How Smoothie King’s King-Size iPad Play Could Open the Gates for Tablet POS

In what appears to be the largest tablet-based point-of-sale deployment yet, the entire 700-store Smoothie King Franchises Inc. chain will convert to a system from San Francisco-based Revel Systems Inc. The Covington, La.-based chain, which sells blended drinks, snacks, and supplements, is replacing existing checkout registers with Apple iPads linked to card readers, cash drawers, and receipt printers in an installation expected to be completed over the next 12 months.

The chain competes with Jamba Juice, which has worked with PayPal Inc. on point-of-sale initiatives, including an order-ahead service.

Lisa Falzone, cofounder and chief executive of 4-year-old Revel, tells Digital Transactions News that Smoothie King’s multimillion-dollar decision, which includes both U.S. and overseas outlets, could trigger similar moves from other large chains that have been looking for rivals to make the first move. “Everyone has been waiting for this,” she says. “They all hate their point of sale.”

If that proves to be the case, it will likely benefit a number of companies that have emerged since the introduction of the iPad in 2010 to take advantage of the device for in-store checkouts. While many early tablet POS adopters have been small restaurants and stores, Revel in particular has been working to push the technology into larger merchants. One of its biggest clients is the Popeye’s fried-chicken chain.

The chainwide move by Smoothie King is “validating [tablets] as a trend that can handle larger and larger merchants,” says Rick Oglesby, senior analyst at Centennial, Colo.-based consultancy Double Diamond Group. For Revel in particular, the deployment “shows they’re able to push the envelope” on merchant size and outlet count.

Smoothie King is clearly looking not only for a streamlined checkout but also for a better experience for customers. The 41-year-old chain is looking to “improve our guest experience in-store as well as our operational visibility as a whole,” said Wan Kim, chief executive and owner of the company, in a statement. “With this system, we’re providing our franchisees with a small in-store footprint that is able to better serve our guests not only now, but well into the future.”

The company is primarily concerned with security and flexibility at the point of sale, according to John Lapeyrouse, vice president of information technology. A high priority is the ability to integrate new applications as they emerge, he tells Digital Transactions News. “It's impossible to know who's going to win in the loyalty wars and the payments wars,” he says. “But our customers will figure it out and they'll tell us.”

For its part, Revel is also counting on the deployment to validate the idea of cloud-based checkout, Falzone says. So-called legacy systems, involving conventional cash registers with built-in or linked card readers, “haven’t really changed in 25 years,” she says, leading merchants to investigate alternatives like tablet POS that, among other attributes, make it easier to train cashiers.

Merchants won’t convert quickly. “It’s not a decision people take lightly,” Falzone says. “It’s the central nervous system of their business. It runs everything.”

And while tablet POS may have a number of advantages, it’s far from free, as Smoothie King’s investment shows. Lapeyrouse won't disclose the chain's total cost for the new system, but estimates there are 2.6 checkouts per store on average. Revel’s price is $3,500 per terminal. In addition, Revel charges a monthly fee ranging from $99 to $199 per store, depending on the number of terminals, though this includes access to business-management tools.

Still, the Smoothie King deployment will turn some heads, especially among merchants with the same number of stores or fewer, Oglesby says. “It gives [Revel] credibility,” he notes. “The first thing a merchant is going to do if he’s on the fence is look to other merchants [using the system]. The first thing I want to know is, can you handle my stuff? It helps to know they can handle someone bigger than you are.”

Falzone adds that the big deployment should also dispel what she sees as a myth about tablets’ inability to stand up to day-to-day usage in busy stores. “This is proving all that wrong, that [it’s] not robust enough, the hardware and software at high volumes,” she says.