In Japan, An HR Conglomerate Uses Payments To Get A Foot In The Door

Small-business point-of-sale products can come from unexpected places — but from a Human Resources conglomerate based in Japan? That’s the improbably source for a rapidly growing POS product, according to Tech in Asia.

The $2 billion conglomerate is Recruit, a privately held Tokyo-based company whose overseas operations have until now nearly all been localized versions of its landmark HR service. But in 2013, Recruit subsidiary Recruit Lifestyle came up with the idea for a smartphone-based one-stop-shop product for small-and-medium sized business owners looking to manage their inventory and sales. Within a year, the product, dubbed AirRegi, gained more than 100,000 businesses, and the company is betting that it can find similar success outside Japan.

What makes AirRegi unusual is not just that it’s free — there’s not even a freemium version and AirRegi doesn’t take a cut of transaction fees — but that it’s specifically designed to do everything except the payments part of a small business. As a result, while Square, Coiney and similar startups focus on payment processing features and offer business management features as a sideline, AirRegi manages everything else — product orders, customer payments, sales records — and has partnered with Square Japan for payments, as well as integrating with small-business accounting software from Japanese software vendors Freee and MoneyForward.

AirRegi is also highly configurable — it can be customized for restaurants so staff can keep track of each table’s charges, for example — runs on both iOS and Android devices, and is now available in 134 countries.

Aside from price, one reason for AirRegi’s success could be that it started with a huge lack of knowledge — the company’s only engineers were people who had never used a POS register for business, according to executives. The development team had to start from scratch, visiting and interviewing store owners in order to understand how to construct the right user experience.

But unlike a startup, Recruit can afford to invest in an AirRegi ecosystem — one that lets the free POS system work as a foot-in-the-door product to keep bringing in partners like Square, who make AirRegi more attractive to small businesses, but also positions Recruit as an obvious place for those businesses to turn when they need recruitment or HR services.