Retailers need several tools to run their operations properly. And all these tools need to work together without hassle.
For example, when you sell something, your POS system records the purchase, but also needs to update your inventory and save information about the customer.
When all these tools are connected in one system, your work gets easier, and you can provide better shopping experiences. Here’s how to make the most of retail software.
What is retail software?
Retail software assists with the typical processes of owning and operating a retail business, including inventory management, accepting in-person payments, tracking sales, and managing customer data.
Before computers and the internet, companies performed these tasks separately and manually, entering sales numbers into ledgers, writing out and mailing order slips, and using punch clocks to manage employee schedules. Retail software streamlines many of these processes, providing a centralized system to reduce human error and improve efficiency.
Today, retail software solutions range from point-of-sale (POS) systems to comprehensive retail management programs that integrate with other business applications. They can run on a tablet, smartphone, or computer.
The best retail software can do it all, creating a single source of truth for all the data related to your business—whether DTC, wholesale, B2B, online, or in person. Shopify POS, for example, integrates product, order, and customer information into a unified system, streamlining online and offline operations to help you run a smoother, more efficient business.
Benefits of using retail software
Retail software can streamline many different types of processes retail businesses require. Here are just a few of the ways they can give your business a leg up:
Offers higher efficiency and growth
Effective retail software helps you streamline retail operations while reducing Total Cost of Ownership (TCO). Unified ecommerce and POS channels without middleware can cut costs and boost staff productivity by centralizing operations and back-end processes.
In fact, EY’s POS Market report found that Shopify POS has a 22% better TCO than the market set surveyed. It also offered 20% faster deployment times thanks to cloud-based flexibility and an intuitive POS interface that speeds up retail staff training.
In a period of rapid growth, the ability to set up and control a storeʼs POS system with a single click was a game-changer. It allowed us to open 60 new locations in a year.
Better customer service
Retail software gives a complete view of every customer, from past purchases to support history, in one place. Service agents can instantly see what a customer bought online or in-store, check real-time inventory, and respond seamlessly across email, chat, or in person.
It also automates tedious messages like order confirmations and shipping updates, freeing your staff to focus on meaningful conversations that build customer loyalty.
Access to real-time data
Retail software can help to calculate up-to-the-minute sales, manage inventory, and record order data. It also improves inventory management by automatically tracking stock, generating purchase orders, and identifying slow-moving items. Real-time data can help reduce overstocking and minimize the risk of stockouts.
With Shopify's unified platform, you get a complete view of your business by combining all your product, order, and customer data in one place.
This single source of truth empowers you to make smarter decisions based on the full picture, from spotting buying trends to understanding customer preferences across online and in-store sales. No more piecing together fragmented data or missing out on insights that could help grow your business.
8 types of retail software
- Point-of-sale (POS) systems
- Payment processing software
- Customer relationship management (CRM) software
- Inventory management software
- Marketing automation software
- Ecommerce platforms
- Loyalty program
- Vendor management
Different types of retail software do different jobs. Here are some key features you may want to look for when choosing your application:
1. Point-of-sale (POS) systems
Point of sale (POS) systems handle all the processes of accepting in-person payments, functioning as the modern equivalent of a cash register. These systems cover the basics of calculating sales totals and producing receipts. However, more advanced systems like Shopify POS can include inventory management features, tracking customer behavior, and collecting customer data (i.e., emails and phone numbers) for future promotions and discounts.
The best POS software can integrate data from all your systems. While many require third-party integrations, Shopify can do it all right out of the box—delivering insights you can count on. Rather than relying on a series of disjointed platforms and integrations, Shopify unifies your ecommerce and retail data into a single command center, empowering retailers to run an efficient and successful business.
2. Payment processing software
Payment processing software manages and processes financial transactions. It typically integrates with a POS system or ecommerce platform. For example, Shopify POS comes with integrated payment processing from Shopify Payments. To remain flexible, look for payment processing software that’s effective in-person and online and keeps up with contactless and digital payment trends, such as tap-to-pay cards or mobile wallet apps.
3. Customer relationship management (CRM) software
Customer relationship management (CRM) software helps you manage interactions with customers and prospects. CRM software lets you do things like track customer purchasing behavior and send automated and personalized promotional material. Collecting customer data is critical for retention and engagement.
4. Inventory management software
Inventory management software helps retail businesses track what they’ve sold, what they have in stock, and what they need to order. It can automate processes, letting you expedite ordering, set low-stock thresholds for reorders, and schedule alerts for stockout or overstock scenarios.
Inventory management software can also compare up-to-date sourcing prices, which can help save you money during market fluctuations. With Shopify’s inventory management features, retailers can save 10+ hours on manual inventory management every month.
5. Marketing automation software
Marketing automation software like Shopify Flow automates marketing tasks and workflows, helping you to engage with customers and prospects. It can include email marketing, social media management, and lead-generation features.
Modern marketing software can use data to personalize marketing experiences for existing customers or develop target campaigns for new markets. Automated marketing software can provide feedback and analytics on the success of a campaign, including metrics such as key performance indicators (KPIs), returns on investment (ROIs), and the campaign’s effect on sales performance.
6. Ecommerce platforms
In a world where digital sales represent a crucial marker for most companies, ecommerce software like Shopify has made it easier for businesses to get in on their slice of the internet pie. They allow you to create a digital storefront with the features you need to sell your goods online and can include various tools, such as website design, shopping cart functionality, and payment processing.
Traditional ecommerce software is a standalone application. More advanced versions use modular architecture and application programming interfaces (APIs) to integrate with third-party systems, providing more flexibility and customization options.
7. Loyalty program
Loyalty program software is designed to reward and retain customers by offering incentives for purchases from and engagement with your brand. Shopify integrates with some of the top loyalty programs available, including Marsello and LoyaltyLion.
Loyalty program rewards can be points, discounts, and exclusive offers based on the program's parameters. Retailers can track customers’ loyalty participation across online and in-store channels.
For example, western-wear retailer Tecovas shows the power of integrated loyalty tracking in its mission to deliver "radical hospitality" across 30+ retail stores. Using POS UI extensions, store staff can access customers' loyalty information and purchase history at checkout.
Staff could provide personalized product recommendations and run effective upsell initiatives based on customer preferences and buying patterns. For Tecovas, integrating loyalty data into its POS system became a way to build long-term customer relationships and deliver the memorable shopping experiences the brand is known for.
8. Vendor management
Vendor management software streamlines the process of managing your suppliers, making it easier to organize inventory, track product sources, and evaluate supplier performance. Whether you produce your products in-house or source them from multiple suppliers, managing vendor information is essential for a smooth operation.
With Shopify POS, you can assign vendors to products directly in the Shopify admin. This allows you to sort and filter inventory by vendor, generate reports, and gain valuable insights into your supply chain. Advanced tools like Stocky offer even more control—including detailed supplier profiles and features to manage products from multiple suppliers.
5 key features to look for in retail software
Retail software offers many tools to help manage and streamline your operations. Here are a few notable features to look for:
Sales tracking and reporting
Real-time sales data is essential for accurate inventory management, effective accounting, and informed business strategy decisions based on current trends and customer demand. Accurate sales tracking ensures inventory levels are aligned with customer demand, helps identify trends, and provides insights to fine-tune your business strategies.
Inventory management and tracking
Over- or understocking inventory can result in unnecessary costs and financial losses. Solid inventory management software can help avoid this by ordering exactly what you need when you need it.
Advanced inventory management software does more than track stock levels—it automates reordering processes, sets low-stock alerts, and provides detailed insights into product performance.
Shopify updates inventory across all your sales channels in real-time, preventing costly overstock or stockouts. Unlike systems that rely on APIs to sync inventory data, Shopify’s natively unified platform ensures seamless communication between channels, avoiding the risks of miscommunication and data lag common in disjointed setups.
Customer management and engagement
Customers are your company’s lifeblood. Dedicated software can improve customer engagement and retention through automated marketing, data gathering, and analytics. Retail software also helps you improve customer relationships by streamlining other aspects of your operation, allowing more customer-facing time.
Automated marketing campaigns, personalized offers, and data-driven insights into buying behavior are key features to look for. Shopify integrates customer data from both online and offline sales, enabling a holistic understanding of customer preferences and behaviors.
Marketing and promotional tools
Personalized email campaigns, targeted promotional materials, and tailored customer loyalty programs are just a few ways retail software can strengthen your company’s marketing game.
Shopify has native marketing automation tools that allow you to create, execute, and analyze campaigns without the inefficiencies of relying on third-party platforms. By operating on a single system, Shopify allows retailers to create campaigns informed by unified, leading to higher ROI and better customer experiences.
Integration with other business systems
Look for software that easily integrates with your other systems—for example, POS platforms that connect with inventory management systems and ecommerce software that marries with payment processors. The more the different parts of your business talk to each other, the better off you’ll be.
Better yet, find a system that can do it all—one where you don’t need to rely on so many different platforms and integrations. Many retailers face challenges when they patch together disparate systems using APIs or middleware. While these solutions might appear to work on the surface, they often lead to data miscommunication, operational complexity, and higher long-term costs.
Shopify eliminates this risk with a natively unified platform, where ecommerce and POS solutions share a common data model. This allows flawless coordination between inventory management, payment processing, customer engagement, and sales reporting.
Top retail management software: Shopify POS
Shopify POS is a retail management system that is natively integrated with your Shopify ecommerce site. It provides a single source of truth for product, order, and customer data, helping merchants manage their entire business—inventory, sales, customers, orders, products, and more—from one platform. With mobile POS hardware, retailers can sell anywhere their customers are.
Plus, Shopify POS offers the lowest total cost of ownership (TCO), averaging 22% lower than surveyed market alternatives, making it the smart choice for retailers seeking unified commerce benefits. Businesses can test and expand to new channels with fully integrated solutions for ecommerce and wholesaling, while easily reaching new markets and countries.
Drive more sales and increase conversion with built-in omnichannel selling, endless aisle, and powerful clienteling tools. Retailers see an average of 9% revenue increase when using Shopify's Point of Sale for unified commerce, making it a proven solution for business growth and expansion.
Retail software FAQ
Can retail software integrate with other systems?
Yes. Many retail software applications can integrate with other parts of your business, including accounting software, employee management software, or marketing platforms. Integrating these aspects of your business can streamline operations, saving you time and money.
Is retail software typically suitable for businesses of all sizes or better suited for larger enterprises?
Retail software can be suitable for businesses of all sizes, not just larger enterprises. It can save time and improve accuracy, allowing you to focus on other areas of your operation. For example, a retail POS system can help expedite transactions and boost sales, giving you more time and resources to spend on product design. Ultimately, the suitability of retail software depends on your specific needs and requirements.
What is retail CRM software?
Customer relationship management (CRM) software is an application that collects customer data, such as purchase history, preferences, and personal information. CRM can be used for targeted marketing campaigns, to improve customer experience, or for new lead generation.
