It's hard to say how much return on investment (ROI) you will get from increasing your security. Many restaurant owners are not motivated to make changes unless they can see what the gain might be in dollars and cents. Through our research, we found some general numbers to help you determine your ROI.
Many security professionals say implementing an advanced POS system results in a nearly 10% revenue gain. How? POS systems can improve inventory accuracy and create correct sales tickets. Security cameras tend to add 3% or 4% more improvement.
These numbers may not reflect your experience, but you can likely expect a 10% boost in revenue by investing in your restaurant security. If you're not sure, compare the cost of a new POS and camera system with anticipated savings to gauge whether or not the investment makes sense for you.
Some experts say you'll realize your ROI within a year; others say six months. Your experience will vary.
The importance of securing your restaurant
Increasing your security should be a top priority for your restaurant to meet the goal of creating a safer atmosphere for both your customers and employees. Security features deter theft and other potential crimes, both during and after business hours. Having greater security also gives your restaurant a chance to respond to any problems such as stealing, threats, or customers who dine and dash.
It's crucial for your employees to feel safe going to work and for customers to feel secure while dining at your establishment. Enhanced security helps make this possible. Even straightforward solutions, like installing an alarm or better lighting, can go a long way in deterring and responding to any safety threats.
Additionally, a bouncer can deter violent altercations and video cameras can keep an eye on your restaurant's assets. Whatever your budget and preferences, securing your restaurant is an investment that will pay off in the long run.
Checklist for keeping your restaurant secure
Take these steps to keep your restaurant as secure as possible:
1. Invest in technology.
Most restaurant security professionals recommend two technologies to help you protect your assets and profits: an advanced POS system and a security camera system. If you can afford it, a POS system that integrates with your camera system is ideal.
Restaurant POS systems
A capable POS system can control loss by tracking sales, inventory and employee hours.
- Sales tracking: Most business owners report a noticeable increase in sales and improved inventory accuracy after purchasing a new POS system. In addition, you can easily run customized sales and inventory reports to identify sales trends, busy hours, high-selling days and so on. Some systems even provide reports that flag potential fraud issues, such as a routine excess of voided sales.
- Inventory tracking: An accurate inventory not only helps you with food prep and ordering, it also helps detect employee theft. Many restaurant owners still track inventory by other means or even by sight, which is rarely accurate. A good POS system, on the other hand, can track food inventory by ingredient and recipe; account for waste, loss and spoilage; and manage vendor information, delivery dates, and bulk or catering orders.
- Employee scheduling and time clocks: POS systems can improve payroll accuracy. Some systems even support biometric technologies to prevent employees from clocking in for each other. Others capture an image of your employee as they clock in. You can also post schedules online and send shift changes to your employees via mobile phone.
If you are interested in learning more about some of the top POS systems for restaurants, read our review of TouchBistro and our Toast review.
Editor's note: Looking for the right POS system for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.
Security camera systems
Security cameras not only help deter theft, but they can also help substantially with potential liability or harassment issues as well as training or performance problems. Modern camera systems include innovative features and tools, and their clear video footage is viewable on your smartphone.
Here are a couple of ways to use security cameras to your advantage:
- Overseeing critical locations in your restaurant: Place cameras by all entrances and exits, over cash registers, throughout the dining room, in the bar, and anywhere you store expensive inventory. Of course, you cannot install cameras in bathrooms or locker rooms, but anywhere else is allowed.
- Monitoring good behavior: Make sure your employees know that you review the recordings and can see live feeds on your phone, but don't make this only about punishing infractions. Reward employees you see performing well on camera as well.
Integrated POS and security camera systems
Some security systems integrate with your POS system and offer greater insight and security for your restaurant. For instance, these systems link transaction times with video-recording times, and they include theft-detection technologies.
You no longer have to review hours of video to find a specific incident. With an integrated system, you can search by sales transaction to find the section of the recording where the incident in question occurs. Many systems also include behavior-detection features that can alert you if the software detects a possible issue.
POS and security camera systems can be purchased together. Some companies offer compatible software that connects to your POS and surveillance systems to provide these functions.
Advanced security options
These are some advanced security options you can implement to keep your restaurant and employees safe.
- Biometrics: This technology is increasingly affordable. Some POS systems use biometric information, usually a thumbprint or fingerprint, to grant access or login. Rather than using a PIN or password that can be shared, biometric identification monitors people who log in to the POS system and access the cash drawer. It can also be used to log in employees. Another plus – you don't have to bother with passwords, key fobs or cards.
- Forensic property marking: Although this technology is not often used in restaurants, it can be. It links to your security system, and when an alarm is triggered, it sprays a forensic chemical onto an intruder. The sprayed particles are only visible under ultraviolet light and can be used to identify intruders later.
- Employee image capture at clock-in: Many POS and time-clock systems capture images of employees as they clock in and out. This lets you know who worked when, and deters co-workers from clocking in for each other.
- Freezer and refrigerator monitors: Storing perishable food at the proper temperature lowers the risk of foodborne illness and decreases inventory loss. Installed temperature monitoring systems can alert you by email, text or phone call if your equipment fails. Systems are wireless and simple to install, and they provide audit records for local health inspectors.
You can better protect your employees, patrons and assets through simple and affordable security tactics. Most restaurant owners see an increased profit and ROI by making a few changes. If your restaurant is barely holding on, your profits might be walking out the door without your knowledge. Implementing good security practices protects your team members and boosts your profit margin.
2. Adopt credit card and fraud protection.
Credit card scams and fraud issues are still common, despite advancements in technology. Under new liability laws, merchants can be held liable if their security is not up to date, so due diligence is essential.
While you should consult a security specialist for additional assistance, here are some things you can do to increase your security:
- Employ a top-of-the-line POS system with secure credit card processing.
- Upgrade card readers to EMV chip-and-PIN card readers.
- Lock down Wi-Fi access and install a powerful firewall.
- Provide tableside processing so customers' cards never leave the table.
- Utilize a cardless tab system such as TabbedOut.
- Limit who processes credit and debit card transactions.
- Consult a specialist on how you can become and stay PCI compliant.
- Maintain good records and be prepared for a security audit should it occur.
- Never store customers' credit card information.
- Employ strong passwords that you change often.
- Use highly rated business antivirus software.
3. Select a secure safe.
Restaurants can be easy targets for thieves because they typically keep cash on hand. Protect cash and valuables with a heavy-duty safe.
Select one that's as heavy as you can afford, and make sure it has a drop feature so employees can't access the inside. Hire a locksmith or other professional to install the safe, and bolt it down in a visible place. Your first instinct may be to hide it, but experts agree that visibility deters theft.
A safe can be costly, but it is an important investment and should last for years.
Choose the best lock for your needs.
One common question for restaurant owners is which type of lock to use. While many people like the convenience of an electronic lock, a mechanical lock does not need power to operate, and it is impervious to electromagnetic pulses. On the other hand, it's easier to change the combination of electronic locks. Mechanical locks have to be changed by a professional locksmith.
You can opt for a redundant lock safe that includes a mechanical and an electronic lock. That way, you can use the mechanical lock if the electronic one fails, but you can also enjoy the convenience of an electronic lock as long as it's powered.
Consider temperature requirements.
Safes are rated for security, fire, construction and performance. You may be able to lower your insurance rates by purchasing a higher-rated safe. Ask your insurance company what its safe-rating requirements are.
Construction scores for safes rank from B to G, with G being the best. Performance ratings are a mixture of letters and numbers. For example, the TXTL-60 is among the highest ratings.
A good business safe can maintain a temperature under 350 degrees Fahrenheit for four hours when exposed to high temperatures, often up to 2,000 F. Purchase a safe with the highest temperature rating you can afford in case of fire.
Make sure your safe is rated for business use – don't try to buy a lower-priced, home-use safe instead. A professional locksmith can help you choose the right safe for your restaurant.
4. Manage employee theft.
How employees steal from your restaurant
Many restaurant owners and managers have difficulty believing that their employees are skimming assets from their restaurants, but it is more common than most would like to believe. Theft could be as simple as an employee eating a free meal without permission or as nefarious as not recording cash sales and pocketing the cash.
Craig A. Whitfield, author of Guess Who's Eating Your Profits, wrote that managers assume a certain amount of loss from employees in many cases. Some, however, refuse to believe that even their best employees might be stealing from them.
While owners and managers shouldn't create a suspicious and hostile work environment, it helps to know the ways that employees might pull profits from the company. Most theft is minor, but it adds up over time.
Here are a few ways employees may be diverting profits from your business:
- Short-ringing: An employee takes cash for a high-priced item but enters it into the POS system as a lower-priced item and pockets the difference.
- Food theft: An employee eats or takes home food, or gives free food items and drinks to friends. Another common tactic is overpouring drinks to entice higher tips.
- Voided transactions: Either during the day or at the end of the night, an employee voids out a few transactions and pockets the cash for those sales.
- Falsely reported dine and dashes: An employee falsely reports that a patron did not pay their tab or food order, and the employee pockets the money.
- Tip raising: The employee adds to the tip, often after the patron signs for the transaction. Most patrons don't notice the difference or don't notice until they see their bank statements.
- Short pours and watered-down drinks: Bartenders have been known to underpour drinks and pocket the difference. Some even bring in their own bottles, sell straight from the bottle, and take the profit.
Implementing a sound POS system, tracking inventory accurately, and providing ongoing employee training can squelch employee theft.
How to handle employee theft
What should you do if you discover a trusted employee has been stealing from you? This can be difficult to handle, depending on your state and local hiring and firing laws. Make sure you comply with employment requirements to avoid a wrongful termination lawsuit or other issues. Collect all the evidence you can to prove the theft.
- Get a consultant. If you don't feel comfortable confronting the employee, invite a consultant or security expert to assist with the conversation. It's always a good idea to have another individual present in these types of conversations. Ask the employee to explain the discrepancies and have them put their statement in writing.
- Request repayment immediately. Loss prevention specialists suggest that you request the employee repay you for the loss as soon as possible. If it is a large amount, you may have to involve the local police. Consult with your local laws to see whether you'll need to involve local law enforcement. Maintain your professionalism, regardless of how betrayed and upset you feel.
- Include loss prevention in employee job descriptions. One preventative measure is to make inventory and cost control part of the employee's job description. For example, you could require that your bar manager be responsible for maintaining an accurate liquor inventory or that your head chef is accountable for food and kitchen inventories.
- Communicate expectations. Create clear written expectations, provide training, and check in with employees about inventory monitoring. If you continue to have inventory losses or sales discrepancies, you can discontinue their employment for performance reasons rather than accusing them of theft.
5. Increase employee satisfaction.
Employee theft in restaurants is higher than in other industries. There are many reasons for this: low wages, "us vs. them" attitudes, simple opportunity, a high volume of cash transactions, addiction problems and more.
While some owners and managers may be tempted to act harshly to deter theft, some security and management professionals recommend a dose of generosity instead. Employees who feel squeezed to their limits are likely to react in negative ways. In addition, customers notice when employees are unhappy, which can quickly empty your restaurant.
Here are some low-cost ideas to keep your employees satisfied and less inclined to take from you:
Feed them.
Many owners and managers offer low-cost meal options. However, many restaurant workers cannot afford items on the menu, which fosters resentment. Many employees might be tempted to steal food, and they might actually be hungry, so feed them. Of course, that doesn't mean giving them unlimited access to meals, but you can create a meal plan that works for everyone.
Provide free soda and coffee.
Employees may sneak drinks when you're not looking. Soda and coffee are low-cost perks you can provide to employees while they are on shift.
Offer random incentives and bonuses.
Be creative with employee incentives. Some managers watch the video feeds and monetarily reward an employee who shows exceptional service. You could hire "secret shoppers" to visit your restaurant to test food quality and service. Employees who perform well could earn a reward, such as money or a free high-priced menu item. Hold team contests, such as a reward to whoever sells the highest number of featured menu items. Don't forget to reward your back-of-house workers as well.
Get your hands dirty.
Jump in and help out when you can. Not only will the experience help you improve processes, but it also demonstrates to your employees that you're a team player who isn't afraid of a little hard work. You'll get more respect from your employees if you know how to do their jobs and understand what they do on a regular basis.
Create a nice break space.
Set up a temporary oasis for employees – outside and inside. An indoor and outdoor haven gives your employees a relaxing place to spend their breaks.
Seek input from staff members.
Employees who feel you're attentive to their concerns and are serious about making improvements are more motivated to care about your business. Encourage their input about processes, menu items, specials, events and more. Ask them what equipment improvements might be necessary. They likely have some excellent ideas that can easily be implemented.
Strive for work-life balance.
Restaurant hours can be long, making it hard for people to manage their personal affairs, and scheduling is sometimes a challenge. With a capable online scheduling system, a feature of several POS systems and employee time-tracking software, you can allow employees to trade shifts or request time off online or via their smartphones. This technology lets your employees better plan around their important life events. In addition, using POS sales data, you can create a more efficient schedule so you're not overstaffed or understaffed.
No-cost restaurant security practices
Yes, cameras and POS systems can be expensive, but you can take a few other precautions to improve security without spending much money.
Here are a few precautions that security experts recommend:
- Regularly change the alarm and POS passwords and codes.
- Clear entrance areas of foliage that someone could hide behind.
- Keep lights mounted high and bulbs out of reach so intruders cannot tamper with lights.
- Vary the times that you deposit funds at your bank, or hire an armored transport service.
- Record information and photograph expensive equipment. Store the data off-site.
- Create an emergency preparedness plan and keep your first-aid kit stocked.
- Keep parking lots well-lit and have employees leave the building using the buddy system.
- Create a no-theft honesty policy that your employees sign when hired.
- Check the references of potential hires.
- Check bathrooms before closing.
- Use clear garbage bags so employees cannot easily remove items from the restaurant.
- Encourage employees not to bring valuables or large sums of money to work.