How Does Shopify POS Work? Features and Functionality Explained

Retailers often struggle with managing sales across different channels, leading to inventory mismatches, inefficient order processing, and staff access issues. How does Shopify POS work to solve these challenges? It unifies in-store and online transactions, ensures accurate inventory tracking, provides smooth order fulfillment, and maintains controlled staff permissions. This article explores its key features and how they help businesses operate more efficiently.

Highlights:

• After choosing the plan pricing, setting up anf integrating Shopify  POS with your store, the system is ready to work.
• With Shopify POS, you can manage business operations from end to end, covering inventory management, customer management, payment processing, staff management, and many more.

How does Shopify POS work?  

How does Shopify POS work in a highly competitive market? 

Holding a 0.52% market share and ranking #22 among 213 competitors, it faces strong competition from industry leaders like Square (27.96%), Toast (24.23%), and Retail Sales Manager (10.64%). Despite its smaller share, Shopify POS remains a trusted solution for businesses looking to integrate online and in-store sales smoothly. 

Inventory management

Keeping track of stock levels helps prevent overselling, ensures timely restocking, and avoids unnecessary surplus. Shopify POS provides tools to monitor available products, determine when new stock is needed, and recognize when certain items are overstocked.

Making adjustments at the right time helps maintain accuracy. Updating inventory when stores are closed and online traffic is lower can prevent errors. For businesses with fewer locations and products, modifying quantities directly on the Inventory page is a simple approach. Those managing a wider range of items across different locations can rely on the bulk editor or use CSV file imports and exports for quicker updates.

Customer Management

How does Shopify POS work for customer management? Customer management becomes more structured with stored purchase history, allowing businesses to recognize buying patterns and create personalized promotions. Contact details, order history, and preferences help shape marketing efforts. Gift cards, store credit, and loyalty programs encourage repeat visits, strengthening long-term relationships.

For example, a clothing boutique using Shopify POS can track purchases both in-store and online. When a customer buys a dress at the physical location, the system updates stock levels instantly, preventing overselling if another customer tries to purchase the same item online.

For customer management, if a frequent shopper regularly buys denim jackets, the store can send personalized promotions on new arrivals in that category. The system also allows them to apply store credit from a previous return or use a gift card at checkout, making transactions more convenient.

Payment methods

Shopify POS allows businesses to accept different payment methods, giving customers flexibility at checkout. Card payments can be processed in various ways, including swiping, tapping, or inserting a chip. If Shopify Payments is not used, an external card reader can handle transactions. Manual entry is also available for situations where a physical card cannot be processed.

Cash payments remain a common choice, and Shopify POS helps track cash flow by calculating change and monitoring the amount in the cash drawer. Cash payment settings can be adjusted in the Payment Types menu, and specific hardware is supported for cash handling.

Gift cards provide another option, letting customers share store credit with others. Shopify POS allows businesses to sell and redeem gift cards in person, and these can be used both in-store and online.

For customers who cannot pay the full amount at once, Shopify POS supports partial payments. Orders can be saved, and the remaining balance can be collected later using any accepted payment method.

Managing orders, refunds, and exchanges

Shopify POS keeps track of orders across different sales channels, making it easier to manage purchases made in-store and online. Staff can access order details, update fulfillment status, and resend receipts when needed. How does Shopify POS work when modifying an order? Changes, such as adding or removing items, can be made before completing a transaction.

A smooth returns and exchange process is also essential, with 76% of customers stating that a good returns policy influences their online purchase decisions, according to a survey by the NRF. Shopify POS simplifies this by automatically processing refunds and updating inventory when a product is returned. For exchanges, the system refunds the original purchase and creates a new sale within the same transaction. Additionally, gift receipts can be issued, allowing returns without revealing the purchase price.

Orders that require shipping can be managed directly from Shopify POS. Customers can choose to have their items sent to an address instead of carrying them out of the store. Tracking details and delivery updates are recorded, keeping everything in one place for reference.

Receipt management

Receipts serve as a record of a customer’s purchase and payment details. How does Shopify POS work when issuing receipts? The system provides multiple options, including printing them, sending them by email, or delivering them through text messages.

When using more than one receipt printer, a default printer can be assigned to each POS device. This allows for better organization and ensures receipts are printed at the correct station.

The appearance of receipts can be adjusted to include store location, customer details, or order notes. Customizing this information helps maintain a consistent brand image and provides customers with useful details about their purchase.

Point of Sale staff management

How does Shopify POS work when managing staff access? Staff permissions control what employees can do within the system, ensuring they only perform tasks relevant to their role. Access is managed in the “Users and permissions” section of Shopify admin under Settings. Selecting the “Give Point of Sale access to this staff” option enables team members to use the system.

Logging in requires a Shopify ID or login credentials. If staff members do not have the necessary permissions, they can only enter with a PIN after an authorized user has signed in first. Different permission levels can be assigned using POS roles. Each role specifies what actions an employee can take within the system, ensuring responsibilities align with their position in the store.

Discount management

Discounts can be applied in Shopify POS once items are added to the cart. They can be set for individual products or the entire purchase.

Stores using a POS Pro subscription with an iOS or Android device at checkout can apply automatic discounts assigned to specific locations.

Staff must have the necessary permissions to apply custom discounts or enter discount codes. These settings determine who can adjust pricing at checkout.

How To Set Up and Use A Shopify POS System

Setting up Shopify POS allows you to manage sales efficiently. Follow these steps to get started.

• Choose a Subscription Plan: Select the right subscription level for each store location. In Shopify admin → Point of Sale → Locations, go to Manage subscriptions, pick a plan, and save your settings. Confirm by clicking Approve subscription.
• Download and Set Up the Shopify POS App: Install the Shopify POS app on your preferred device, log in, and configure basic settings. Spend some time navigating the different screens and features before adding products to familiarize yourself with the system.
• Add and Organize Products: Add products in Shopify admin → Products → All products. Click Add product, enter details, set availability to Point of Sale, and upload images for better organization. If managing a large inventory, create collections to categorize products efficiently.
• Set Up Taxes: Taxes are applied based on store location. In Shopify admin → Settings → Taxes, choose the appropriate tax region and set the rates. U.S. users can enable automatic tax settings, while others need to specify country and region rates manually. Ensure the store’s location is added and linked to the POS device.
• Configure Payment Methods: Enable Shopify Payments for a built-in solution that avoids extra transaction fees. If opting for a third-party payment provider, ensure that your subscription is at least a Shopify plan or higher.
• Connect POS Hardware: Set up card readers, receipt printers, cash drawers, and other POS hardware using the provided instructions. If using non-Shopify hardware, refer to the manufacturer’s manual for setup details.
• Run Test Transactions: Before going live, test different transaction types, such as processing partial payments, issuing refunds, marking orders as fulfilled, and updating transactions. This ensures everything functions smoothly when making actual sales.

ConnectPOS – An ideal POS system for Shopify

Among top POS systems for Shopify, ConnectPOS stands out as a user-friendly POS app designed for businesses operating physical stores or pop-up shops. It synchronizes in-store and online transactions in real time while seamlessly connecting with Shopify, ensuring smoother and more reliable business operations.

Key Capabilities:

• With automatic data syncing, you can manage inventory across locations without manual updates.
• Whether using a desktop, Android, or iOS device, this POS system provides flexibility to suit different business needs.
• By supporting self-checkout through a PWA mobile app and kiosk, it allows customers to complete purchases with ease.
• From e-invoicing and custom orders to split payments and booking, this system adapts to various retail requirements.
• Here is a POS system that aligns with specific industry and regional demands, making it adaptable to diverse business models.
• It integrates smoothly with third-party solutions like ERP, CRM, and accounting software, allowing businesses to maintain operational consistency.
• With multi-language support and microservice technology, Shopify merchants worldwide can expand their reach effortlessly.

Advantages & Limitations:

Advantages

• A straightforward interface simplifies transactions for store staff and managers alike.
• From inventory control to sales tracking, real-time updates keep business insights accurate and reliable.
• Whether managing one store or a retail chain, centralized data access allows for better decision-making.
• By organizing customer information effectively, businesses can personalize interactions and improve loyalty programs.
• With order accuracy being paramount, this system ensures smooth checkout and transaction handling.

Limitations

• A learning curve exists for those new to POS systems.
• Initial setup may require technical support.
• There is no hardware provided.

Pricing Plans:

Here are the pricing options to suit different business scales:

• Free trial available for new users.
• Standard: $49/month.
• Advance: $79/month.
• Premium: $99/month.

This Shopify POS system delivers a strong foundation for modern retail success, from real-time inventory tracking to customer data management. Whether running a small shop or expanding across multiple locations, businesses can rely on ConnectPOS to keep operations running smoothly.

FAQs – How does Shopify POS work​

How does Shopify POS work for the payment process?

By linking with Shopify Payments or third-party providers, businesses can accept credit cards, digital wallets, and cash. Payment processing is integrated within the Shopify admin for easy tracking.

Does Shopify POS sync with online inventory?

Yes, real-time inventory updates ensure stock levels remain consistent across physical and online stores, preventing overselling or stock discrepancies.

Can I use Shopify POS on multiple devices?

You can use an iPad, iPhone, or Android device, Shopify POS works across different platforms, making it accessible for various retail setups.

Conclusion

Now you’ve got the answer to “How does Shopify POS work?” With real-time inventory updates, automated order handling, and flexible receipt options, Shopify POS simplifies retail operations and enhances customer experience. It streamlines processes, reduces manual workload, and helps businesses stay organized while scaling effectively. Understanding its features allows retailers to optimize performance and drive growth.

For an even more tailored and advanced POS solution, consider ConnectPOS. With robust features, seamless Shopify integration, and industry-specific customization, it empowers merchants to manage operations effortlessly. Contact us to explore ConnectPOS today and take your retail business to the next level!