Retailers adopting a ‘Pick and Mix’ approach to payment terminal selection

With the maturity of Chip and PIN technology there is now a far greater diversity of payment terminal models available on the market for retailers to choose from.  These are available from a range of device manufacturers. Gone are the days when one model was expected to meet the needs of all merchants irrespective of their size, sector or store formats. Despite Ingenico and Verifone continuing to hold the major market share of payment terminal shipments in the UK there are a number of different terminal providers offering alternative and highly competitive models. These include Spire Payments, PAX, Miura Systems, Magtek, Aevi, HTEC, Poynt, Yello, HandPoint and iZettle.


What is abundantly clear is that different types of payments acceptance device are needed for each environment. These differences will typically either be in terms of hardware features, communication options, supported software functionality, or price point. Let’s take the case of a large UK supermarket operator. Here they will be looking for a PIN Entry Device that can be integrated with their EPOS software at the checkout. For the self-checkout kiosk they need to support unattended payment terminal operation. At their petrol station they will require fuel functionality and interfaces to multiple fuel systems. On the forecourt they will need outdoor payment terminals. At the in-store café, hospitality functionality is required. The dry cleaners will also have slightly different needs. The pharmacy may again have specific demands. Queue busting mobile POS terminals will be needed in-store and delivery vans may require portable devices that can accept payment at a customer’s door.


Responding to these industry needs manufacturers have developed a wide range of models with different form factors and capabilities, to complement the workhorse countertop payment terminal.


Due to this great diversity it is increasingly common for savvy merchants to support a multi vendor strategy for payment acceptance devices. This recognises that a single supplier is unlikely to be able to offer the best model for each of these device categories. Although there are advantages of having a single payment terminal vendor, such as having only one payment software application (unless using G8) to support and simplified certification/compliance there are also considerable disadvantages.


Taking a ‘pick and mix’ approach generally allows retailers to negotiate far harder and achieve lower device costs. They also can ensure they have the best device for each category, rather than a poor compromise. Due to relative age of the payment terminal model, a next generation mobile terminal from ‘Manufacturer B’ is likely to offer superior functionality to an older model from ‘Manufacturer A’.


However in order for a retailer to manage a mixed estate of multiple payment terminal models from different manufacturers efficiently, they will need to invest in a next generation Terminal Management System (TMS). Such a TMS needs to support any manufacturer’s device agnostically and grow seamlessly with the ever-changing payments and technology landscape.



Tuesday, March 28, 2017