has developed a new point of sale terminal and restaurant management system it intends to offer for free to help clients handle online food orders.

San Francisco-based manages an online restaurant marketplace for placing carryout or delivery orders. The company anticipates a surge in online orders stemming from its partnership with restaurant review site Yelp, which agreed to include links to when reviewing a restaurant that uses Eat24's services.

Another problem: "Restaurant owners kept asking us for help in dealing with their online orders, but the terminal manufacturers would not take our software," says Amir Eisenstein, Eat24's co-founder and chief marketing officer.

"I am not sure why they said no, other than maybe technical reasons or maybe egos," he says.

Eat24 is testing its new terminals in about 10 restaurants in the San Francisco area and plans to roll out the product nationally to its 25,000 restaurants by the end of the year.

Online food delivery orders will be fed directly into the Yes!POS terminal at the restaurant, Eisenstein says.

In addition, Yes!POS provides restaurant owners with a GPS system for delivery personnel as well as tools for tracking and scheduling deliveries, updating menus and prices, making table reservations, ordering supplies and scheduling employees.

"Restaurants are the heart and soul of our business," Eisenstein says. "We operated our own restaurants and we know exactly what a restaurant owner has to deal with."

The majority of clients are "mom and pop" small restaurants, Eisenstein says. "Some may need this new terminal to replace an old one, while others may take it to add on to their current system."

The terminals do not hold customer payment card data, Eisenstein says. "The customer information moves on to the authorizing bank or processor and does not stay in the terminal," he adds.

The system, which will be able to accept EMV smart cards in the future, supports all major payment processors, including PayPal, Eisenstein says.

"Right now, we are testing two different processing options in Heartland and PayPal, but we are also checking other options," he adds. "The bottom line is that we try to help restaurants get the best deal."

Providing the hardware and software for free should help Eat24 earn revenue, since the company gets paid only when its client makes a sale through its service, Eisenstein says.

Eat24 has "clearly developed a very different niche" by adding a POS terminal, says industry analyst Todd Ablowitz, president of Centennial, Colo.-based Double Diamond Group, LLC.

Eat24's agreement with Yelp and development of its own technology falls in line with a growing trend of integration in payments, Ablowitz says.

"Many vertical markets are becoming integrated, and we're seeing it in payments," Ablowitz says. "The result is simplicity for any point of sale solution."

Independent sales organizations that sell [traditional] card terminals should watch the development of Eat24's project closely, Ablowitz adds.

"ISOs are really tied into the restaurant business, and they may find themselves wanting to learn more about this process," he says.

Subscribe Now

Authoritative analysis and perspective for every segment of the payments industry

14-Day Free Trial

Authoritative analysis and perspective for every segment of the industry