track your cash!! - part I

Hello Folks - sorry for the brief sojourn.  I'm in the midst of building out a new bakery for my coffeehouse, and developing new software to better manage my catering business... .so I've been a bit busy!

But enough of my stuff - I received a request to write about about managing your cash, and how to do this to ensure you are not losing cash as it makes it way from the customer's hand to your bank account.  So - here is the first segment!  

As any small business owner who deal s with cash knows - you must be very very careful with your cash and have excellent tracking systems in place to ensure your cash does not go missing.    So, this coffeehouse guy segment will look into cash tracking strategies, and how to implement them.

The basic idea behind cash tracking is to track the cash from the transaction (where the customer gives you the cash) all the way to the bank, and make sure there are systems in place to alert you to when something is amiss.

There are three basic places to track the cash:  From the customer to the cash register, from the cash register to the safe, then the safe to the bank.    If your system is working correctly, you should be able to track every cent of your money all the way to the bank.

Part I - tracking money from the customer to the cash register.

There are several components of this part:  initial cash bag, single person responsibility & combining cash with other payment systems.   

The initial cash bag should ALWAYS contain the same amount of money.  In my case, I have $100 in $1.00 bills, $100 in $5.00 bills, $150 in $10.00 bills, $30 in quarters, $20 in dimes and $10 in nickels  (I dont use pennies - i have all my prices rounded out to the nearest 5 cent).    Thus, every cash bag starts with $410 in change.  

Second, responsibility should always boil down ONE person.  My shift leaders are taught that the cash register (and the money therein) is *specifically* their responsibility.  Not the Barista, not the second Barista - just them.  When the shift leader starts their shift, they *count* the money going into the register to ensure they are starting with *exactly* $410.  If the register comes up short, there is ONE and ONLY ONE person that can be held accountable for any missing cash - the Shift Leader. 

Third, a use a new cash bag for each shift.   I have two shift leader shifts per day, thus two cash bags are used per day.  At the end of a shift leaders shift, they z-out the register (a z-out prints off a summary of all transactions that were run through the register during that shift, and it *clears* the register of all transactions for the next shift), z-out the credit card machine, and z-out the gift card machine.   

Fourth, the shift leader should NEVER count their own cash bag.  At the end of their shift, they should just pull ALL the cash (and change) out of the cash register, along with the z-out of the cash register, the credit card machine and the gift card machine, and put them all in the cash bag... and drop the cash bag in the drop slot of the safe. 

Fifth: Reconciliation.  You will need a spreadsheet that you can enter all the information into from the shift that will reconcile all the cash. 

This is an example of a daily sales sheet we use. 

#1  start off by adding in the z-out.  This is the sales for the shift recorded on the cash register.  Now, if you ONLY accepted cash, then this would indicate exactly how much cash there should have been in the register (minus the amount you started with).  However, there are multiple ways people can pay for your product, including credit cards, gift cards and other forms of payment.   This affects the amount of cash you are left with in the register.  For example (see above #3)  If  the total sales for the shift were $1005.40, and $524.95 of those sales were in credit cards, then you should expect to have $480.45 in cash (subtracting off the amount you started with).   

#2   In addition to credit cards you must figure out the NET impact of the gift cards.  SO,  if your customers use $100 on their gift cards, and only refill their collective cards by $50, then you must reduce the 'Z-Out' by$50.  In this case, in the first shift, the customers used their gift cards to purchase $45.40 worth of product, and refilled their cards with $25.70.  Thus, the 'net' impact of that shift on the 'z-out' was $19.70.

 

#3  As mentioned in #1 - you must reduce the Z amount by the amount paid by credit card.

#4 This is where you input the cash in the cash bag.  The spreadsheet is designed to add it all up to tell you how much cash was in the bag, then subtract off the amount you started with.

#5 - These are the final numbers.  It starts off with the amount of cash in the cash bag, subtracts off the amount the bag started with, subtracts off the amount paid with credit card, adjusts for the net amount from gift cards then compares it against the original z-out receipt to see how far off it is.    My rule of thumb - if the amount is less than 5 dollars off, then I let it be.  More than that, I go and talk with the shift leader to find out what was going on.

Well, that is enough for now - in my next segment, I'll write the Step II about managing cash from the customer to the bank account.

thanks!

Duncan

the Coffeehouse Guy