by the JAA is something which we would like to see in other retail channels in which we serve.
Hundreds of jewellers in Australia, New Zealand and the broader Asia Pacific region use our jeweller software to manage their jewellery businesses … from the back room to the sales counter, in dealing with suppliers through to sophisticated business planning. 2011 is delivering good growth in sales of our jeweller software.
What a retailer pays for Point of Sale software may not be as important as the cost of ownership over time.
Some Point of Sale systems are ‘sold’ with a one year licence. Retailers buying such a system can be shocked when they receive an invoice charging a compulsory licence fee as it is not disclosed during the sales process.
Imagine how you would feel having to pay a fee to be able to access the data you have diligently accumulated using your Point of Sale software during the first year. Some retailers feel as if they have no choice but to pay what they consider to be an unexpected fee.
Tower Systems does not do this. Our software is sold with a perpetual licence. There is no licence fee, compulsory or otherwise. Our customers are not blocked from accessing their business data.
We see companies charging a smaller purchase price in the first year and what is effectively another purchase price in year two, year three and so on. The total cost of ownership for the small business retailer becomes, in our view, exorbitant.
It is important that retailers considering purchasing a Point of Sale system understand what they are purchasing and what the operating costs will be beyond the first year. These ought to be documented in a form which protects the interests of the customer.
Retailers facing such compulsory fees could consider seeking advice on their legitimacy. There is no harm in asking the question of Fair Trading or your legal advisor as to the validity of an unexpected compulsory licence fee.
Having complete documentation of a transaction to purchase Point of Sale software and knowing for certain what it will cost for four or five years is essential. Sure, it can slow the sale. However, it can also uncover challenges which may save you money in the long term.
We are helping a retailer who purchased Point of Sale software from another company almost a year ago for $2,500. Our quote at the time was $6,500. Our offer was for a perpetual licence, software which did not have a limited life. While we explained the difference between our approach and the ‘licence’ approach of the competitor, we were not successful at winning the business.
Now that the retailer has an invoice for the second year of their ‘licence’ they have realised that they should have more carefully considered the total cost of ownership as we suggested at the time.
In their situation, purchasing from Tower Systems would have saved the retailer thousands of dollars over just a few years.
As is so often the case in business an AMAZING DEAL which is DRAMATICALLY CHEAPER than a high-profile competitor of probably not that amazing.
We hope to have the customer switched soon. Based on the current numbers they will still save money.
We are replacing a competitor’s POS software with our software and needed to reconfigure the computers. The retailer says they were not given original CDs with the computers. While we cannot verify if this is true, it serves as a reminder to all retailers to ensure that you receive original new packaging for all hardware and software supplied with each system you purchase. Not having access to the original CDs presents a challenge for this retailer as they have never been supplied what they actually purchased.
Retailers have every right to be suspicious of POS Software companies which discount heavily through a sales process.
A company which is not making money from each installation will be challenged to properly fund support and development in the future.
A company which has the capacity to go from $28,000 to $20,000 to $15,000 to $12,000, for example, was either trying to charge way too much to start with or is worryingly desperate to get your business. We have seen this several times over the last few months from one company. They discover we are quoting and drop their price several times. In one case we saw them offer their software for free just to keep a customer.
These are not structured published offers. No, they are in response to a competitive situation. Sometimes hardware and software, sometimes just software. There appears to be no pattern to the discounting except, in our view, an air of desperation.
Our advice to retailers is – be suspicious of chunky discounts. A cheap POS System today may not be so cheap tomorrow.
Retail is tough and some POS Software companies are finding this tough to deal with. Using price as your differentiator is not sound business.
Here at Tower Systems we have a structured and transparent approach to discounts based on our package deals. We reward loyalty, as all good businesses do.
As the first newsagent software company to deliver an integrated direct to Gordon and Gotch supply change request, we are enjoying first mover advantage on this and related innovation. Yesterday, we won a sale by proving that we had a facility which one of our competitors did not have and claimed we did not have.
Here at Tower Systems we take our sales and marketing claims seriously. If we say we have a facility, we have the facility. It makes a competitor look dumb when they say we do not have something which we have advertised and the sales prospect contacts us to find out who is telling the truth – ourselves or our competitor.
This particular competitor has form in saying things about us which are not true.
As we proved yesterday, we were telling the truth … and another newsagent joins the Tower Systems user community. Karma.