Though credit and debit cards are the most common method of payment at both traditional and online retailers, many customers still prefer to pay with cash. Even though cash transactions dropped 16% worldwide in 2020, and 24% in the United States, McKinsey predicts a resurgence in cash payments in the wake of the changes brought on by the pandemic.
With the economy showing signs of improvement, more and more shoppers are willing to pay with cash. Merchants would do well to prioritize improving customer payment experience. But dealing with cash presents its own challenges. Problems with reporting and stockpiling might arise from having to handle cash, and the procedure itself is laborious.
But the most important questions to address are whether or not there are too many cash disparities and blunders that are harming your organization financially, and how much time personnel spend on cash-handling chores.
Since it’s quite unlikely that you’ll be able to tell whether or not your cash management is causing losses, it’s in your best interest to put in the effort to develop and implement a cash handling policy and acquire efficient checkout hardware and software. Here, you will find information that will tell you what to do.
Article Content-
- Principal Barriers to Better Cash Management
- What are the Key Elements of Cash Processing?
- Best Methods To Optimize the Cash Handling Process To Reduce Costs
- Purchase a good point-of-sale (POS) system
- FAQs
- Conclusion
Principal Barriers to Better Cash Management
Before learning how to create a successful cash-handling system, it is important to understand the potential causes of cash-handling problems. Your retail cash management will be significantly impacted by avoiding these issues. In the retail sector, there are often three common concerns that result in problems with cash handling:
1. Not exercising due diligence
Encouraging due diligence is one of the most crucial reasons to create cash handling procedures. Knowing where your money is, who has access to it, and how it will be utilized allows you to manage it effectively. You won’t be able to efficiently manage your accounting unless you have answers to these questions. You can also experience issues with cash flow, fraud, theft, and errors.
2. No paper or digital trace
A persistent issue in cash handling is the absence of a paper or digital trail. You are protected by keeping a transparent record of your cash handling procedures, which also makes it simpler to spot and fix issues when they happen. You can see who has access to your money and where it is.
Because of this, it is advisable to employ automated cash management technology, which may greatly reduce errors and make it easier for you to spot and fix them. Human error is a common problem with outdated manual operations. Smart safe and cash recycler systems are available that monitor safe users’ activity, including who is depositing money, how often, when, and how much.
3. Safety Defects
Not all physical security issues can be fixed by purchasing intelligent safes or cash recyclers. Additionally, you must improve security in the handling of cash at the point of sale. For instance, receipt cancellation is a significant problem that needs to be addressed. When someone pays with cash, cashiers will occasionally attempt to steal by deleting the transaction from the register.
As a result, the cashier retains the money in their pocket and the firm has no record of the transaction. Employee theft is decreased with a good point-of-sale system that forbids cashiers from carrying out this task without special authorization.
What are the Key Elements of Cash Processing?
Cash processing is the process of handling cash transactions and making sure that all financial obligations are met. Business and Financial Services (BFS) lists these five crucial areas for managing cash handling:
1. Accountability: Anyone handling currency is accountable for adhering to policies, maintaining security, and using discretion. There must be records of all monetary and administrative transfers. Additionally, any overages, shortages, voids, and refunds must be signed and verified by the cashier or anyone else in charge of the cash-handling procedure.
2. Physical security: Cash should, wherever feasible, be kept out of sight. Cash counting needs to be done privately and away from the general public. Combinations and access codes for safety deposit boxes should be complicated and obscure to anyone who isn’t directly using them.
3. Separation of duties: Ensuring that distinct team members are in charge of the various cash management responsibilities increases transparency without compromising security.
4. Reconciliation: By verifying the amounts of cash tallied and transferred and recording this procedure, any discrepancies will be swiftly brought to light and the likelihood that cash has gone missing will be reduced. By basing your cash handling methods on these five unwavering principles, you may handle physical currency with the utmost efficiency and security.
5. Receiving: The first step in cash processing is receiving the money from customers. This can involve taking in deposits, issuing checks or electronic payments, or collecting money owed by customers.
6. Clearing and Settling: Once the money has been received, it needs to be cleared and settled so that all financial obligations are met. This includes reconciling accounts receivable with accounts payable, paying bills on time, and ensuring that funds are available to cover future liabilities.
Best Methods To Optimize the Cash Handling Process To Reduce Costs
In an industry where the difference between making money and losing money is small, you can’t lose money or be bad at managing cash. Here are some things you can do to make managing your cash easier, save money, be more efficient, etc.
Set up a standard way to deal with cash
Cash management needs to be able to be done the same way in every business. Retail managers should sometimes work with upper management on the task. The process can change how cashiers take money at the register and when the money needs to be put in a safe or taken to the bank.
Whether or not you use a cash-handling solution, here are some rules to follow when standardizing your cash-handling process:
- The company’s money can only be handled by people who are allowed to do so.
- The cash drawer should only have the least amount of money possible. Extra cash should be put in a safe on a regular basis.
- When cash is being moved, there should always be at least two people who are allowed to be there.
- When counting cash, there must always be at least two people who are allowed to be there.
- The person who handles the money at the register can’t be the one who puts the money in the safe.
- The person who handles the money at the safe can’t be the one to put money into the cash register.
- The person who knows the combination of the safe can’t touch the money in the safe.
- When not in use, cash drawers must be locked with a lock and key.
- When cash is taken out of or put back into a safe, there must always be two authorized employees there.
- There should be a cashier activity sheet that lists the names and times of people who take money out of and put money back into the safe and cash drawer.
- When money is taken out of or put back into the safe, two people must count it. Both people have to sign the cash activity sheet and say that the amount written down is correct.
- The cash must be broken down into different parts, such as the number of coins, bills, checks, credit card slips, etc.
- When the cash is given to the next person on the team, the person who gets it must count it and sign the cash sheet to say that it is okay.
- Keep the cash sheet with the cash and don’t take it anywhere else.
- The cash sheet and the deposit slips must match.
- Every cash deposit must be written down.
Train your employees on how to deal with cash
Training your employees is an important part of managing how cash is handled. Your workers will always be an important part of how cash is handled. You need to teach them how to handle money well and avoid making mistakes. Retraining older workers are just as important as training new ones for the first time. This lets your management team know if someone has bad habits with money, like putting away small bills that could be used as change.
Purchase a good point-of-sale (POS) system
There are many different types of point-of-sale (POS) systems on the market, so it can be difficult to decide which one is right for your business. The following advice will help you select the ideal POS system for your business:
1. Consider Your Business Needs
Your business will need different features in a POS system than another business might. For example, a small grocery store might need a more basic POS system that only handles transactions, while a clothing store may want features like inventory management and sales tracking. It’s important to research what each feature entails and determine whether those features are necessary for your business before making any purchase decisions.
2. Consider Your Budget
When choosing a POS system, it’s important to keep in mind your budget. Some systems are more expensive than others but may offer more features than cheaper options. It’s important to figure out what you need and what you can afford, and then look for a POS system that falls within those parameters.
3. Consider Your Personnel and Training Requirements
When choosing a POS system, it’s important to consider the personnel and training requirements of your business. Some systems are more complex than others and may require more training to use effectively. It’s important to assess whether the required training is something your business can or will afford, and then make a purchase decision accordingly.
There are a lot of different point-of-sale (POS) systems out there, and it can be hard to decide which one is the best for your business. But if you are looking for the perfect system, you should definitely consider SWIL.
SWIL is a cutting-edge POS system that offers a lot of features that other systems don’t. For example, SWIL has an integrated inventory management system that makes it easy to keep track of your inventory levels and sales data. Plus, SWIL comes with built-in security features that make it safe to use online and in-store. In addition, SWIL is easy to use and can be customized to fit your specific needs.
FAQs–
1. What are the cash handling procedures?
Cash handling procedures are important to business owners and employees who need to ensure perfect cash flow. There are a variety of different cash handling procedures that can be used, depending on the business.
2. What does cash Handling mean in retail?
Cash handling in retail can be broken down into two main categories: cash handling and bartering. Cash handling refers to the process of receiving, storing, and disbursement of cash. Bartering typically refers to the exchange of goods or services for money.
3. What is the best way to handle a cash transaction?
One of the best ways to handle a cash purchase is to use a physical cashier. This allows for quick and easy transactions, especially if the item you’re buying is large or expensive. Unfortunately, this option can be expensive, so it’s important to compare prices before making your purchase. If you don’t have money on hand, it may be better not to purchase anything at all.
4. What are the 5s of retail operation?
There are five key aspects of a retail operation that can impact a business’s bottom line. These five key aspects are merchandising, customer service, inventory management, advertising, and payment processing.
5. What is a cash float in retail?
A cash float in retail is a term used to describe the practice of selling items with money present but not yet counted as revenue. This can be done in a number of ways, including allowing customers to pay for items with plastic cards or slips that are then counted when the purchase is made.
Conclusion
The best way to protect your money in the retail setting is to follow cash handling procedures thoroughly. By doing so, you will be able to ensure that your money is treated with respect and that it remains safe and sound.
In this article, we have given some tips on how to protect your money when handling cash at retail stores. These tips can help you avoid costly mistakes and improve your overall shopping experience.
