Know and understand characteristics and uses of computers in the retail industry including point of sale (POS) terminals and electronic funds transfer at point of sale (EFTPOS) terminals

ICT Applications – Retail Industry (POS & EFTPOS)

Learning Objective (AO1)

Know and understand the characteristics and uses of computers in the retail industry, including Point‑of‑Sale (POS) terminals and Electronic Funds Transfer at Point‑of‑Sale (EFTPOS) terminals. Apply this knowledge to typical retail scenarios (AO2) and evaluate the impact of these technologies on efficiency, security and customer service (AO3).

1. Role of Computers in Retail (AO1)

• Automation of routine transactions – faster checkout, reduced human error.
• Real‑time inventory control and automatic stock replenishment.
• Generation of sales, profit and trend reports for managerial decisions.
• Improved customer service – loyalty programmes, personalised offers.
• Integration with accounting, supply‑chain and e‑commerce systems.

2. Common ICT Applications in Retail (AO1)

1. Point‑of‑Sale (POS) software and terminals.
2. Electronic Funds Transfer at Point‑of‑Sale (EFTPOS) systems.
3. Barcode scanning and label printing (recognition systems).
4. Customer Relationship Management (CRM) tools.
5. Stock‑management and automatic ordering (expert systems).
6. Digital signage, interactive kiosks and self‑service terminals.
7. Online store front‑ends (HTML/CSS/JavaScript).

3. Expert Systems in Retail (AO1 & AO2)

• Definition: Computer programmes that use a knowledge‑base of rules to make decisions or give recommendations.
• Key Components:

  1. User interface – where staff or managers input queries.
  2. Knowledge base – collection of facts about products, suppliers, pricing.
  3. Inference engine – applies logical rules to the knowledge base.
  4. Explanation system – shows the reasoning behind a recommendation.
  5. Database (facts) & Rule base (IF‑THEN statements).

• Typical Uses:

  • Predictive stock‑replenishment – analyses sales history and suggests order quantities.
  • Fraud detection – flags unusual card‑payment patterns for review.
  • Dynamic pricing – adjusts discounts based on inventory levels and demand.
  • Employee rostering – matches staff availability with predicted footfall.

• Advantages & Disadvantages

  Aspect	Advantages	Disadvantages
  Decision speed	Instant recommendations, reduced manager workload.	May suggest sub‑optimal orders if data is poor.
  Consistency	Uniform decisions based on defined rules.	Rigid – difficult to adapt to sudden market changes.
  Cost	Long‑term savings through reduced stock‑outs and waste.	High initial development and maintenance costs.
  Transparency	Explanation system helps staff understand suggestions.	Complex rule sets can become opaque.

4. Recognition Systems (AO1 & AO2)

• Barcode scanning: Optical recognition of the black‑and‑white pattern on a product label; instantly retrieves product details from the database.
• OCR (Optical Character Recognition): Reads printed price tags or handwritten receipts for automatic data entry.
• RFID / NFC tags: Contactless identification used for quick stock checks and “tap‑and‑go” payments.
• Biometric recognition: Fingerprint or facial scanners used for secure employee log‑ins, cash‑drawer access, or high‑value customer verification.

5. Satellite & Cloud Systems (AO1)

• Internet‑based POS/EFTPOS: Sales data synchronised to a central cloud server via broadband or satellite links – essential for remote or mobile stores.
• GPS tracking: Provides real‑time location of delivery vehicles, enabling accurate ETA updates and route optimisation.
• GIS (Geographic Information Systems): Analyses foot‑traffic patterns and assists in site selection for new outlets.
• Satellite communication: Enables POS connectivity in areas without reliable terrestrial networks (e.g., rural kiosks, pop‑up stalls).
• Satellite TV/Phone: Used for in‑store advertising and for voice communication between head office and isolated stores.

6. Point‑of‑Sale (POS) Terminals (AO1 & AO2)

A POS terminal is a computer‑based system that records sales, updates inventory and produces receipts.

• Key Characteristics

  • Runs specialised POS software (often cloud‑based).
  • Touch‑screen interface for rapid data entry.
  • Connected peripherals: barcode scanner, receipt printer, cash drawer, scale (for weighed items).
  • Local storage of the day’s transactions with automatic backup to the cloud.
  • Multiple user log‑ins with role‑based access control.
  • Integration capability with EFTPOS, CRM and accounting modules.

• Primary Uses

  • Scanning items, calculating totals and applying taxes.
  • Issuing printed or e‑mail receipts.
  • Updating stock levels instantly.
  • Applying discounts, coupons and loyalty points.
  • Generating end‑of‑day, weekly or monthly sales reports.
  • Managing price overrides and special promotions.

7. Electronic Funds Transfer at Point‑of‑Sale (EFTPOS) Terminals (AO1 & AO2)

EFTPOS terminals process debit/credit card payments by communicating securely with banking networks.

• Key Characteristics

  • PCI‑DSS compliant encryption (AES‑256) for card‑holder data.
  • Supports EMV chip, magnetic stripe and contactless (NFC) cards.
  • Integrated with POS software – payment data automatically linked to the sales record.
  • Provides merchant and customer receipts (paper or digital).
  • Handles refunds, partial payments and split‑tender transactions.
  • Tamper‑evident hardware and secure boot to prevent physical tampering.

• Primary Uses

  • Authorising card payments in seconds.
  • Reducing cash handling and associated security risks.
  • Collecting electronic transaction data for financial analysis.
  • Facilitating charge‑backs and dispute management.
  • Supporting contactless “tap‑and‑go” for faster checkout.

8. Comparison of POS and EFTPOS Terminals (AO1)

9. Systems Life‑Cycle for a Retail POS Project (AO1)

1. Analysis: Assess current checkout processes, identify user requirements, evaluate hardware constraints.
2. Design: Create data‑flow diagrams, database schema, UI mock‑ups and hardware layout.
3. Testing: Unit test of software modules, integration test of POS‑EFTPOS communication, user‑acceptance testing in a pilot store.
4. Implementation: Install hardware, configure network, migrate legacy data, train staff.
5. Documentation: Produce user manuals, troubleshooting guides, system‑admin procedures.
6. Evaluation: Monitor performance (checkout time, error rate), gather user feedback, plan future upgrades.

10. Typical Retail Transaction Flow (AO2)

1. Cashier logs into POS → selects “New Sale”.
2. Barcode scanner reads each product → POS retrieves price from the inventory database.
3. POS updates stock levels in real time.
4. Customer presents a debit/credit card → POS sends total to the integrated EFTPOS terminal.
5. EFTPOS contacts the bank, receives authorisation, and sends a receipt code back to POS.
6. POS prints (or e‑mailed) a combined sales & payment receipt.
7. Transaction data is stored locally and synchronised to the cloud for end‑of‑day reporting.

11. Advantages & Disadvantages – Evaluation (AO3)

12. Safety & Security (AO1 & AO3)

• Physical safety: Secure placement of cash drawers, anti‑theft locks, ergonomic workstation design, CCTV monitoring.
• E‑safety: Strong passwords, regular software updates, anti‑virus protection, secure Wi‑Fi (WPA3), firewalls.
• Data security: Encryption of card data, PCI‑DSS compliance, regular backups (on‑site & off‑site), role‑based access control.
• Threats & Counter‑measures

  Threat	Potential Impact	Counter‑measure
  Malware / Ransomware	Loss of transaction data, downtime.	Up‑to‑date anti‑virus, regular patching, offline backups.
  Phishing / Social engineering	Unauthorised access to admin accounts.	Two‑factor authentication, staff awareness training.
  Card‑skimming / Data interception	Financial fraud, loss of customer trust.	PCI‑DSS compliant terminals, tamper‑evident hardware, end‑to‑end encryption.
  Unauthorised physical access	Theft of cash or hardware.	Secure cash‑drawer locks, alarm systems, restricted staff areas.
  Network outage	Inability to process sales.	Redundant broadband/satellite links, UPS power supply.

• Disaster recovery: Daily automatic cloud backup, weekly off‑site backup, UPS for power continuity, documented recovery procedures.

13. Audience & Copyright (AO1)

• Audience design: Interfaces must be simple for cashiers, clear dashboards for managers, and intuitive for self‑service kiosks.
• Copyright legislation: Use only licensed POS/EFTPOS software; respect copyright for product images, brand logos and third‑party databases; avoid software piracy and ensure all licences are up‑to‑date.

14. Communication (AO1 & AO2)

• Automatic e‑mail receipts and SMS order confirmations.
• Web‑based dashboards accessed via secure HTTPS for remote managers.
• Netiquette: protect customer privacy, obtain consent for marketing messages, use professional language.

15. File Management (AO1 & AO2)

• Transaction logs saved as CSV or XML files – easy to import into spreadsheets or databases.
• Suggested folder structure:

  Retail/
  ├── 2025/
  │   ├── 09/
  │   │   ├── Transactions/
  │   │   └── Reports/
  │   └── 10/
  │       ├── Transactions/
  │       └── Reports/

• Version control for software updates and configuration files (e.g., Git or a simple “v1.0, v1.1” naming scheme).

16. Images, Layout & Styles (AO1)

• Receipt layout: Company logo (image), bold headings, clear itemised list, QR code for e‑receipt download, tax breakdown.
• Web‑based POS dashboards: Consistent colour scheme and fonts defined with CSS; responsive design for tablets and desktops.

17. Proofreading & Error Checking (AO1)

• Automatic validation of barcodes (checksum) before adding to the sale.
• Real‑time alerts for negative stock levels or price overrides.
• Proof‑reading of printed receipts – clear fonts, correct totals, legible QR codes.

18. Graphs & Charts – Sales Reporting (AO2)

Typical reports generated by POS software:

• Daily sales bar chart (total sales per hour).
• Top‑10 products pie chart (share of revenue).
• Month‑over‑month line graph of gross profit.
• Heat‑map of store footfall by day and time.

19. Databases (AO1 & AO2)

A simple relational schema for a retail POS system:

Forms allow cashiers to enter a new sale; queries retrieve “sales today”, “low‑stock items” or “loyalty‑member purchases”.

20. Spreadsheets – Modelling Sales Data (AO2)

• Import the daily Sales.csv file.
• Use SUM() to calculate total revenue.
• Apply IF() to flag sales above a discount threshold.
• VLOOKUP to retrieve product names from a separate product list.
• Conditional formatting to highlight items with stock < 5.
• PivotTable to summarise sales by product category and by cashier.

21. Presentations – Communicating Results (AO2)

Typical slide‑deck (e.g., PowerPoint or Google Slides):

1. Title slide – “Monthly Sales Review – September 2025”.
2. Key performance indicators (KPIs) – total sales, average ticket, number of transactions.
3. Bar chart of hourly sales.
4. Top‑5 products – images and sales figures.
5. Recommendations – stock adjustments, promotional ideas.
6. Conclusion & next steps.

22. Website Authoring – Online Store Front (AO1 & AO2)

Three‑layer web development model:

• Structure (HTML): <header>, <nav>, <section> for product listings, <footer>.
• Presentation (CSS): Styles for brand colours, responsive grid for product tiles, hover effects.
• Behaviour (JavaScript): Add‑to‑cart function, live stock check via AJAX, client‑side form validation.

Example snippet:

<div class="product">
<img src="img/shirt.jpg" alt="Blue T‑Shirt">
<h3>Blue T‑Shirt</h3>
<p class="price">$19.99</p>
<button onclick="addToCart(101)">Add to cart</button>
</div>