Employee Theft? Here’s my story.
In the early 90’s, my brothers and I distributed packaged ice cream (Haagen-Dazs, Ben & Jerry’s and Edy’s) to supermarkets across St. Thomas, St. John and St. Croix (US Virgin Islands).
In addition to our distribution business, we operated 2 ice cream concession stands at the airport in St. Thomas. I drove a truck and made deliveries to stores and was also the concession manager. Business was great. We had a captive audience and flight delays were the norm. People loved to eat ice cream while passing the time and we sold a ton of novelties, cups and cones.
I was 24, single and paying only $250 a month rent for a room with an ocean view. Our distribution business was struggling, but the concession stands were making a solid profit and I felt “rich”. This scenario left the door wide open to become a lazy concession manager. Why do anything different when things are going so well?
My older brother John was also enjoying his share of our lucrative little stands. But John seemed to think that we should have been making more. He would mention this and I would sort of look at him sideways and tell him he was crazy. I would say “Come on John, my employees?……my girls go to church on Sunday and are God fearing. I treat them great and they do a great job. No way they’re stealing from me”.
John wasn’t convinced, but he left it alone for a few months. Things continued to chug along and we continued to make good money consistently. Then I started to notice that my employees were wearing nicer jewelry, getting their hair done, and in general showing signs of doing better than the $6/hr they were making (min wage was around $5 at the time). I started to wonder, but could still not believe that they would steal from me. I really tried not to think about it too much. The thought of approaching them and somehow sounding “accusatory” freaked me out. It was a lot easier to simply ignore it and keep working hard on our distribution business.
John did not leave it alone. When I took a vacation, John took over the duties of opening and closing the concessions. We had a very simple operation. Each stand had a 16 drum cabinet. We had 8 tubs on one side for scooped ice cream and the other side was all ice cream novelties, primarily Haagen-Dazs Bars. We sold everything for $2 each.
John decided that he would inventory the novelties. In the morning, he had 200 bars and at the end of the day he had 80. Simple math says we sold 120 bars. At $2 each, we should have $240 in the register for those sales. Well, there was about $260 in the register at the end of the day. But……. a quick look at how much ice cream was scooped out of the tubs told him that we sold a lot more than $20 in ice cream scoops. So…..John was 100% right. My girls were not only stealing, but stealing big.
We ended up doing a secret inventory on each employee and it turned out that they were all pocketing cash. Some a lot more than others. We eventually got rid of all of them and established ways to measure inventories at opening and closing and let each and every employee know the policy. We counted all the cups and cones and novelties twice a day, without fail. Our profits went up considerably. I was embarrassed that I didn’t see it coming, but was happy that John followed his instincts.
I’m sure most of you that are reading this story have had inventory controls in place since day one. Today, technology makes it easier to keep track and manage inventories. But for those that don’t have solid controls in place, you can only blame yourself if people take advantage of you. My dad used to always say “don’t leave money sitting out in the open. If someone steals it, you can’t blame them”.
If you have an employee theft story, please comment below and let me how you handled it. If you have good controls in place to keep employees honest, please share that too. Or, simply let me know what you think of my story.
Thanks for reading this post!
President
KeyWord Farm, LLC
www.TurnKeyParlor.com
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sales@turnkeyparlor.com
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Hi Neil,
Is this your first post? If so, I think it’s interesting that you chose this topic. (In troubled times, people are always looking for someone to blame. I’m glad to see you brought this up about it being your own fault.) I would so much rather read a story about how you improved your business, how you got started in ice cream, or some other interesting topic. You calling your employees “your girls” is telling of your attitude, and might be why they were interested in stealing from you – not that it’s any excuse. “Your girls” were most likely adult women (or else they would have been too young to work) and, unless, the laws are different where you live, not “yours” in any sense. How about coming into the 21st century and writing about something more progressive – employee relations, keeping morale up while keeping your business honest, etc.?
Thanks for reading. I’ll be interested to see what your next post is about.
Wow….yes, my first post. I guess you missed the part about me being 24 and not a very good manager. Yea…maybe using the term “my girls” was out of line….but I was trying to convey the idea that I felt we were part of a team and that I couldn’t imagine them ripping me off. Sort of like a coach would call a basketball team his “kids” or “boys”. I do see your point though, so my bad. Thanks for being the first official comment on my blog and please continue to keep me in line:-)
My story is one of a dishones employee also. However to find out how she was stealing took us two years and thousands of dollars. All the servers had waiter banks except for the front cash register which was for carryouts, done by the hostess. What the server would do is when she would get a cash ticket after collecting the cash, she would transfer her table to the carryout section and pay out the ticket. The cash should have gone to the carryout front drawer. Several times a week the front drawer was short $100 dollars and we could not figure how we came up short. We installed camara’s and even had the manager over see all the transactions. She was finally caught when she transfered three cash table in the middle of the day all to an odd table in the bar and with the managers card deleted all three table. $165 dollars worth. The manager had just taken a sales reading and notice we had negitive sales for that hour. Watch servers who can transfer tables and know who you hire. We have never had a problem like that again, because our system now requires a managers OK to transfer tables.
Dennis,
Thanks for your post. Sounds like that particular server got too greedy and it caught up to her. Good for you. Glad to hear that you put measures in place so that it doesn’t happen again.
Neil
Neil, I just wanted to congratulate you for not telling Denise to go shop elsewhere. I did and still do when I am dealing with such unjustified criticism. This to me, shows that you are a very professional business man.
Thanks Mario. Appreciate the support and the kind words. I do my best to keep an open mind and see things from other people’s perspectives and I’m not always successful at it. It is definitely a hard thing to do on a consistent basis. Thanks again for your post.
Neil
How weird it is. This story couldn’t have come at a better time. My husband and I just recently experienced the same thing with our employee. I thought she would never do this to us but the whole time she was giving out free ice cream, food, etc to her friends. We had suspected but could never catch her until we set up a camera. Needless to say she was fired. Sad to say, but never trust anyone!
Thanks Carrie. A lot of times employees, especially younger ones, think that the owner is making a lot of money. This irrational thought process leads them to think that it’s ok to give free stuff to friends. They have no clue about overhead and even less of a clue about what it takes to make make it these days. Glad to hear that you were able to “fix” the problem. Thanks again for your post.
Neil
When I read your story, I found it informative. Because you referred to the girls as your girls is telling? A reason for them to steal? Come on Denise. Get real. My wife is manager of a store which employees 24-32 people, depending on the season. She refers to the women as her girls. I’ll tell her to cut it out. Maybe the theft will decrease. Anyway..constant inventory control is a must if you want to see minimal theft, however no matter what there is always that employee who figures an angle out. You just have to develop a gut feeling for the theif..like your brother did first on.
Thanks for the post Chris. I agree with the “always and employee who figures an angle out”. It’s a little depressing that you have to be constantly vigilant, but hey, nobody said running your own business where cash exchanges hands was easy.
Neil
Wow Denise. Wow. Even I found that in poor taste… Are you bitter? Neil, I thought that was a great story – glad to see that you could learn and grow from it, as I am sure we all will. Thank you.
Thanks Stewie. Appreciate the post.
Good start Neil on the blog. A lot of useful information and a topical subject. In my operation it is all about internal controls. I find that if employees know there are control systems in place they are less apt to steal. A red flag for me is when you hear through the grapevine that employees think the bosses are rolling in dough. Its only happened to me a couple of times but in both cases it was due to the wrongful belief on the part of the employees that systems were NOT in place and the culprits tried to help themselves. We have 11 litre tubs in Canada. Can anybody tell me how many servings of ice cream one would realize on a per tub basis?
Thanks for the comment Brian. Yup, if they know controls aren’t in place, many will take advantage.
From what I understand, the 11 liter Canadian tub holds roughly that same amount of ice cream as the US 3 gallon tub. 3 gallons = 11.36 liters.
US manufacturers and sales reps say you get 55 four ounce scoops out of a 3 gallon tub. In reality, you can shoot for a four ounce average serving, but I think you end up around 45-50 depending at how good you are at scooping. That said, I would price it assuming 45 servings per 11 liter tub.
Thanks for the e-mail. I have been in the food service/Bar business for 28 years. It’s late and I could go on and on. I’ve owned two bars/supper clubs/sportsbars. and two ice cream parlors and numerous other businesses. To say don’t trust anyone is an understatement, yet, to live life like that is very dull. I read about a farmer that was asked about his crop devastation by local wildlife. The local neighbor asked him how he felt about all the crops he keeps losing year after year…his reply was “I just plant twice as much.” I have lost over $3 million yes that’s 6 0′s because I trusted people, to this day I still do, and I know God will take care of my family and me with what we need. My prayer when I think about all others is this”May God give you evrything you have coming and a little bit more.” My only peace of mind is when i give it to God. So, have a great night (or day) and sweet Dreams.
Jon,
Thanks for the comment. I fully understand your approach to dealing with theft. Sometimes it makes more sense to accept that a certain amount of theft is going to occur and either price it in to your model, or simply accept is as a cost of doing business. Peace of mind is more valuable than anything else. Thanks again for taking the time to comment.
I think this is a great subject. We had an employee ask if she could buy a couple empty ice cream tubs. My manager had a bad feeling about it and showed up at closing time. She had a full tub of ice cream and the empty on top stuffed with chocolate going out the door.
Our business is very hard to inventory and also we can’t afford expensive computers and programs to assist with that right now.As a former manager in the jewelry business I turned to a company called Vangent that produces the Reid Report. It is an “honesty test” that measures integrity and risk and also sales productivity.It helps you hire better people from the start. Not that controls should not be in place, they do need to be but its another tool to minimize risk.
Thanks for your post Melanie. I understand that it is harder to manage inventories depending on the business. Sounds like you have a program in place that helps you manage the risk. That said, sometimes “faking” inventory control is a good way to keep employees guessing enough to figure its not worth trying to pocket cash. Maybe periodically inventory a few items that you know are the best sellers. Do this randomly. Might be tough to do in your business either way, but maybe for others, this is possible. Can’t hurt to try.
Neil
It’s a penny business….. I have been doing it for over 25 years. We all know that our employee’s might steal from us. To what extent is how much we allow it. I have worked with 1,000’s of operations from small dip stands to major franchises. What every owner needs to do is keep an eye on the sales, inventory and in some cases, the garbage.
Everyone has their friends or family that come in, if you sometimes pay them enough not to steal or give them an incentive to do better it works more times than not. With that being said, doing a cup inventory and a cone inventory at the end of their shift will show employee’s some signs of checking up for theft. Another way is keep a running inventory of tubs (we all know how many scoops we can get out of it) or containers, if you make your own. This will help on ordering, not being caught short and getting a better handle on your business.
Another way to start the day is always practice a few scoops before each shift to get the feel of a your general scoop size. A little harder in soft serve.
Great post Larry. I agree with you on all fronts. Thanks for sharing what has worked for you over the years.
Neil
Thanks for sharing your story on theft. I also learned the hard way though not in the ice cream business. I had a contractor supply store and several outside sales people. I caught some of the loss as I did ongoing inventories, but I was not nearly as aware as I should have been. It was only after selling the business at a loss, when all the time I had been told by my accountant that we were making money, that I realized a large part of my profits had been going to other pockets and not back into the business. It was a painful lesson, but one I hope to never repeat. I’m actually designing my small ice cream business to utilize mobile carts and to go to functions where the people are, rather than open a store front business. It will be more seasonal I know, but with a smaller investment I can grow as large as I desire without some of the risks and cost that come with a full store front business. I’ll be talking to you as I get closer.
Great points Ariel. This is why you need to have a good feel for your business from day 1. Computers are great and having a real accountant is a good thing, but you need to have a sense of what is going on and you can only get this by working the business from the start. You can’t always rely on someone else telling you that all is good. Sometimes, doing the numbers the old fashioned way – with a pad and pencil and calculator- will help you get a better feel for what is actually happening. Once you develop a good sense of the business you can back off a bit because if something is “fishy” you will be able to identify it much quicker.
Neil
Neil
I enjoyed your topic and subsequent posts. I think it brings up an issue that allows much discussion and many different view points. Obviously, Denise is a “girl” with a bad attitude–she probably hates men and maybe she was one of the “girls” who stole from you!! Anyway, I look forward to future postings regarding running an ice cream business–pros, cons, and any advice is welcome.
Thanks for the post Rob. Look forward to your posts too!
Neil
We are a hamburger, ice cream old fashioned diner. Employee theft has been a continual concern of ours and short of being there all the time, don’t know if it will ever completely go away. We are going to install cameras to help and we take inventory as well as you can with soft serve. Our employees get free food while working but it seems the money just never matches at the end of the day with the tickets. You can only blame handing out incorrect change so many times. I agree it is our own fault for letting it go on as long as it has. We should have installed cameras a long time ago. I will let you know if it helps. It is bad that when you try to treat your employees fair, that you still just can’t trust them completely.
Don’t beat yourself up Lucy. At least you know that you have to work on the issue and you are not completely unaware. Let us know how the cameras work out and if that seems to help.
Neil
Hi – very interesting comments from everyone. Thanks Neil for kicking this off. Our story – My wife and I own and run an Ice Cream Parlour in Napier NZ, we have been in business nearly 5 years, many employee’s have come and gone over this time. Employee theft is very difficult to detect but a few thoughts come to mind, some along the same lines as those already mentioned.
Gut feeling about these things is almost always right, and even if it isnt the worry you have as an employer regarding the suspect employee is enought to make you sick. Employee’s always find ways around your checks. I installed a camera a few years back but watching the tapes was pretty boring, it is still there now for decoration (maybe it helps?) The only way to avoid employee theft is to work in the shop yourself and watch what is going on. The joys of being in business eh?
Thanks for your post Steve. I think the camera helps, even if you don’t review the tapes regularly. At least it’s there and if you started seeing some odd sales declines, you could start taking a look at what might be the cause. Thanks again for your post.
Neil
Good stuff Steve. All the way from NZ! Thanks for sharing your story. Yea..the joys of being in business is right:-) Thanks again for taking the time to post your story.
Great Post Neil! What a high class reply to Denise too! Kudos! I believe your posters can see right through her sort of rhetoric. In my experience you do need to build in a certain amount of theft and have to agree with million dollar Jon, don’t let it eat you alive. A favorite saying I refer to is “trust in God and tie up your camels”.
At the very lowest point of control is…faking the inventory. Just do it. Don’t feel weird about starting the process if you haven’t been doing it either. The employees will just learn to deal with it. If you have to make it part of some ones job. I found pulled an extra 2-3k per month after I hired a “manager” to count certain items and just act like they were doing something. Amazing.
I think a blog post about serving size would be a great idea. I know that I would feel funny scooping out 4oz into a cup sometimes and it would be interesting to see how many people actually weigh the scoop on the way out.
Great job again and Thanks!
Neil, it was a timely article. We were having some suspicions about an employee, mostly to do with “No Sale” on the till. In the last couple of months it went from about 5 a day to 25-30 a day. We didn’t notice it right away, but it is a classic way of pocketing cash from cash sales. We never did prove if there was any theft, but once one of us was around, the “No Sale” occurrences went down.
Another example, which I don’t know if you would actually call it theft, would be the addition of more product. For example, my daughter was working with an employee and this employee was making a sandwich for a customer. Our recipes are priced out with 3 slices of meat, but our employee was adding 1 extra slice on because it didn’t “look” like enough meat. She has done this in the past with cheese and bacon as well. That little extra drops our margins down quite a bit. Just last week a customer came up to my wife and said how much she enjoyed her strawberry milkshake with real strawberries. My wife informed the customer that we don’t use real strawberries in our milkshake, and that it was strawberry syrup. The customer said that one of our employees had added real strawberries. The customer may have been happy, but if it’s not priced out with that in mind, we are losing money.
I’m also enjoying all the replies that people are leaving. Thanks Neil
Thanks Larry. Great Post.
Ahh….the old no sale trick. Glad you were able start controlling that problem. Yea…I hear you on the food cost issue, but that isn’t nearly as bad as pocketing cash. As you mentioned, the customers are happy, so that’s a good thing. Maybe you should consider raising prices a little to cover the empolyees making the servings too large. Yes, people will complain, but if the product is good, they will keep coming back for more. People love to complain no matter what you charge, so don’t be afraid to price things where they need to be. That is one of the biggest problems in the ice cream parlor business. Not charging enough. A lot more business go under because prices were too low. Not as many fail because prices were too high. Give people a great product, charge them a fair price (one where you make a good profit) and your business will thrive.
Thanks again for the post Larry. Good stuff.
Great Blog Neil. It’s interesting to hear everyone’s story, and as you know, we have certainly had our share!
Neil, thought your article was right on. Denise needs to wake up to the fact that the fundamentals of running a business is as important as good employee relations. Bet her employees are happy, especially the ones with new jewelry!
Thanks Dan!
Great story Neil.
My parents owned a Carvel franchise store front. They hired a girl who was very diligent. She would always enjoy taking all the garbage bags to the back dumpster late nights. My father thought it was weird. One day he decided to follow her to the dumpster without her knowing and just watched. Sure enough she would open each garbage bag and take out a small carvel bag. He caught her right then and there. A whole bag of money inside. Of course she was let go. Ever since that, they decided to work it themselves. It is very hard to hire help.
Thanks Neil for this wonderful learning blog.
Neil,
Thanks for such informative info. I will be opening a retail store in the spring and any advise is greatly appreciated.
Neil,
Have started just the same way as you however have not yet gone into retail here in Ireland. We are the second biggest ice cream eater in Europe so whats my next move? How can one make the big step from wholesale distribution into retail?
Thanks for posting your comment all the way from Ireland David. My answer to your question would be to start VERY carefully. Be conservative. Don’t dive into retail with big plans to open multiple stores. The last thing you want to do is lose focus on your core business (distribution) and be micro managing retail operations. While we had the concession, we made good $, but it took time away from growing our distribution business. I’m not saying you can’t do both. Best bet is to find a manager with solid retail experience and bring him on to your team. I would create a separate corporation for the retail business and offer this key person (the retail manager) ownership in addition to salary – around 15% or whatever you think is appropriate, depending on level of experience. Bill the retail operation the same prices you would charge any other wholesale customer, this way you get a real reading on the operations profitability.
Depending on what product you will be dipping in the retail operation, make sure you get support from the manufacturer, since you are in essence creating another marketing arm for them. I would work with the brand that offers the most support, or the brand that you think gives you the best chance of success.
In summary, start with one store in a great location (even if the rent seems high). Make sure you hire a rock solid, well paid manager that can hit the ground running. Learn the business and get all the kinks out with one store and then expand from there.
Thanks again for your post.
Neil
Hi – does anyone know where I can purchase a scoop (dipper) washer? One that they call a river type where the water is always flowing?
Steve:
Click this link for the best dip well (“mini sink” that attached to the dipping cabinet where you keep the scoops) on the market. $190 includes free shipping in 48 states. http://turnkeyparlor.com/Dip-Well.htm
Thanks,
Neil
Interesting, Neil !
Now, I appreciate to know if somebody else knows about a software or methodology the business owner can have a very precise way to control the scoop portion and the cash in the ice cream store.
Background check is very helpful too and check out the employee referrals is very valid.
Please, I appreciate if somebody knows very effective way to track down this theft employee problem.
Thank you
Washington
Washington:
We did it the old fashioned way back in the 90′s. Today, there are POS systems that will do this for you. But back then, we didn’t have a lot to inventory, so here’s what we did. Every day before we opened, we filled out a form where we did a count on cups (large, medium, small) , cones (sugar, cake, waffle) and novelties in the freezer. Each one of these items had a retail price associated with it. So, for example, if we had 100 large cups at the beginning of the day and 50 large cups at the end of the day, we sold 50 cups. If our retail price was $4 for a large cup, then we should have $200 in the register for large cup sales. Do the same for the other items, and you will know what you should have sold in total.
We actually went a little farther than this in order to encourage our employees to scoop properly and not give away too much product (we found out that airport employees were coming to the stand with their own containers and the girls were giving them free product – which was not visible to us via the inventory sheets). Here’s what we did to manage this problem. We started with a fresh 3 gallon tub, and scooped a few regular servings out and saw that each serving represented about 1 centimeter out of the tub, if scooped evenly (scooping evenly is critical and very few people do it right). Yes, we actually put a ruler in at the start of the day, to determine how much ice cream was in the tub and then measured how much ice cream was in the tub at the end of the day. We assigned a dollar value per centimeter and were able to determine, approximately, how much ice cream was scooped and how much should be in the register at the end of the day for each tub. This was not an exact science, but it showed our employees that we took inventory control very seriously. Most of the time, all it takes to keep your employees from temptation is being a little extreme about inventory. It is time consuming and tiring, but if you are in business to make money, it’s worth it.
I am a mom and I call the girls who work at my store “my girls” also. Don’t worry about the term used – its just because you’re a man that someone pointed it out. I also agree that the reason why u used it is the same as mine – its because your employees are part of a Team, and you trust them.
John was absolutely right.. Ive trued a number of time of keeping my employees motivated.. but eventually its true.. No Matter what you do, they will definitely try to steel even the chuck out.. so vigilance is the best policy.. lemme know what are the latest technologies in practise to help curb the theft..
regards,
Junaid
Hi Neal – all great information and something for me to keep in mind when hiring, I’m just starting out, and enjoy reading all of the experiences of others. Can’t wait to read the next post!
Pat
I don’t like the use of girls either. I used to work for the minimum wage when I was 17 years old selling nutritional supplements ranging in price from $125 to $250. The store owners knew they could trust me with their money so after a while they stopped coming to work and I did everything. I grew to resent it because I had to run the store, sell products, do shipping, inventory, wash the windows, mop the floor and clean the bathroom. They only showed up to collect the money at the end of the week. They also referred to me as girl and because I was an immigrant they would tell customers I “came on a boat.” After a while I hated it so I quit. Before I migrated I had a very prestigious life so I found them not only to be offensive but also unprofessional and uncouth. When people are working for minimum wage the least they have left is their dignity. They should be treated in a professional respectful way and girl just doesn’t cut it.
I quit that job. But that experience as a teenager just wanting to try out the job market informs my decisions today. I own my own business now. I treat people the way I want to be treated.
As for theft I would say the best defense is inventory a few times each day and making people responsible. If you have very expensive smaller items lock them in a show case and put one person in charge of it for the day. It makes people feel important to be in charge while also making them more responsible. I decided to create zones for jewelry, skin care etc, each with it’s own person in charge. Do employee and family and friends discounts sometimes. Also, allow your employees to feel comfortable enough to speak with you.
All her life my mom worked for a company which let her share in the profits and also gave her a bonus check at Christmas. She loved working for them because she felt they cared about everyone at the organization. It’s something I hope to do as we grow. There’s nothing better than an employer who want’s his/her staff to grow as they grow. It’s great for employee loyalty. Let’s be real, most people can’t live on the minimum wage.
Shaz:
Thanks for your comments. Happy to hear that you quit the job where you weren’t treated well. One should never stay in a job that they are unhappy in. There is always another option. It doesn’t seem like it, but there always is. One door closes and another opens. I’m not saying that you have to love your job, because as we all know, work is hard and not always pleasant. But being treated badly is unacceptable and should not be tolerated.
For the record, I never called any of my employees “girl” or “girls” directly. As I stated before, I referred to them as “my girls” when talking to my brother only. I always treated them with respect, even after I found out that they were robbing me blind. I didn’t even fire them….they just quit soon after I implemented inventory control. I assume they figured they could go work somewhere else where they hadn’t caught on to inventory control methods.
Glad to hear that things are going well for you in your business Shaz. Keep up the good work.
Neil
I HAVE TAKEN THE TIME TO READ YOUR FIRST ARTICLE. I HAVE ALSO READ WHAT PEOPLE WROTE. HERE ARE SOME OF THE WAYS TO PREVENT STEALING.
IF YOU COME INTO YOUR STORE AND SEE A CALCULATOR NEXT TO THE REGISTER,AND THE DRAWER IS NOT CLOSED….THEY ARE USING THE CALCULATOR TO DETERMINE THE AMOUNT OF SALE, OPENING THE DRAWER WITHOUT RINGING THE SALE, MAKING CHANGE
AND POCKETING THE MONEY.
TO MANY NO-SALES IS EASY TO SPOT.
BUY REGISTER TAPE WITH A STAR,MAYBE 3 STARS PER ROLL, PLACE A SIGN NEAR THE REGISTER IF YOU DON’T GET A RECEIPT THE SALE IS FREE, IF YOU GET A STAR YOUR NEXT CUP IS FREE. ONCE THE SALE IS RUNG IT IS EXTREMELY DIFFICULT TO BACK OUT WITHOUT RAISING A RED FLAG.
CLOSE THE REGISTER AT DIFFERENT TIMES DURING THE DAY, COUNT THE DRAWER, IF THE DRAWER IS OVER MORE THEN A DOLLAR OR TWO, THEY ARE BUILDING A BANK WHICH THEY WILL TAKE THE FIRST CHANCE THEY GET. HIRING A SECRET SHOPPER, WILL NOT ONLY TELL YOU IF THEY ARE STEALING BUT HOW THE CUSTOMER IS TREATED. HAVING A TIP JAR IS A SURE WAY FOR THE CUSTOMER TO GET TWICE AS MUCH AS THEY PAID FOR.
THE CUSTOMER DROPS A DOLLAR IN THE JAR AND THE EMPLOYEE RESPONDS WITH OVER SERVING.
COUNTING THE CUPS IS A METHOD USED BY MOVIR THEATHERS 40 YEARS AGO.
Jerry:
Excellent Comments. I appreciate you taking the time to detail what has worked for you in the past. Thanks again for your post. I like the secret shopper idea a lot. A very inexpensive way to check up on customer service. I had never heard the one about the tip jar being an overserving issue, but it makes perfect sense.
Thanks again for taking the time to read my blog and for commenting.
Neil: I’ve enjoyed reading all the posts. Some
great ideas for getting started in the business.
Keep up the good work!
Great info Neil! Thanks for passing it along…
With an attitude like Denise has she is exactly the kind of person I would not want running a business or working for me in any way, nor would I want to work for her. Talk about an attitude problem.
kudos to you Neil for keeping that first post on this thread. You are clearly a “high road” kind of guy. Having been to the VI I think I may have bought some Ice Cream at one of stands back in the day. In between some of those fancy rum drinks that is..
Hey Neil, Thanks for sharing your story of theft and how you dealt with it. Denise, this story is a form of feedback and I was always told from my early business teachings is that feedback is a gift. If you can find and take something from it to help you then a gift indeed. If you can’t but pass it on to someone who can…a gift indeed. It certainly can help show how to effectively deal with it or to show how to avoid it happening from the start. Either way, thanks for you share Neil, much appreciated.
I’ve worked as a busboy, waiter, bartender, manager, maitre’d, wine sommelier all of my life.
I always made good money and like the food biz…I never needed to steal!
This topic is GOOD to address….very, very, very important! ESPECIALLY IF CASH IS HANDLED!
The best places I have worked had managers that were paid salary AND some sort of ownership dollar amount…period…sometimes it started very low (1to5%) but eventually it would be more…the managers (most) would make DARN sure no stealing or tricks were done (and there are ENDLESS LEAKS employees can pull off..including conspiring with chefs/cooks/managers/customers/general staff)
I ONLY made good money when and if the owner and chef/cook made GOOD food, (and money/pay/salary) otherwise I would not make good money and would move on to a place where they did make good food…I would usually speak to the owners to try to fix the situation but some were too stuck in their old ways, old recipes etc…
Just for the record, I never knew about theft for the first ten years of my food career because I worked at a very busy restaurant the entire time and everyone made good money there and the owner and chef were good friends and did the profit sharing thing. The owner was very succesful and would loan any employee money if needed..pay advances or even a personal loan.
With the exception of my first place of work it seems that sadly theft ALWAYS HAPPENS…people can bring in their own cups, cones, their own liquor!!!!, you name it!!!! and sell that whenever cash sales happen…ice cream is a bit more difficult to sneak in…thank the lord!
INVENTORY CONTROL…several times a day AND….announcing or printing into training manuals or posting you will PROSECUTE FOR CRIMINAL ACTION will stop a LOT of this theft dead in it’s tracks…sad but true…
In my opinion, people CANNOT live on low wages…tip jars MIGHT encourage over serving but can GREATLY increase an employees livelihood…I am a strong believer of tip jars…I also earned most of my living from tips…I think the gain/loss balance for allowing a tip jar can be wellllll worth it…we did it for our kitchen staff…they loved it..gas money or diaper money etc…of course employee discounts are a must..for family or special occaisions…these things DO NOT cost an owner much or anything at all and can give an employee the “feeling” of being on the other side…as a customer…this can be valuable for good service.
The man who said he’s lost 3 million from theft…wow…that is a lot of money to lose but perhaps you have made much much more…I hope so because it is grand theft if over $400 in my state.
I have learned some more inventory control methods from this string…thank you Neil and everyone else! I hope I do not sound like a mean old man…my last job (a very very good one for me, as a waiter..I am 48 and LOVE restaurant work) ended due to the very, very clever theft shceme a ring of employees had dreamt up…the hotel CLOSED the outlet I worked in for 8 years due to failing sales! It turned out to be the bartenders who brought in their own liquor and avoided inventory control on almost all cash sales and two waiters who had worked out splitting cash sales tickets with the kitchen staff, very similar scheme as the bartenders but the kitchen staff would just say the food had gone bad.
Long story shortened, the management was FIRED for not doing their job, becasue when I discovered everything much, much later (I had been transferred to another outlet in the same hotel by then with some of the very same theifs that dragged down my good job!) I reported what I had learned….after begining to watch how things were being done more closely….to the management and they covered it up (they even told me NOT to call the police, and that they’d handle it..afriad for their jobs my 74 yo mom told me! )…so I wrote to the hotel owners in CHINA and their board of directors and told them what I had learned. That cleared house FAST, I have since left that hotel for lack of shifts due to losing my well earned seniority being lost when I was transfered and the compounded issue of recession hit. If the theft had never occured, I would still have a great job, recession and all.
I recently stumbled onto a couple of food concession gigs in my little resorty town…that is why I am here.
I have done some of my own catering in the past (no cash sales there, phew!) and I have been offered an opportunity to do an ice cream trike..hahaha…for the summer..at a BEACH!
All pre packaged but still, an employee sneaking in cost co bought goodies could RUIN me…I will be at that beach the entire summer…I won’t take a day off…next summer perhaps I’ll be able to hire someone to help and give me some time off…keep the ideas coming everyone…I have learned some fresh ones and even recalled some goodies but oldies!
Needless to say….I DO NOT EVER intend to be “relaxed” about theft, inventory etc….I have seen total destruction of a very very profitable restaurant from the hands of just 5 employees out of a crew of 25….I have seen the severe damages caused.
I am going to run my biz as politely and professionaly as possible but the day I hire employee ONE, I will have a developed, total inventory anti-theft system. Including hiring a consultant. (btw, secret shoppers are free if you use friends or other biz owners in trade/barter system)
I hope this is posted and doesn’t come of as bitter. Also, this was the MOST extreme case of theft I experienced in my entire 30+ year food career so far…it ended in the closing of a very nice Italian bistro with great food prices and great talent hired from Italy and California Wine Country. I see an ice cream biz as just as important…it should be fun but it is work and the livelihood off owners and employees alike!
Does anyone have a good ice cream trike/puch cart for sale? I need one for pre packaged goodies by 6/15/2010 or sooner! Used or new! Neil, I will probably hire you for advice with this summer gig I was just offered today! I love this blog!
The stories posted is very informative. One thing about going into biz is the worry about profits going thru the back door. Thanks for sharing and sometimes taking inventory is out most important when you have employees.
WoW! reading all these stories reminds me of how my employees used to rip off customers at my toy store by selling them batteries that were intended to be included with certain toys and pocketing the cash. I also caught one “girl” ( I hope its okay for me to say that lol) clenching coins in the palms of her hands instead of depositing it into the cash drawer, so she would deposit the pennies and quarters so I could hear the sound, but would hold on to the loonies and toonies ( I caught her by asking her to give me high five after she made a sale). I was only 21 at that time and the “girl” was not much younger than me, I guess she felt she could mess with me and didnt take me too seriously. She also had her friends and family come and buy something small and pay with a fifty dollar bill only to give them more money back in change (like 5 twenties or something). I thought Im doing the right thing by being there with my employees and “supervising” the sales, but still despite all that she still found a way to steal right in front of me. I must admit that inventory taking was not fun and I rarely did it, especially when it was super busy and product just came and went all the time.
My dream is to open up an ice cream shop in my neighbourhood, I see total potential but lack any experience in food business (other than a part time donut shop job back in high school). Any tips/advice on how to get started would be greatly appreciated, I can exchange with tips on running student rental properties, and selling toys haha!
One thing I have found as a Christian, going to Church does not mean you are one. Jesus himself spoke of wolves in sheep’s clothing. I do not yet have a store, but it is a good reminder, that there are a lot of sticky fingers in this world. Some people seem to believe it is their right to take what they can. This however, does not mean that you cannot trust anyone! It does however, speak to the degenerative time and generation in which we currently live, where honesty is not necessarily the norm. I often think of the things I have done wrong, and realize that I have no expectations for perfection in that no one will do wrong to me. Business however, dictates frugality and vigilance to realize goals.
I want to own my shops someday and know that my family when they ran a business for their friend was greeted with similar problems with one particular individual and she was past retirement age, so she was from old school and should have had old school values. As I started out saying, wolves in sheep clothing, they are everywhere.
My father always told us he trusts himself. The many times I have been slighted not in business but personally, I can only say that I only trust GOD! I believe HE surrounds us with good and bad, and we have to be careful and whatever happens trust HIM, and know HE is a rewarder of those who do good.
We don’t always make the right choices in life. Hence, we trust others, no matter our age, those who “smile in your face, all the time wanting to take your place, those back-stabbers,” those are the words to the song that express our human nature and thought processes, but there is a GOD and HE sees all.
I always pray and ask HIM for His grace to understand people’s nature and why they made the wrong decision to steal from me. This reminds me I am not guiltless of this sin but I strive to do all things as unto GOD. All who knows me will tell you I am trusted more than most of the people they know, but not being able to pay back when you borrow is also stealing, and that I am guilty of.
So, what is my point? Very simply, I am very sorry for all those who I promised to pay back, and could not. No camera could have caught this type of theft, but it happens all the time. I am working hard trying to rectify this wrong, but catching up seems an uphill battle, and the hill is steep.
I enjoyed the topic, because I know this type thing happens more often than none. Heck politicians rob the people and countries blind, the investment agencies, and banks, and insurance companies, and those making millions are not immune to this problem either. And YES it hurts a great deal to know people take advantage of you, but none of it is worth a life and nothing you gain in this life can be taken with you to the next. It is best to exercise wisdom to prevent theft, but also if it happens, learn to let it go and not let it destroy you, or make harsh judgments. Pray for all who struggle with this bad habit is what I say. That is what I try to remember to do so I can let it go and move on.
Well for me, as a beginner in selling Italian Ice, I thought your story was an eye opener and very resourceful! Thanks for the tip, I know it will come in very handy, thank goodness my sons are my young employees…hopefully it will remain a family business!
Your story was a good one! An eye opener and a great tip helper for me since I’m just starting out! Thanks Neil!
This story is really interesting an d avery good eye opener for everyone especially me. I have already learnt a few lessons from your story.
Thank you.
Well i share the same problem you face, but because of my other job i am in the shop only on week ends, i am not seeing the return on stock purchase each week. Can you help me with a formula for my inventory
Well i share the same problem you face, but because of my other job i am in the shop only on week ends, i am not seeing the return on stock purchase each week. Can you help me with a formula for my inventory
I do not want close my door to the public