Although most iPad POS companies offer service on a month-to-month basis, some have multi-year contracts. Before you sign a contract with any POS service, you want to read the contract in full and make sure you understand what terms and obligations you’re agreeing to. Pay particular attention to term length, all costs and fees, and the cancellation procedure, including any penalties, such as liquidated damages, for early cancellation. If the POS company will also provide your credit card processing service, you want to verify that you have the full contract (this is typically a three-part document: application, terms of service and program guide).
Leasing Contracts & “Free” POS Hardware
Whenever possible, you want to purchase your POS equipment upfront, as it can be significantly less expensive than leasing. It’s also better to buy than to accept “free” POS hardware or participate in a “free placement program” provided by your payment processing service so you can avoid being locked into the noncancelable contract that often accompanies such deals. These contracts are problematic because if your business closes, you’re personally responsible to fulfill all obligations.
Contracts can be as short as one year or as long as five, though most are for three years and automatically renew for additional one- or two-year terms. If you wish to cancel your account, you usually only have a 30-day window at the end of the term to submit written notice.
If you accept “free” POS hardware in exchange for signing a lengthy contract, you want to find out if you’ll own the equipment when the term ends, if you’re required to return it or if you must to pay more if you want to keep it. If you’re required to return it, you want to ask about wear-and-tear penalties and restocking fees.