The rise and fall of POS suppliers
This week I attended the launch of DPOS, the new Point of Sale system from Distribution Technology. As I watched an undeniably slick launch I couldn’t help pondering on the rise and fall of past suppliers in the POS market. Many will remember the companies that dominated this genre of systems in the 1990’s: Fame, Microlex, Intuitive, Crisp; none of whom are still trading today. Today’s market has its own successes – Focus are flying high on the back of recent deals with Barclays, St James Place, Irish Life and most significantly HSBC, N4 have had significant success with Nationwide and Intrinsic and again Barclays, while Crystal have increased in size substantially in the last couple of months through its success at L&G.
With such a buoyant market it’s no surprise to see the level of new entrants coming to market. Indeed as well as last week’s launch of DPOS, Vertex are launching Adviser Evolution and Focus are launching a new mortgage POS system, MPOS. In addition the traditional back office suppliers such as Quay and Intelliflo are enhancing their systems to address the front office, the sourcing engines such as Trigold and Mortgage Brain are strengthening their solutions, rumours abound about new entrants from overseas and the wrap suppliers are well positioned to look at this marketplace.
Will these solutions be any more sustainable than those from the POS suppliers of the past. The key to sustainability will ultimately be to have solutions designed correctly at the start and then kept to a single configurable code stream. Ultimately if each client demands its own code stream there is only so far any supplier can take the business model before it breaks. If the system is truly configurable, without substantial programming effort, then the company can then deliver on a lower cost base and implement a revenue model more biased to regular licence fees and less on lumpy services revenue. From what I have seen in the market place this is becoming more of a reality and the business model of many (but not all) of today’s suppliers is far more sustainable than those in the past.
Existing and new suppliers all have a tremendous opportunity as the market continues to be very active but they must gain both market momentum now before the market gets too crowded and insure the solutions are architected correct from the start if they are to realise this potential.
Written by Mark Loosmore - Visit Website