Cash Loss: The Case For Change - Retailer Updates

In our annual update, the working group discussed their latest initiatives to reduce cash loss, many with losses less than 0.1% of cash takings while reducing the costs and complexities of handling cash, which for some of the retailers in the working group can still be up to 40% of all their transactions / sales.

What emerged were three current challenges, dilemmas and concerns

First, social engineering, in USA especially, the retailers reported the growing threat of cash scams, counterfeit currency and fraud through POS, especially gift cards and bank deposit requests.

Second, some retailers are now adding cash as a payment option for self checkouts [typically self-checkouts are launched as card only] with one reporting that their self checkout participation had grown from 70% to 80% with cash as a new payment option, however this then came with a corresponding increase in handling costs, with new and different types of risk levels.

Finally, in USA, a new problem related to cash is the planned withdrawal of the one cent coin, many retailers reported in the meeting how they are looking to plan to round cash totals, to update systems, educate customers, and to be guided by national laws and guidelines on the transition.

The working group then heard retailers share three broad initiatives that they are taking to prevent loss, reduce risk, improve controls and automate cash processes.

#1: Cash Automation & Smart Safes

This was the most mentioned, for some of the retailers, they had been in use for over 12 years while others had just deployed, others were on the edge of some trials.

Smart safes automatically *count, validate, and securely store** cash, providing stores and the home office real-time dashboards and provisional bank credits overnight. What the retailers shared was that smart safes can help a) lead to a dramatic reduction in theft and reconciliation errors, b) less manual handling of cash and reduced back-office workload and finally, c) improved accuracy of reporting through direct integration with POS and treasury systems.

#2: Closed-Loop or Recycler Systems

The goal behind these systems is to create a *fully closed cash loop**, removing human handling wherever possible. The recycling systems dispense and accept cash automatically, issuing floats to tills at the start of shifts, or as one retailer put it, loans, and then reconciling at the end.

The benefits include a) reducing internal theft and counting errors, b) providing continuous tracking of cash movement and finally, c) automation and improved store productivity

#3: Enhanced Data Dashboards & Reporting Tools

Finally, several retailers talked about improved visibility to the data on cash loss via dashboards and then analytics was for them a major breakthrough. These dashboards ingested POS, treasury, and smart-safe data, to display, and to then allow for real-time monitoring and store-level accountability.

To help turn insight to action, several retailers sent “nudge” alerts or push notifications for store teams when anomalies were detected.

And one retailer shared how they had created a dedicated "cash loss tzar" role within their AP team to take ownership of the data, the dashboard and compliance and then working with the stores that were not delivering the right level of compliance and results.

In short, what one can conclude from the meeting is that retailers’ innovation priorities are shifting from manual process improvement to automation, analytics, and AI-assisted controls, with a clear goal of creating a secure, low-touch, data-driven cash ecosystem.

If you would like your retail business to be part of the working group, click here for the landing page and join our mailing list to get a weekly email on upcoming meetings and new research.