diff --git a/src/lib/server/pos-service.test.ts b/src/lib/server/pos-service.test.ts
new file mode 100644
index 0000000..3a63655
--- /dev/null
+++ b/src/lib/server/pos-service.test.ts
@@ -0,0 +1,69 @@
+import { describe, it, expect, vi } from "vitest";
+import { listActiveStockCatalog } from "./pos-service";
+
+function stubPb(items: unknown[]) {
+  return {
+    collection: () => ({
+      getFullList: vi.fn().mockResolvedValue(items),
+      getList: vi.fn(),
+      getOne: vi.fn(),
+      create: vi.fn(),
+      update: vi.fn(),
+    }),
+  };
+}
+
+describe("listActiveStockCatalog", () => {
+  it("flattens stock_items rows, pulling the expanded category name", async () => {
+    const pb = stubPb([
+      {
+        id: "si1",
+        sku: "SKU-1",
+        name: "Widget",
+        description: "A widget",
+        unit: "ea",
+        current_qty: 12,
+        selling_price: 99.5,
+        cost_price: 50,
+        expand: { category: { name: "Hardware" } },
+      },
+      {
+        id: "si2",
+        sku: "SKU-2",
+        name: "Uncategorised thing",
+        description: "",
+        unit: "ea",
+        current_qty: 0,
+        selling_price: 10,
+        cost_price: 5,
+      },
+    ]);
+
+    const result = await listActiveStockCatalog(pb);
+
+    expect(result).toEqual([
+      {
+        id: "si1",
+        sku: "SKU-1",
+        name: "Widget",
+        description: "A widget",
+        unit: "ea",
+        category: "Hardware",
+        current_qty: 12,
+        selling_price: 99.5,
+        cost_price: 50,
+      },
+      {
+        id: "si2",
+        sku: "SKU-2",
+        name: "Uncategorised thing",
+        description: "",
+        unit: "ea",
+        category: "",
+        current_qty: 0,
+        selling_price: 10,
+        cost_price: 5,
+      },
+    ]);
+  });
+});
diff --git a/src/lib/server/pos-service.ts b/src/lib/server/pos-service.ts
new file mode 100644
index 0000000..6e8deab
--- /dev/null
+++ b/src/lib/server/pos-service.ts
@@ -0,0 +1,50 @@
+import type { PosCatalogItem, PosSale, PosSaleItem, StockItem } from "@/lib/types";
+
+/**
+ * PB client type kept loose so both the real `PocketBase` instance
+ * and test stubs satisfy the contract — same approach as
+ * `stock-items-service.ts`'s `StockItemsPb`.
+ */
+export type PosPb = {
+  collection: (name: string) => {
+    getFullList: <T = unknown>(opts?: Record<string, unknown>) => Promise<T[]>;
+    getList: <T = unknown>(
+      page: number,
+      perPage: number,
+      opts?: Record<string, unknown>,
+    ) => Promise<{ items: T[] }>;
+    getOne: <T = unknown>(id: string, opts?: Record<string, unknown>) => Promise<T>;
+    create: <T = unknown>(data: Record<string, unknown>) => Promise<T>;
+    update: <T = unknown>(id: string, data: Record<string, unknown>) => Promise<T>;
+  };
+};
+
+// ─── listActiveStockCatalog ────────────────────────────────────────
+
+type StockItemWithCategory = StockItem & {
+  expand?: { category?: { name?: string } };
+};
+
+/**
+ * Catalog source for the POS: active stock_items only, flattened so
+ * the frontend doesn't need to know about PB's relation/expand shape.
+ */
+export async function listActiveStockCatalog(pb: PosPb): Promise<PosCatalogItem[]> {
+  const items = await pb.collection("stock_items").getFullList<StockItemWithCategory>({
+    filter: "is_active = true",
+    sort: "name",
+    expand: "category",
+  });
+
+  return items.map((it) => ({
+    id: it.id,
+    sku: it.sku,
+    name: it.name,
+    description: it.description,
+    unit: it.unit,
+    category: it.expand?.category?.name || "",
+    current_qty: Number(it.current_qty ?? 0),
+    selling_price: Number(it.selling_price ?? 0),
+    cost_price: Number(it.cost_price ?? 0),
+  }));
+}