One of the most common ways to lose money in business is through cash handling mistakes. You and your employees work hard to increase profits, but if you keep letting cash handling mistakes cost you money, you will see your business’s profits slowly decline, and this is avoidable. Here are five common cash handling mistakes, and safeguards you can put in place to avoid them.
1. You don’t manage your cash in a timely manner.
You should be keeping track of your cash at every stage of the cash management process. This includes counting cash at the beginning of a shift, reconciling cash drawers at the end of each shift, and depositing your money at your financial institution in a timely manner. When you wait too long to count or deposit your cash, or you don’t have set procedures in place for when money should be counted, you risk a greater amount of mistakes slipping through.
It might seem like a hassle to pay your employees to come in early or stay late to count their cash, but at the end of the day, it will save you considerable money.
2. Your employees are not kept accountable for their cash.
When you let cash roll over from one employee’s shift to another, or you let your cashiers share registers, you are blurring the lines of responsibility. With an unorganized cash management system like this, it will become more difficult to identify mistakes and you won’t be able to tell who is responsible for the cash discrepancies. Your employees should be responsible for their own floats and registers, and no one else’s.
3. No one is really in charge.
Although each cashier should take responsibility of his or her own float, you should have a trusted manager assigned to every shift. This manager should be in charge of ensuring your cash handling policies are being used properly, and ensuring that all the employees’ counts are accurate. Random spot checks are an easy and efficient way to keep employees honest.
4. Your cashiers are using careless transaction practices.
When business is booming and your employees feel overwhelmed by customer transactions, they may feel the need to multitask by handling multiple transactions at once. When your cashier isn’t focused on the task at hand, it’s more likely that cash handling mistakes will occur: items can be scanned incorrectly or the wrong amount of change can be returned to the customer.
Staff should be trained to handle cash properly—one transaction at a time. If you see that your cashiers are too busy and are trying to cut corners to keep the line moving, consider adding an extra cashier or two to the floor. The additional cost will be worth it to ensure mistakes are avoided.
5. Your cash management system is outdated.
If your cashiers are still processing change with calculators, checking for counterfeit bills with the naked eye, or manually counting out their coins and bills at the end of the shift, the risk of cash handling mistakes increases. Handling business cash is quite different from handling personal cash—the quantity of cash is much greater, and it might be difficult for your cashiers to keep up with the counts. Automating your cash management system, buying bill counters and coin counters, and investing in counterfeit bill detectors can not only save your employees time but also reduce the risk of cash handling mistakes.
The Bottom Line
Cash handling mistakes are easily avoidable with proper procedures. Streamline the way cash is handled at your company and save yourself from costly losses.