Square is growing its platform into a one-stop shop for retailers

Square Developer Platform illustration, courtesy of Square

Square, which is best known for its physical and digital payment solutions, is building out its product ecosystem to manage nearly all of the operational needs of retailers. The goal is allow retailers to be able to easily coordinate online and offline transactions, including orders, customer relationships, inventory and more, from within the Square family of products.

In August, the company rolled out its Orders API, a feature that allows sellers to manage fulfillment logistics from within the Square ecosystem. It’s part of a concerted effort to build out the Square Developer Platform to allow for sellers to manage a growing array of business functions from Square, including APIs that correspond to customer and employee management, inventory, catalogs and so on. The Orders API represents a major step along the centralization of retailers’ fulfillment operations across various platforms and devices, as well as online and offline channels.

“Square is one of the very few companies that can provide an end-to-end solution that facilitates sellers having that omnichannel experience for their entire business, whether it’s online, in person or mobile,” said Carl Perry, lead for the Square Developer Platform. “Before the Orders API, Square sellers would have relationships with DoorDash, PostMates [and others], and each of those services would have an application and tablet that they would have to manage.” With the new functions enabled through the Orders API, sellers can access all of the relevant data in one place, he noted.

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In addition, the APIs will integrate with external third-party systems that aren’t running on Square’s servers. “For example, a large retailer asked us if we had a solution for line busting — they had their own customer relationship management system, loyalty system, everything,” Perry said. “They were able put all the information from their inventory management product catalog and customer records into Square via our APIs,” he explained, pointing to the platform’s capability to serve large brands with complex needs.

Square’s Developer Platform enhancements are part of a wider effort to cater to merchants who want to effortlessly connect online and offline selling. In March, the company rolled out Square for Retail, a product that allows Square merchants to seamlessly integrate online and offline operations, including marketing and social selling by way of Instagram integration.

According to Andrew Lipsman, e-commerce and retail analyst at eMarketer, Square’s motivations for the ongoing evolution of its point-of-sale system are likely competition, as well as the necessity to add features to retain existing clients. “One context for this is [the growth of] Shopify, which has won over small businesses as a one-stop shop,” he said. “Square needs to support the small business community that started offline and is going online, while Shopify is doing the reverse — it’s an arms race.” Merchants are demanding holistic, integrated platforms for operations, payments and inventory, and this is a move to support these needs, he added. 

For Square, the growth of its Developer Platform represents the evolution of point-of-sale systems to focal points for retailers’ needs. “Clearly, we monetize payments processed on our API; that’s a massive opportunity,” said Perry.  “But the core of the platform story is that it makes it easier for sellers who may not use Square [to join its ecosystem] and provides a better set of solutions [for existing clients] so that they stay with Square and are happier.”