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If payment upstart Square has its way, payment-taking iPads will be in far more than just taxis.
In its quest to become a payments powerhouse, the company has a much larger target: those ubiquitous POS systems used by millions and millions of businesses large and small in the United States.
How will Square disrupt the POS market? It's as simple as Square: the latest version of its iPad app essentially turns an iPad into a POS system, allowing merchants to accept payments using nothing more than their iPad and the Square card reader. It gives merchants the ability to track and analyze sales history, and even deals with cash payments too, interfacing with a cash drawer and receipt printers.
So is Square in position to displace established POS providers? Its employees are confident. Megan Quinn, director of products for Square, was quoted as saying, "I truly believe POS, as you know it today, is dead." But is she right?
To answer that, you need to answer the question: just how much of the market Square can serve? With this in mind, it appears Square's employees may be a tad overoptimisitic.
Small businesses with a single location and one cash register are certainly candidates for Square, but it's not quite clear that Square would be viable at multi-location businesses and/or with merchants requiring more sophisticated setups. Modern-day POS systems are often industry-specific and do far more than just accept payments. For example, a beauty salon's POS system might be integrated with scheduling software. They're often integrated with inventory management systems as well, allowing merchants to track product stocks as sales are made.
While Square might be able to easily lure merchants who don't currently have POS systems, it's somewhat difficult to see merchants with more than a single bare-bones POS system rushing to jump ship, even if the product is nifty.
That, of course, doesn't necessarily matter to Square. Beyond the "POS is dead" hyperbole, the reality is that Square is targeting a segment of the market that has traditionally not used POS systems. If it can do that, the $4bn in transactions it has processed thus far will look like chump change.