Test your assumptions: Take your cash handling to the next level
In the retail industry, cash handling can be just another cog in the wheel, needed to get money from the consumers' pockets to your business and back out again. As a result, it is easy to overlook the importance of this process - and just how much your business efficiency depends on it.
Jeff Hauser, market executive and retail market expert here at ARCA, said it best:
"One of the primary mistakes retailers make relative to cash handling is not testing assumptions," he explained. "Never assume to know the process used or cost of the process unless you've taken a deep dive into the process where the work is done - on the front lines!"
That means you don't want to sit back and assume your cash handling is efficient and effective. You do want to dive right into your business to identify areas that need improvement, as well as other ways to bolster your cash handling and streamline the process altogether.
Here is how to do that:
Identify your cash-handling methods
The first step toward improved cash handling is the identification phase. You need to locate every area affected by cash handling in your retail business, and then go from there.
This type of money management typically includes:
- Policies and procedures - Your business will have rules and regulations that govern who has access to cash, what to do with said cash and how to safely manage registers and other points of sale.
- Automated systems - Another key area involves your automated systems. These are the tools and technology you use for cash handling, like the registers themselves, your filing methods and your computers. These systems have to be up-to-speed for effective cash handling.
- Employees - Your employees are critical to cash handling. They have to be well-trained, educated and on-board with any policies, technology and other strategies you have in place.
Once this stage is complete, you can move on to more detailed steps.
How to improve cash handling
As you strive toward a more streamlined, efficient cash-handling process, follow these tips:
1. Research, research and research
As you begin, focus on what was emphasized by Hauser - testing your assumptions. You may come to realize that a system, tool or policy you thought was useful is actually costing you money. So, research, research and research some more. Analyze all of the areas in your business related to cash handling and look for inefficiencies. Talk to your employees as well, and learn the pros and cons from their perspectives.
2. Follow the money
The next step is to track your cash. Consider a scenario where you don't know who has access to your cash after point of sale. Where does it go? What could happen to it? You need to have systems in place - and controls - that limit access and beef up security. Otherwise, your business will be at greater risk of fraud, theft or other threats.
"Cash handling in retail keeps employees and customers safe, increases productivity and lowers operating costs," added Hauser.
With that said, learn where your money is going and monitor it closely every day.
"The right technology can greatly benefit your business."
3. Rely on automation
Automation in cash handling is your friend. The right technologies and procedures can simplify the entire process and remove that dreaded "human element." Example tools include computerized cash registers, cash recyclers, oversight and bookkeeping.
Not only will cash automation protect your business, but it can also save you money. Your employees will have more time to focus on other areas of the business.
"Cash automation in retail allows management staff and cashiers to refocus three-to-five hours per day, formerly spent counting cash, on superior customer service," noted Hauser.
4. Reduce cash on hand
Too much cash in your store is a risk - this is why banks limit the amount each teller can have at one time. The same should be done for your business. Implement company-wide rules that reduce the amount of money stored in each register and on-site safe. Not only will this limit possible losses from theft, but it will also make it easier for your employees to manage cash, perform accurate counts and close out at the end of the day.
All in all, never assume your cash handling is operating in peak form. Always test those assumptions and find ways to improve. Not only will this bolster safety and efficiency, but it will allow your employees to focus on what really matters - the customer.