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3 Ways To Stop Product Theft (Before It Hits Your Bottom Line)

3 Ways To Stop Product Theft (Before It Hits Your Bottom Line)

Posted by Colin Robertson on Friday, November 15th 2013

“My employees are stealing from me. I know it.”

The owner of a local Milwaukee bar told the consultant – an expert in detecting employee theft in restaurants.

The consultant had a keen eye for detecting any suspicious behavior from employees that would indicate theft. His usual practice was walking into a restaurant, engaging with the staff as a customer, and keeping a watchful eye on everything. He always found the culprits.

He started this job with his usual routine. He sat down at the bar, ordered a drink, chatted with the bartender and observed. The time passed, he stuck around longer than usual. He stayed all night until the bar closed - he just couldn’t see anything going on that would indicate theft. The consultant was finally beaten. He had to report back to the owner the next day that he wasn’t able to find out how his employees were stealing from him.

“I spent all night at that bar, I watched every bartender, server, bar-back, everyone. I kept a keen eye on all 4 of your cash registers to see if they were pocketing anything. I couldn’t find anything. I’m sorry I wasn’t able to help you out, here’s your money back.”

“Keep it.”, said the owner.

“Please, I can’t keep it. I didn’t find anything.”

“Actually you did... I only have 3 cash registers.”

Restaurant product theft

I heard that story about a year ago as I was interviewing the GM of a Milwaukee restaurant. Ask any restaurateur and they’ll have a similar story. It seems like there’s no end to the creativity that some restaurant employees have when it comes to stealing. Slipping free drinks and food to friends and family, not ringing up items and pocketing the cash, even hiding a bottle of liquor by the dumpster as they take out the trash.

Besides the bottom-line impact that product theft has on a restaurateur, most restaurateurs I’ve spoken with are mostly just hurt by the fact that they’ve been betrayed. They have given someone a job and a means to provide for themselves or their family, and that person turns around and steals from them. Ouch.

For anyone who has experienced this – whether as an owner, manager or employee – here are 3 things you can do to prevent theft at your restaurant:

Know your employees

It’s a lot easier to steal from a stranger than a friend. Make sure you know your employees and interact with them on a regular basis. They will be far less likely to steal from you if they know you, and know that the consequences of their theft will have a direct impact on you and your business. Although this may not stop the true “schemers” that do things like add a cash register to funnel money out, it will have a big impact on the bartender who wants to give a free drink to the hot blonde, or the cook who wants to make himself a free meal.

Make sure the theft guidelines are clear

Make sure your employees know what is okay for them to have for free and what isn’t. If the guidelines aren’t clearly communicated from management, some employees may take a free drink or meal without realizing that it’s wrong. If your restaurant offers a free drink after your shift is over, great! Let your employees know that, so they won’t be as tempted to sneak a drink or two from the bar. If you don’t allow employees free food or drinks, make sure that’s very clear, and that they know the consequences of taking something for free. I have worked in far too many restaurants where there was a “gray area” around free food and drinks, and it led to theft.

Communicate the use of video cameras

If you have surveillance cameras in your restaurant for monitoring theft, make sure the employees know that you check them regularly. You can do this by reviewing the activities you viewed during an employee’s shift. For example, you could congratulate an employee on good customer service, or for doing extra cleaning that was caught on film. This helps positively reinforce good behavior and lets the employees know that you are reviewing the surveillance footage regularly.

These are some easy tips that any restaurant owner or manager can use right away. There are obviously many other ways to prevent theft such as investing in technology systems specific to stopping product theft, or systems that help you manage inventory so that you’re more immediately aware when theft occurs. The most important thing, however, is building a restaurant culture where theft is not tolerated, and the consequences are clearly defined and communicated.

Do you have any tips, tricks, or stories on how to prevent theft in a restaurant? Let us know by commenting below!

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