5 Ways Your Staff is Stealing From Your Restaurant or Bar
Employee theft is widespread in the workplace. Even when putting all your efforts into hiring responsible people, you are sure to encounter a few folks who think they're entitled to a discount or bonus. In the restaurant industry alone, employee theft totals between $3 and $6 billion dollars.
Opportunities for theft will depend on the operations and setup of your restaurant, but if you think like a thief you're more likely to recognize and prevent possible loopholes. Here are a few crafty ways that your staff could be stealing from you right now:
1. The Short Ring
This is a common occurrence in bars and nightclubs, but it's also possible in a quick-serve environment where cash transactions are being rung into the system near a cash drawer. Here's the scenario: On a busy night at the bar, a customer orders an $11 Grey Goose martini and pays for it in cash. The bartender takes the money for the top-shelf cocktail and puts it in the cash register, but rings it into the POS system as a $6 well vodka drink. The customer was charged the appropriate amount, so she doesn't know the difference. At the end of the night, the bartender pockets the difference between the cash drawer total and what the POS expects it to be. As the business owner, you'll notice when Grey Goose is flying off the shelves and the sales don't reflect the inventory, but by then it's probably too late.
Prevention
The best preventative measure for short ringing is to implement a blind closeout process. Blind closeout requires employees to reconcile cash at the end of their shift without notifying them of the exact amount they are expected to return. They have to count the cash and report the total to the system without knowing what it's “supposed” to be. If the bartender has been short ringing all night, it'd be nearly impossible for her to keep a running total in her head of what the computer thinks the sales should be at the end of the night. If she's able to remember the difference between the actual and the short rung total after hundreds of transactions, hire her as your accountant instead.
2. "Free" Food & Drink
For some people, a freezer full of filet mignon and decadent pre-made desserts is too much to resist. Even the "complimentary" bread at the server station can add up if your staff is snacking on it every day. Of course, alcohol is also a huge factor in inventory theft. In addition to drinking it or taking bottles for themselves, bartenders can throw in a drink (or four) on the house for their friends and favorite customers in an effort to increase tips.
Prevention
To start, lock the freezer and alcohol and only share the keys with a select few of your most trusted employees. That's an easy one. Also, consider an inventory management solution. The technology options are becoming increasingly accurate and robust (Toast's POS-integrated inventory management tool is piloting now!). To keep better tabs on comped alcoholic drinks, define and enforce a strict policy. Some examples include writing down every comp with an explanation or giving bartenders a dollar value limit on freebies. If you're still dealing with food theft, think about the root cause of the issue. Feed your staff before the shift. Consider occasionally serving the specials and high-end items to your staff to help offset the desire for dishes that would normally be way out of their price range.
3. Voids after Closeout
In an ideal world, you've hired a management staff that you trust completely. You've entrusted them with the keys to the building and the liquor cabinet, they're responsible for operations on the floor, and they're often the ones approving comps and voids in the system. Unfortunately, with this responsibility comes great opportunity for theft. Managers, alone in the restaurant at the end of the shift, have every opportunity to void out cash transactions that occurred during the day. The books balance out in the POS system and they can take the cash for themselves.
Prevention
Keep a very close eye on all voids, especially those made after close, and which manager is approving them. Your point-of-sale system should be able to track all of this for you and make it easy to see where theft may be occurring. You'll notice right away if one person is voiding transactions frequently and if they're doing it at odd hours.
4. Reusable Receipts
This scheme requires accuracy and a little bit of luck, but more than a few anonymous ex-bartenders I spoke with reported they saw this happening at their restaurant. A customer comes to the bar and orders a Bud Light, for example - a frequently requested beverage. The bartender prints the receipt and the customer pays in cash. Instead of closing out the tab, the bartender leaves it open. Fifteen minutes later, a different customer orders a Bud Light. Instead of entering it in the POS system as a separate check, the bartender reprints the first customer's receipt from the still-open tab. When the second customer pays for their beer, the original check is closed, leaving the cash from that first order unaccounted for and in the hands of the bartender.
Prevention
There are a few ways to make this more difficult for bartenders to pull off. Some restaurants require a receipt to be placed in front of the guests upon delivery of the drink, so every party should have a receipt in front of them at all times. That process can also improve efficiency because guests don't have to flag down the bartender for their checks. You can also use your POS data to your advantage. Keep an eye on the average time a tab is open at the bar and which servers are frequently reprinting receipts. Being aware of these sneaky tactics can help you sniff out anomalies in your business data.
5. Phony Walk-Out
A 2011 New York Post article reported that arrests for "Theft of Service" (aka: dine and dash, eat and run, chew and screw) increased 20% year-over-year. Dining and dashing is a slimy, rude, and ballsy move, but it happens. What's worse is that your servers can take advantage of that fact. At a busy time in the restaurant, servers can claim that a party (who, in reality, ate their meal and paid in cash) walked out without paying.
Prevention
The best way to prevent this scenario is to train yourself and your managers to be aware of everyone who leaves and enters the restaurant. Maybe you have a manager touch each table that sits down. When it's possible, relieve managers from tactical duties like food running and expediting so they can take a bigger-picture approach to the dining room. Of course, cameras in the restaurant are always an option and may be worth considering if you're seeing a problem with dine-and-dashers or with servers lying about it.
No matter what you do to arm your business against theft, there will always be ways that your staff can steal from the restaurant. So it's also important to recognize the roots of your staff's impulse to steal. If you can create a fulfilling work environment where employees feel a sense of ownership in their work, you'll decrease their desire to "stick it to the man." They'll be far less likely to behave recklessly if they are happy and feel fulfilled at work. Look closely at your payroll to ensure that wages match the duties expected. Consider treating your staff to a gourmet meal or offering a desirable discount for their friends and family (with limits, of course). Understanding the ways your employees can steal from you while also working to make your staff feel valued creates a strong wall of defense.
Kendal Peiguss is the Marketing Manager for Toast responsible for sponsorships, partnerships, and customer programs. After a brief stint as a server in a full-service restaurant, Kendal has found a passion for marketing technology that solves problems. She is also the assistant softball coach at Emerson College in Boston. Kendal on LinkedIn & Twitter.