Point of Sale Software Developers
Business for Sale Industry Economics
2002 - 2020
2020 - 2026
The Point of Sale Software Developers industry, which facilitates sales of goods and services, has experienced strong growth over the five years to 2020. During the period, total industry revenue is anticipated to increase at an annualized rate of 12.2% to reach $2.8 billion, including 9.8% growth in 2020 alone.
Industry operators have benefited from a growing reliance on computers in downstream markets, including retailers, wholesalers, and hospitality and foodservice businesses, among others. The emergence and adoption of new technologies and the changing retail landscape have also benefited revenue growth.
Trends such as near-field communications (NFC), self-checkout counters, sensors, data analytics, and the integration of point of sale (POS) systems with back-end software systems have provided the industry with a platform for robust growth.
Furthermore, new software applications and hardware devices have enabled small operators to more easily afford POS systems that provide similar functionality to large and expensive terminals.
Over the past five years to 2020, operators in the Point of Sale Software Developers industry have benefited from increased adoption among wholesalers and renewed demand from retailers, restaurants, and hotels. Point of sale (POS) software helps manage and facilitate sales at the physical location goods and services are sold.
The function of the software differs from market to market. For example, retailers and wholesalers use POS software to keep track of inventory, while hotels and restaurants use the industry’s products to manage reservations.
POS software also helps stores interact with customers in a more efficient and personal way.
Revenue for the Point of Sale Software Developers industry is expected to continue growing over the next five years to 2025, albeit at a slower rate, increasing an annualized 5.2% to $3.6 billion.
Industry operators will benefit from technological advancements in computing and programming, which will create new opportunities for software that integrates point of sale (POS) systems with back-office systems.
These improved software programs will include the capacity to incorporate customized data analytics, mobile platforms and sensors, as well as generate consumer behavior insights.
Furthermore, a rising number of businesses, coupled with greater per capita disposable income and consumer spending levels, will increase the industry’s pool of potential clients and boost revenue.
However, it is expected that industry growth will decelerate sharply compared with the previous period as the number of new businesses in the United States is expected to slow.
Moreover, research estimates that growth in private investment in computers and software and the percentage of services conducted online will slow as well.
As these key indicators rise at slower rates, new revenue opportunities are expected to emerge at a more moderate rate than over the past five years.
This industry develops point-of-sale (POS) software, which manages and facilitates sales at the physical location goods are sold.
POS software varies significantly depending on the type of business using it and can provide extended features such as sales analysis and history, appointment scheduling and inventory management.
The intensity of capital expenditure regarding the point of sale software industry is low and for every $1.00 invested, $0.04 is spent on labor. Limited capital goods like server machines and office space are required by most software enterprises.
In most aspects, the software itself may be seen as an intangible product, yet it takes skilled individuals a lot of time to produce outstanding software. Many developer hours go into building software and the same effort goes into selling them effectively.
Companies in this business seldom encode their software and usually choose to outsource it. This wasn’t so in the past. The industry spends on average more than 40% of its income on compensation for employees as well.
Relative to employees, large corporations employ hundreds of people to create industry software and demand far more office space than smaller competitors but all that may be changing since the Covid-19 Pandemic.
The Retail Point of Sale over the five years leading up to 2020, the Software Developers industry has had considerable revenue volatility, which is anticipated to continue. Because software sold to companies accounts for the majority of industry income, it is subject to the business cycle.
Businesses are eager to invest in software to improve productivity and business operations in times of increased corporate profit and company confidence. Most firms, on the other hand, consider software to be a capital cost or a purchase that can be postponed amid a downturn in demand.
However, huge technical advancements in the business have prompted corporations to invest in industrial software during the last five years.