3 Ways Your POS Helps Identify Employee Theft

Employee theft is an unfortunate reality of the bar and restaurant industry, but you can use your point of sale (POS) system to combat this form of shrinkage — which by some accounts is responsible for a 4 percent loss of annual sales. Get serious about taking on theft and shrinkage, and discover three ways a POS solution can help you identify and respond to red flags that indicate your business may be a victim of employee theft.

Red Flag #1: Comps and Voids

One of the more glaring signs of employee theft is restaurant workers who have a high number of comped items, voided transactions, and refunds during their shifts. You can review POS data to identify transactions in which no sale actually took place and determine if something fishy is going on. Workers may be tempted to “sweetheart” certain items for friends and family, offering food and beverage freebies or deep discounts that they have no authorization to distribute.

You might consider enforcing stricter controls over the “no sale” button on your cash register, which limits employee access to the cash drawer when there isn’t a transaction taking place. Many restaurants and bars also integrate video recording with their POS to monitor employee activity so there’s concrete proof if workers are stealing. You can set your video system to record based on certain types of suspicious activity. Using video can also be an effective preemptive strike: when workers know they’re being monitored, they’re much less likely to risk their job by committing a crime.

Red Flag #2: Increasing Ingredient Expenses

Lobster, champagne, and filet mignon will always cost a pretty penny, but have you noticed the amount of money you’re spending on liquor and other ingredients is inexplicably rising over time? Chances are employee theft is the culprit. Workers often see skimming food or a seemingly small item like a piece of fruit as a relatively harmless offense, but the costs for your business add up incrementally and eat into your profits.

To address this problem, take a few hours each week to review your POS-integrated inventory management system, which will help you to keep tabs on pricey ingredients and items that may be vulnerable to employee theft. When you know what your averages are, it will be easy to spot irregularities in inventory counts and solve any problems before they snowball. Reviewing employee log-in data alongside your inventory system can reveal instances of bar staff over pouring or serving drinks “on the house” without the proper clearance to do so.

Red Flag #3: When the Reporting Isn’t Right

Sometimes, something just doesn’t add up. Is there a discrepancy between the total cash that the POS reports should be in a drawer at the close of shift and what’s actually there? Or maybe the inventory report says you have a dozen steaks on hand when you only count seven? Inconsistencies between your POS reports and your manual counts may be a sign of employee theft.

Some POS systems linked with video recording can superimpose the text of each customer order over the video of the transaction. This way, you have an easy, hard-to-argue way to see if employee theft accounts for the POS discrepancies or if something else is going on.

Your POS system is a useful tool for remedying the “sticky fingers” phenomenon that’s all too common in hospitality. Take advantage of your POS’s robust features and capabilities to end employee theft and turn your profits around.