How to Spot Employee Theft

Industry studies have shown that employee theft accounts for roughly 4% of a restaurant’s annual sales. While that may not seem like a large percentage, if you consider a restaurant that does $1,000,000 in sales annually, that equates to $40,000 in theft. That’s quite a large sum for a business to lose. Protect your profits by setting up systems that make it easy to identify when and where your restaurant is losing money.

Blog_Employee_Theft 07122018A common scam in the restaurant industry is the transfer scam, sometimes known as the floating Coke. Basically, an employee will enter an item into the POS system that is not routed to a kitchen or bar printer, such as self-service items like sodas, coffee, or soup, then transfer that item between guest checks rather than ringing it in each time a guest orders the item. By “floating” the item from check to check, the server pockets the money that each guest pays for that item, while the restaurant only receives payment once from the initial sale of that item. 

Stop Theft Before It Starts

So how does a restaurant owner catch a scam like this? Begin by placing thresholds on the number of deletes, voids, and transfers in the POS system that an employee or manager can make. If an employee is regularly making multiple transfers during each shift, he may be conducting a transfer scam. A more thorough investigation may be required to confirm any suspicion, but exceeding set thresholds is a good indicator that an employee is stealing.

Sometimes employees will blatantly steal food and alcohol simply by picking it up and walking out the door. This type of theft is often easy to catch, especially if the restaurant uses an inventory management system that can track inventory and closely monitor high-priced items that are easily stolen. By investing a couple of hours each week, a restaurant owner or manager will quickly notice when certain items go missing. Once a pattern is established, the culprit(s) can be identified and held accountable.

The restaurant industry is notorious for employee theft. Whether it’s a complicated credit card scheme run by multiple staff members, or simply taking food and supplies from your storage areas and walking out, restaurant owners need to be aware of the signs that their employees may be stealing. Additionally, knowing how to prevent and deter theft is equally important to protect your profits.

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