John H. Patterson's problems with sticky-fingered store clerks were not unique. A Dayton saloonkeeper named James Ritty was having the same type of problem. In 1878, while on an ocean liner sailing to Europe, Ritty noticed a device that inspired him to invent the first cash register. Each time the ship's propeller rotated, a machine recorded it. Could something like this be made to record every cash transaction in his Dayton establishment? Upon his return home Ritty and his brother made such a device, which he patented in 1879 as "Ritty's Incorruptible Cashier." The first model operated by pressing a key which represented a specific amount of money. There was as yet no cash drawer. Ritty continued to improve on his invention, adding paper rolls to record the day's transactions in each price range. He opened a small factory at 10 South Main Street in Dayton to manufacture cash registers, while still operating his saloon. By 1882 the demands of all his enterprises had so overwhelmed him, however, that he completely sold out the cash register business to Jacob H. Eckert of Cincinnati, a china and glassware salesman who was very familiar with tavern and restaurant operations.

To raise money to enlarge the business Eckert in 1883 formed the National Manufacturing Company and moved to a larger building on East Third Street. 1883 was also the year that John Patterson entered the business of making cash registers. He had already purchased several for his stores and businesses in Coalton and Wellston, Ohio, and decided to invest in the National Manufacturing Company. By 1884, facing some financial setbacks in his coal and railroad investments, Patterson decided to buy the controlling interest in the new company, which he promptly renamed the National Cash Register Company. N.C.R. would be solely owned by members of the Patterson family until the 1920s, following the death of John H. Patterson in 1922.