The core difference
Square was built in 2009 by Jack Dorsey and Jim McKelvey to solve one problem: small businesses could not easily accept credit cards. A free card reader, a simple app, a flat transaction fee. That origin still shows. Square's default state is simple -- easy to set up, easy to train staff on, easy to extend with Square's own payroll, appointments, and online ordering add-ons.
Lightspeed started in Montreal in 2005 as a retail POS for brick-and-mortar stores, later expanding into restaurants and golf. It has always targeted businesses with real operational complexity: multiple product variants, supplier purchase orders, loyalty programs, and reporting that goes beyond "how much did we sell today." The interface takes longer to learn. The feature depth is the tradeoff you are making.
The pricing model reflects this. Square charges nothing monthly on the base plan and takes a cut of every transaction. For low-volume businesses, that is cheaper. For businesses processing $50,000+/month, Lightspeed's monthly software fee often comes out ahead -- and the features are substantially better at that scale.
"Square wins on simplicity and cost at low volume. Lightspeed wins on features and often cost at high volume. The crossover point is usually around $30,000-50,000 in monthly revenue."
Quick comparison: Lightspeed vs Square
| Feature | Lightspeed | Square |
|---|---|---|
| Starting price | ~$89/month (Retail Basic, billed annually) | Free plan available |
| Transaction fee | 2.6% + 10¢ (Lightspeed Payments) | 2.6% + 10¢ (card present) |
| Free hardware | No | Free magstripe reader included |
| Inventory management | Deep -- variants, bundles, purchase orders, suppliers | Basic -- adequate for simple catalogs |
| Multi-location | Strong -- cross-location stock transfers and reporting | Available -- simpler implementation |
| Restaurant features | Full-service -- floor plans, KDS, menu engineering | Good for QSR and cafes, lighter for full-service |
| E-commerce | Available -- unified retail + online inventory | Square Online -- solid for basic storefronts |
| Integrations | 250+ apps | Broad ecosystem -- payroll, appointments, invoices built in |
| Setup complexity | Moderate to high -- worth the investment at scale | Low -- operational same day |
| Best for | Mid-size retail, restaurants, multi-location businesses | Solo operators, food trucks, small retail, pop-ups |
Pricing: what you actually pay
Square's free plan is real. No monthly software fee, 2.6% + 10 cents per card-present transaction, free magstripe reader. For a business doing $5,000/month in sales, that is $130-140 in processing fees and nothing else. Square for Retail Plus at $29/month per location adds item variants, cost of goods tracking, and purchase orders -- the features small retailers hit first.
Volume crossover math: At $50,000/month in sales, Square's processing fees run approximately $1,300/month. Lightspeed at $89/month + 2.6% + 10¢ processing runs approximately $1,389/month -- nearly identical, but Lightspeed includes substantially better inventory and reporting at that volume. Above $100K/month the math favors Lightspeed if you negotiate rates. Confirm current pricing at lightspeedhq.com and squareup.com.
Lightspeed's base plan at ~$89/month covers one register, basic inventory, and standard reporting. Restaurant starts at ~$69/month. Higher tiers add more registers, advanced analytics, and loyalty programs. Most growing retailers land on the Standard or Advanced plan once they have real operational complexity to manage.
Lightspeed deep dive
Lightspeed's inventory is the reason most businesses switch from Square. You can manage product variants at the SKU level, set reorder points, create purchase orders directly to suppliers, receive inventory against those orders, and run reports on what sold, what did not, and what margin you made per item. For a clothing boutique with 200 styles in 5 sizes and 4 colors each, that is 4,000 SKUs to track. Square handles it. Lightspeed handles it faster and with less manual cleanup.
Multi-location management is where Lightspeed pulls ahead of most SMB competitors. You can see total inventory across all locations, transfer stock between stores, run location-specific or consolidated P&L reports, and set different pricing by location if needed. For a retailer with 3-5 stores, the time saved on inventory reconciliation alone often covers the monthly cost.
Lightspeed Restaurant has full-service features that Square Restaurant lacks: custom floor plan mapping, kitchen display system integration, split checks by seat, and menu modifiers with forced choices. For quick-service or counter-service, this is overkill. For full-service restaurants with servers and real table turns, it is necessary.
- Setup takes longer than Square. Plan 2-4 hours for initial configuration and staff training, more for complex catalogs.
- Monthly software fees are unavoidable. If your volume is too low to justify them, Lightspeed is the wrong choice.
- Customer support response times have drawn consistent criticism in reviews. Premium plans include better access.
- The interface has a steeper learning curve for new staff compared to Square.
Square deep dive
Square gets out of your way. Download the app, plug in the reader, add your items, and you are taking payments in 20 minutes. For pop-up markets, food trucks, service businesses that occasionally take card payments, and small retailers with simple catalogs, that matters more than any feature checklist. There is no implementation project, no onboarding call, no configuration specialist.
The Square ecosystem works well if you want one vendor for everything. Square Payroll, Square Appointments, Square Online, and Square Invoices all connect to the same dashboard. For a small business owner handling every role, that reduces the number of systems to manage. None of it is the deepest tool in its category, but it is coherent and the integrations are pre-built.
Square's hardware covers most retail and restaurant scenarios without a long-term commitment. The free magstripe reader handles basic swipes. The Square Reader for contactless and chip is $49. Square Stand turns an iPad into a full POS for $149. Square Terminal is a standalone device for $299. No hardware contract required.
- Inventory management hits real limits with complex catalogs. Serious variant tracking and purchase order workflows need Square for Retail Plus or a third-party integration.
- Reporting is functional but not deep. For margin analysis or multi-location consolidated reporting, you will outgrow it.
- Full-service restaurant features are lighter than Lightspeed or Toast. Works for simple operations, not for high-volume table service.
- Processing fees get expensive at high volume compared to flat-rate monthly plans.
"Square is where you start. Lightspeed is where you go when Square stops being enough. Most businesses know which situation they are in."
Who each platform is for
Choose Square when: You want to be operational immediately with no upfront cost. You have a simple catalog and low operational complexity. You want a single vendor for POS, payroll, and online orders. You are a food truck, pop-up, service business, or small retailer processing under $30,000/month.
Choose Lightspeed when: You have real inventory complexity, including many variants, supplier relationships, and purchase orders. You run 2+ locations and need consolidated reporting and stock transfers. You operate a full-service restaurant with table management and kitchen display requirements. Square's reporting and inventory have become a bottleneck.
The honest middle: A single-location retailer with a straightforward catalog and $15,000-30,000/month in sales can run on either platform. Square is cheaper and simpler. Lightspeed is more capable. The decision comes down to whether the feature gap matters enough to pay the monthly fee and put in the setup time.
The automation gap neither POS closes
Both platforms process payments and track sales. Neither one automatically connects to the rest of your business.
A sale in Square does not update your accounting software without a manual export or an integration you set up and maintain. A low-stock alert in Lightspeed does not send a purchase order to your supplier. A new customer's first purchase does not trigger a welcome email through your email marketing platform. A day's sales do not automatically reconcile against your bank feed in Xero or QuickBooks.
For any active retail or restaurant business, these are daily tasks. Each one is a few minutes of manual work or a fragile integration that breaks when either tool updates. Building the reliable connections between your POS, accounting software, inventory suppliers, and marketing tools is what Aplos AI does -- on top of whichever platform you already use.
Still manually exporting sales to your accounting software or sending purchase orders that your POS triggered? We build the automations that connect your POS to the rest of your business stack.
Get a Free Automation Audit →The verdict
Starting out or running a simple operation: Square. Free to start, operational same day, no monthly commitment. Use it until you hit the ceiling.
Mid-size retailer or full-service restaurant: Lightspeed. The inventory depth, multi-location support, and restaurant features are worth the monthly cost once your volume justifies it -- and they usually do by the time you are actively looking at alternatives.
Either way, neither platform connects to the rest of your business on its own. Sales still need to flow to accounting. Low stock still needs someone to reorder. New customers still need a follow-up. That cross-system layer is where the real time savings are.