How to Balance Cash Drawers Quickly and Accurately

To operate a successful business, cash on hand is critical. Many will claim that cash is on its way out, and though that might be true one day in the future, it is still a long way off. Many people still operate using mainly cash, and customers expect to be able to use cash to pay for their purchases wherever they go.

That makes balancing your cash drawer a necessary business task. While not the most enjoyable aspect of operating a business, it is critical that your cash drawers are correctly balanced. This task can be time-consuming, but it doesn’t have to be. You can learn to speed up the process by staying organized, balancing routinely, and utilizing data from the software you have available.

When balanced correctly and regularly, your cash drawers will always have enough money in them to get your employees through their shifts without disrupting operations or negatively affecting service.

To stay profitable, each cash drawer should be balanced at the close of every shift. If that’s too often and you don’t have the bandwidth to do that, at least ensure you balance your cash drawer at the end of every day.

Balancing cash drawers quickly and accurately is an art, but it can be learned. Here are a few pointers:

Cash on hand and how much businesses should have is essential to running a business profitably. The amount of cash available within cash drawers is a vital part of this. Retailers need to have enough cash in the drawer to get an employee through a full shift. 

Assign one person per cash drawer

You can get away with having one cash drawer on the whole floor, but it’s not recommended. The more people you have operating your cash drawer at once, the harder it is to identify who is responsible when counts come up short.

When you have one employee operating each drawer, you can increase accountability. Yes, you might be inclined to trust your staff, and you’d be right. Most employees can be trusted. But you also have a business to operate, and employee theft does happen. It makes sense to hold employees accountable when it comes to handling cash. You’ll ensure accurate counts at the end of each shift and will run into fewer issues down the road.

Count cash at the beginning of the day

Many assume that counting cash only happens when you balance the cash drawer at the end of each day.

False.

It’s important to start every day knowing what’s already in the till. You need a healthy base of cash in your register at the beginning of each day to ensure that you have enough to cover your operations. This is yet another balancing act. Too little and your employees could end up running out of cash mid-shift and causing hold-ups. Too much and you increase the likelihood of employee theft.

As a note: it’s a good idea to make sure you have the right size cash drawer as well.

Deposit cash throughout shifts

During a busy shift, it’s normal for the register to get a little disorganized, with too many $20s and not enough singles, or vice versa. Regularly tidying the cash drawer throughout the day can help ensure your register is healthy when it’s time for the final count.

Deposit cash during slow periods so you have enough on-hand when business picks back up, and count what’s present. Be sure to remove the difference from your morning count, lest you end up counting twice. It’s also helpful if two people are present for this process. This helps ensure better accuracy and more accountability.  

Pull the POS report for each drawer afterwards

Whether you balance your cash drawer at the end of each day or at the end of each shift, you’ll need to have accurate data on-hand to compare your counts with. Pull the point of sale report whenever you close out the cash drawer. Pop the drawer out and retreat to a discrete location in the store for counting. You’ll need to check the counts thoroughly, so make sure you give yourself ample time.

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Count the cash from each drawer in a discrete location

First, conduct the physical count. Tally up the sum total of all coins, notes, and PDQ receipts, and compare those numbers to the total on the report. It’s not unusual to have a small cash shortage or a tiny discrepancy. Often, with a second count those will go away. If no mistakes have been made when employees gave customers their change, everything should add up.

Identify and solve discrepancies

If you find a major shortage however, you’ll want to review the data from your POS again. Most discrepancies are caused by simple human error and are not nefarious. Look for shortages and overages. Overages means customers were likely shortchanged, which is something you’ll want to look into, in case you need to offer some employees a little extra training. Other discrepancies could mean cash has been lost, stolen, or incorrectly counted.

To resolve this, conduct a recount for all cash, checks, coupons and credit card receipts. If you come up short, double check in and around the register and your cash drawer for missing receipts. Review your POS transactions to see if you can spot anything that could be missing, like receipts. It’s also a good idea to make sure you have someone that can record cash discrepancies on small business profit and loss statements.

Record cash drawer transactions

If you find a major shortage however, you’ll want to review the data from your POS again. Most discrepancies are caused by simple human error and are not nefarious. Look for shortages and overages. Overages means customers were likely shortchanged, which is something you’ll want to look into, in case you need to offer some employees a little extra training. Other discrepancies could mean cash has been lost, stolen, or incorrectly counted.

To resolve this, conduct a recount for all cash, checks, coupons and credit card receipts. If you come up short, double check in and around the register and your cash drawer for missing receipts. Review your POS transactions to see if you can spot anything that could be missing, like receipts. It’s also a good idea to make sure you have someone that can record cash discrepancies on small business profit and loss statements.

How Star Can Help

Even though each store is unique, balancing cash drawers is one thing every store has in common. Star Micronics offers the tools you need to make balancing your cash drawer as simple and painless as possible. For more information on the solutions we offer, contact Star Micronics today!

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