The Canadian dollar has taken a beating in the first months of 2014, and it’s not expected to recover any time soon. Whether that’s a good or bad thing depends on what business you’re in. For retailers, it’s a mixed bag. A lower Canadian dollar means shoppers are more likely to shop at home rather than crossing the border to the U.S. That means more traffic and higher sales for Canadian retailers. On the other hand, it means sourcing merchandise from the U.S. and other countries becomes more expensive.
Retailers usually respond to higher costs by raising prices, but cost-conscious consumers who are still feeling the effects of a weak economy are likely to be resistant to higher prices. That means that cost control will need to be a big focus of Canadian retailers. If you can’t raise prices and aren’t willing to sacrifice profit margin, you have to cut costs. Retailers often find their best opportunities are in the areas of labour and loss prevention. One solution is automating your cash handling procedures. Here are some ways automation can help you control costs in both labour and lost prevention:
Reducing labour costs doesn’t have to mean letting employees go. Another way to reduce labour costs is by reducing the time your employees spend on things that don’t add to the bottom line. Those activities include:
Counting cash drawers
Making change and refilling cash drawers
Collecting cash when the drawers are full or have too many large bills
“Shrink” refers to any loss of goods or money, whether it’s done intentionally or happens by accident. Examples include:
Giving a customer too much change because of miscounting or bills sticking together
Losing bills, coins or checks
Miscounting during drawer reconciliation
Employees taking money from the register
Robberies when there are large amounts of cash on the premises
Accepting counterfeit bills
How Automation Can Help
Automation can help you reduce costs in every step of the cash-management process:
Cash counters do the counting for you, eliminating errors and reducing the risk of employee theft by cutting down on the number of employees who handle the cash.
Cash recyclers also reduce both the amount of time spent dealing with cash and the number of people who have access to it. With cash recycling, cash taken in is immediately available for use, such as giving a customer change. It practically eliminates the need to empty and refill individual drawers during the day.
Counterfeit detectors: While most retailers train their employees on how to recognize counterfeit currency, people make mistakes, especially when there are long lines at the registers. Counterfeit detectors provide a backup to checks done by employees. In addition, being able to blame an automated counterfeit detector can reduce the pressure on employees who have to reject a customer’s bill.
Check scanners speed up the checkout process and reduce the risk of accepting fraudulent checks. They accomplish that by capturing vital information like the date, amount and signature as well as the bank routing and account numbers.
Currency fluctuations are tough on businesses. Not only do they affect both costs and sales, they impact planning, too. Most businesses place orders months in advance, and, when a currency is in flux, that becomes more of a gamble. What seems like a fantastic deal now might not look so great in six months, so that adds another layer of uncertainty to negotiations. Some big businesses have employees specifically dedicated to factoring potential currency fluctuations into vendor agreements, but most small businesses don’t have those resources.
One thing all businesses can do, though, is cut costs where they can, and everyday processes are a prime opportunity. Automating your cash management processes can help you control costs not only during uncertain economic times, but also when the Canadian dollar rebounds.