Glossary
POS terms explained
The words you will hear when comparing systems, in plain English — so a quote or a demo makes sense the first time.
The short answer
A POS (point of sale) is the software and hardware where sales are rung up. Around it sit kitchen displays, handhelds, kiosks and card readers; inventory, staff and reporting tools; and the payments setup. Knowing a few terms — station, integrated payments, offline mode, effective rate — makes quotes and demos easier to compare.
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The system
- POS (point of sale)The software and hardware where a sale is rung up: menu or item lookup, payments, receipts, inventory, staff and reports. Most modern POS systems run in the cloud with local devices at each station.
- StationOne place where orders or sales are taken: a register, a bar terminal, a handheld or a kiosk. Pricing and setup are often counted per station.
- Handheld (tableside) orderingA small device staff carry to take orders and payments at the table or bar, so orders reach the kitchen sooner and the card never leaves the guest.
- KDS (kitchen display system)Screens in the kitchen that replace printed tickets: orders appear by station, in the order they are due, with timers and recall.
- KioskA self-order screen customers use themselves, common in quick service. It usually needs its own menu layout and payment device.
- Integrated vs standalone paymentsIntegrated: the card reader is connected to the POS, so the amount goes to the reader and the payment is recorded automatically. Standalone: a separate terminal where the amount is keyed in by hand.
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Running the business
- ModifiersOptions attached to an item — size, toppings, temperature, “no onions” — that change what the kitchen makes and sometimes the price.
- CoursingHolding and firing items by course (appetizers, then entrées) so the kitchen times each table.
- Tabs and pre-authorizationA bar tab opened against a card; the card is authorized up front and settled when the guest closes out, which protects against walkouts.
- Matrix inventoryRetail inventory tracked by variant — size, color, style — so each combination has its own stock count and barcode.
- PLU (price look-up code)A short number for items sold without a barcode, such as produce, often used with a scale at the register.
- Price bookThe full list of items and prices a store sells. In convenience stores and fuel sites it is often updated from vendor files.
- Age verificationPrompts or ID scanning at checkout for age-restricted items such as alcohol and tobacco.
- Loyalty and gift cardsPrograms that reward repeat customers or sell stored value. Balances may need to move if you change systems.
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Reliability and security
- Offline mode (store-and-forward)What a POS can still do when the internet drops. Some systems keep taking orders and store card payments to send later, with limits and risks that vary by platform.
- EMV and contactlessChip cards (EMV) and tap payments (contactless, including phone wallets). Both are more secure than swiping a magnetic stripe.
- PCI DSSThe card industry’s security standard for businesses that accept cards. Your setup and processor determine what you need to do to stay compliant.
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Buying and switching
- Merchant agreementThe contract with the card processor: rates, fees, term and what happens if you leave. Read it before signing — an “application” can be binding.
- Early termination feeWhat you owe if you end an agreement before its term. It can be a set amount, an amount based on months left, or repaying a discount.
- Equipment leaseA separate contract to rent card terminals or POS hardware over a fixed term. Leases can cost far more than buying and may not be cancellable.
- Effective rateAll processing fees divided by card sales for the month — the one number that compares any pricing.
- Cutover (go-live)The day you switch from the old system to the new one. Plan it away from peak days and keep the old system running until the new one has settled.
Questions owners ask
Common questions
- What is the difference between a POS and a card terminal?
- A card terminal only takes payments. A POS also runs the menu or item list, orders, inventory, staff and reports, and can connect to a card reader so payments are recorded automatically.
- What is a KDS?
- A kitchen display system: screens in the kitchen that show orders by station and due time instead of printed tickets.
- What does offline mode mean for a POS?
- It is what the system can still do when the internet drops. Ask which screens keep working, whether cards can be taken, for how long and with what limits — it differs by platform.
- What is an effective rate?
- All processing fees for the month divided by card sales. It is the simplest way to compare different pricing on the same basis.
Still deciding?
Answer a few questions about how your business runs and see which setups fit — before you share any contact details.