The History of POS Systems in Five Key Steps

17 June 2021

Modern point of sale operations across the retail, hospitality and leisure industries are hi-tech affairs with a wide range of touchpoints and digitised services available. But how did we get to where we are today?

Here’s a brief history of how point of sale has evolved, from the very first mechanized cash registers to cloud and mobile POS systems and touchscreen self-service kiosks.

1879 – Ritty’s Incorruptible Cashier

The journey towards point of sale systems as we know them today probably starts in the US with a saloon keeper from Dayton, Ohio named James Ritty. Fed up with bar staff pocketing cash from sales, he dreamt up a mechanical device that could log every sale. His ‘incorruptible cashier’ was the first recognizable cash register.

It took a while for the concept to take off – Ritty reputedly sold just one of his new inventions before selling his company to one Jacob H. Eckert, who added a cash drawer and a bell to alert bosses each time a sale was ‘rang in’. Then in 1884, Eckhert sold his company to John H. Patterson, who founded the National Cash Register Company.

Patterson added printed receipts to improve bookkeeping and, with the help of a professional sales team, finally pushed the cash register concept into the mainstream.

1973 – IBM and the First Computerised POS system

Cash registers underwent relatively little in the way of evolution for much of the next century, aside from becoming standard mass-produced equipment now found in every store, bar or restaurant. The first cash register with an electric motor rather than a hand-cranked lever mechanism was developed as early as 1906, but this was a long way off the ‘electronic cash registers’ or ECRs familiar from the last four to five decades.

An ECR is really a computerised machine. While electronic rather than mechanical keys gradually became the norm in the post-war period, it wasn’t until 1973 that IBM developed the first computer-powered cash register. This was also the first networked POS system as we understand it today, as it was possible to run up 128 registers recording all sales data in the same central repository.

1986 – ViewTouch Touchscreen POS System

Computerised ECR and POS technology evolved rapidly through the 1980s. IBM was heavily involved again – the launch of the Model 5150 in 1981, the first recognizable ‘PC’, opened the door to IBM also developing the first POS system that could be run from a standard desktop computer in 1985.

McDonalds played a key role, too. In 1984, William Brobeck created a bespoke microprocessor-powered cash register for the fast food giant that had a different button for every item on the menu, speeding up order-taking. This innovation in the hospitality sector was taken a step further in 1986 when New York deli owner Gene Mosher built ViewTouch, a software programme for Atari ST that applied the different-button-per-item concept to a graphical interface.

Not only that, but ViewTouch was designed to be compatible with emerging touchscreen technology, paving the way for the touchscreen POS systems so commonplace today. ViewTouch remains available to this day as a license-free option for the hospitality sector.

1992 – Electronic Point of Sale (EPOS or POS system)

After Mosher’s invention of a graphical interface programme for restaurant POS systems, the next step on the path of POS evolution was the development of complete software suites that could handle all point of sale functions (plus a whole lot more).

Up to this point, ECRs that could essentially only process sales and print receipts had to be connected to separate computers to handle things like sales reports and inventory updates.  EPOS or POS software was developed to manage everything together.

Nisyst is widely credited with being the first complete POS (or EPOS) software package, released in 1992. But it was arguably the arrival that same year of the first POS package for Microsoft Windows, IT Retail, that changed everything.

As the Microsoft operating system revolutionized computing, the number of (E)POS platforms built for Windows in the wake of IT Retail exploded, offering customer-facing businesses more choice and flexibility in their POS solutions than they had ever previously enjoyed. (E)POS programmes let businesses mix and match software with a much wider choice of hardware, and eventually led to the development of all-in-one POS terminals containing a CPU, so separate desktop computers were no longer needed.

Early 2000s – Cloud POS

The first impact the arrival of the internet had on POS systems was the possibility of networking large numbers of terminals over very large distances. This suited chains in particular, as it allowed them to start centrally controlling point of sale operations across multiple stores, as well as combining sales and inventory data and so on.

But an even bigger impact of the internet was the emergence of cloud POS. Rather than having to install, configure and manage software directly on local machines, cloud POS creates a ‘plug and play’ option where you simply access POS functions ‘as a service’ via an internet connection.

Cloud technology has led to dramatic reductions in the cost of POS software, making premium-level services available to businesses of all sizes. It has also further accelerated the decoupling of POS software from hardware – nowadays, you can access cloud POS suites on any device with a browser, regardless of operating system and other limitations in compatibility. In the past 10 to 15 years, this has driven innovations like mobile POS, where tablet-like devices connect to the cloud wirelessly and provide point of sale functionality on the move.

Early 2000s – Self-Service Kiosks

At the same time, as Cloud POS began to emerge, another major trend in the history of point of sale was evolving rapidly in parallel – self-service kiosks.

Self-service is actually a pretty old concept, with vending machines dating back to the 19th century in the US and the first self-service gas station credited to Denver , Colorado convenience store owner John Roscoe in 1964

The first step towards self-service becoming commonplace in retail came in the early 1990s when an enterprising upstate New Yorker by the name of Dr Howard Schneider introduced what he called a “service robot” – what we’d recognise today as a self-service checkout lane – in the Price Chopper in Clifton Park. Within 10 years, self-service checkouts were commonplace in large grocery stores across the country.

By that time, a sleeker, more versatile version of the self-service concept, minus the clunky baggage weighing area familiar in grocery stores, was also starting to take off. The airline industry was the first to really take to these ‘kiosks’ – standalone touchscreen units that could be customised with ticket or baggage label printers, passport scanners and so on. They had a rapid and noticeable impact on reducing the long queues that were a common sight in airport baggage halls.

The great attraction of the kiosk concept is its versatility. Nowadays kiosks are found pretty much anywhere you have a POS or cash desk, either to complement or replace in-person sales.