In the Quick Service Restaurant (QSR) industry, where 99-cent menus drive billion-dollar revenues, every penny counts. But QSR's are fraught with inefficiencies. Think about it: each unused napkin or catsup packet that ends up in the trash, each bathroom break that takes an employee away from the cash register or fry station, or a snowstorm that keeps customers tucked in at home despite your “Open Late” guarantee. And each of those inefficiencies hits the bottom line through higher cost of goods, lost productivity or greater operating expenses.
For those responsible for managing the safety of each 99-cent transaction, there's no room for inefficiency. Yet despite innovations in product development and service delivery, cash handling models remain antiquated and labor intensive.
Chances are , your cash management system operates on one of two models: (1) the store manager is going to the bank at least once a day, (in most cases, twice) to make a deposit; or (2) you have armored car pick-up service. These options have been around forever despite persistent short-comings.
When shift managers are responsible for cash deposits, it requires a “field trip” to the bank, meaning time away from the shop and increased opportunity for theft or robberies both en-route and at the unsupervised store. There's also the temptation to add in a few personal errands on the way, and risk of injury that results in workers' compensation claims. Add to that the potential for reduced levels of customer service during manager absence, and the support for this model is weak, other than the fact that it is cheap (if you don't account for related loss, workers compensation or lost productivity).
In comparison, traditional armored car service has long been recognized as a better option to secure a store's funds. Armored car service translates into increased manager presence, fewer accident claims, reduced risk of theft, less attrition, and of course, significantly higher fees — the cost of securing your cash.
But experience demonstrates that it is not uncommon for deposits to be shorted; by the time the deposit has been transported, sorted, counted and placed at the bank, any discrepancies are difficult to rectify and resolve. In some cases, this is due to banking errors, but more commonly, deposit shortages are due to internal theft. The time that supervisors spend investigating these shortages can be frustrating, and they often end without a satisfactory resolution.
Innovation was long overdue.
Identifying the Problem
As director of loss prevention and security for Wendy's International, it was my job to work with the Wendy's operations team to analyze and improve the existing cash management system. Because the Wendy's team was looking for ways to reduce margins and extract labor from stores, it was an ideal time to explore new options.
Traditional armored car programs were not viable because they didn't deliver the ROI, they simply added an operating expense on the store's profit and loss (P&L), which operators did not want.
A labor study revealed that Wendy's managers were spending more than 27 hours per week on cash-related activities, which included counting and verifying the store's till at least three times a day. In most cases, this involved a time-consuming count of all bills and coins, with cash registers being recounted. While cash counters are used within the Wendy's system, the time that managers spent on this process was not only a waste of a valuable resource, but also stressful and often involved recounting due to errors.
Restaurant managers specialize in providing great food and great service, and they perform this function exceptionally well; however, many of them are just not comfortable handling cash and find this task one of their most difficult. What solutions exist where we could eliminate much of the stress related to the cash handling process within our stores? Streamlining this process was long overdue, we decided.