As more fintechs compete on software, Toast makes hardware a priority

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Many technology developers yearn to invent the future of payments through software, but Toast is also reaching to the past by trying to perfect the hardware that surrounds the new digital tools.

Terminal provider Toast Inc. has spent three years working on the hardware design for its handheld device. The ToastGo and ToastKDS (kitchen display screen) have a broad range of payments acceptance and business management software, but designing the hardware was a task the Boston-based company decided to take on itself rather than rely on off-the-shelf tablets.

"We would have loved to use the hardware available out there for as long as we could, but it just wasn't good enough," said Steve Fredette, president and co-founder of Toast. "Many of those were too small and too expensive."

So Toast designed its own handheld POS device, customizing features around Android tablets.

"We're starting a little later than some others out there, but we were able to get on Android and it has been a good decision," Fredette said.

Toast built the ToastGo terminal with a 6-inch screen and the standard Android power button moved from the front to the side to provide more screen space. After discovering that the original handstrap on the device was difficult to put on, Toast had its manufacturer create a curve on the back of the device so that a hand can easily slip onto the back.

Knowing that a bustling restaurant environment can be hard on electronic devices, Toast tested the device for withstanding numerous drops or spills.

"We have a rubber gasket around the device and a thin seal on the EMV card reader at the top of the terminal so that water and other materials cannot get in there," Fredette said.

The device has a magnetic charging cable, to avoid potential damage to USB ports. The company also sets up charging ports capable of handling many devices at a time. Prior to that, Toast noticed some customers trying to use charging adapters for each tablet, with many plugged into the same power strip.

"We would just have this massive group of cables going at the same time," Fredette said. "Now we have just four charger docks that everything plugs into."

Slick hardware can be a determining factor for many customers, as the number of options for POS devices in fast-paced restaurant environments continues to grow.

This week, Square launched its Square for Restaurants POS system for front- and back-end services in a restaurant.

In addition, Verifone has engaged in various partnerships to distribute its Carbon and Engage terminals in the quick-service restaurant sector, while First Data has positioned its Clover POS as a system ideal for that environment as well.

"Building hardware yourself takes a long time," said Fredette, whose company has been in business five years. "We have been in beta about six months now, but we are launching and it is an exciting time because we have put a ton of stuff into it that is purpose-built for our customers."

Fredette didn't disclose the exact number of Toast clients, saying only that the company serves tens of thousands of restaurants. Both new and current customers are expressing an interest in the ToastGo terminal, he added.

ToastGo terminals communicate via WiFi to the ToastKDS, where waiters and kitchen staff can look at the same menu orders and alert each other when a meal is ready to serve, or if changes need to be made. It can also pull up the ingredients in the food or wine being served to provide information to diners with questions or food allergy concerns.

The system handles payment at the table and connects to a main Toast terminal in the restaurant and a printer for receipts for those choosing not to receive them via text or e-mail.

In addition to EMV and magstripe transactions, the ToastGo also reads QR code scans to accept coupons or restaurant loyalty programs. The software also allows diners to register for loyalty programs at the time of payment.

"Some restaurants were hesitant in the past to adopt new technology because they didn't think it was reliable enough or they were afraid it would get in the way of the customer interaction experience at the tables," Fredette said. "ToastGo solves all of those problems."

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