Ask TrueGuest: How Does Using Table Numbers Improve Internal Controls and How Do I Assign Table Numbers?

Dear TrueGuest,

I read a couple of articles on your site about using table numbers to reduce employee theft.  How does that work?  Also, how do I assign table numbers in my restaurant?

Tables

Great question!  Using table numbers is not only a key tool for guest service, but a great tool for reducing internal theft.  However, judging by the receipts we see in hotel restaurants, very few hotels take advantage of using table numbers in restaurants or seat numbers in bars.  Why does using table numbers help reduce internal theft:

  1. Using table numbers makes it easy for a manager or supervisor to monitor an employee’s open checks.  As a manager, I used to stop in the restaurant often and pop open the floor plan on the point of sale system.  Anytime I would see an open check at a table without anyone sitting at, I knew there was a problem that needed to be investigated.  My policy was always that checks must be closed as soon as payment was made.
  2. Using table numbers and seat numbers makes it hard for servers and bartenders to reuse checks and steal the cash.  We’ve written quite a bit in the past about problems with servers and bartenders reusing checks.  See this article on check splitting and this section in our internal control guide for bars on reusing checks.  If your restaurant and bar have good table and seat number systems, it is more obvious when servers and bartenders reuse checks.  For instance, if a guest at table 22 pays cash for their buffet, the server cannot easily reuse that same check with table 34.
  3. Using table numbers and seat numbers also adds another layer of perceived controls.  It seems simple, but the more controls you have in place, the less employees will test them.  Experienced servers and bartenders know that restaurants who do not have simple controls like table numbers in place probably aren’t doing a very good watching out for internal theft.

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WSJ Reports Businesses See Rise In Employee Theft

WSJ-LogoThe Wall Street Journal posted a great article on the rise of employee theft as a result of the recession.  You can read the entire article on MSN’s Money page here.  The article reports that ‘New research shows that employers are seeing an increase in internal crimes, ranging from fictitious sales transactions and illegal kickbacks to the theft of office equipment and retail products meant for sale to customers.’  The article also mentions that ‘To many employers’ chagrin, the workers guilty of the most grandiose theft frequently turn out to be those deemed to be highly trustworthy’.  Don’t let this guy work for you!

We have seen a dramatic increase in internal theft while in the field and expect to see a continued increase in 2009, especially in employees who rely on tips for a large part of their salary.  Many hotels have been forced to dramatically reduce the number of hours as occupancy declines and many of the hotel restaurants have slowed down.  Many employees are now really struggling to make what they made in the past and most cannot afford to take a pay cut and still pay their monthly expenses.     Continue reading

The McScam

It turns out that hotels are not the only victims of crafty employee theft.  Here is the fast food version of the breakfast buffet scam:

I was  in West LA last weekend and had time to get a quick bite to eat with some friends.  Most convenient, of course, was a major fast food restaurant down the street.  Some of us were not very hungry, so the ones who were ordered first.  Everything was normal at first; we ordered food that the cooks in the back had to make, the cashier entered the transaction into the computer, processed the payments, gave a receipt, etc.

scamThen the ones that just wanted small items came to place their orders.  As I waited for my food to the side, I noticed that she started to use a small calculator instead of the register that she had used with me to add up the cost of each order.  One of my friends ordered a drink and large fries (both items the cashier could retrieve herself).  She punched the amounts into the small calculator  and asked for $2.79.  My friend payed with cash, the cashier put the money in the drawer, did not present a receipt, and provided the drink cup and fries.  Another one of my friends ordered a specialty coffee drink.  The cashier listened to the order, then asked, “That’s it?”  Once my friend nodded his head, she then recalled the price from memory and asked for $2.19.  She then did the same with the money as the previous transaction.

There was a good flow of people coming in to order food and as I waited for my food, I could not help but laugh.  Every transaction that she did not have to send to the cooks or have to process a credit card, she would not ring the transaction into the register.  One can only imagine how much money this cashier was making, but even worse, how much more money the fast food restaurant was losing.  She obviously had been doing this for some time and because the restaurant was in a very high volume area, the managers or owners probably do not even notice.

Take it from me, she was being so obvious because she knows that she probably won’t get caught.  These things happen often in places I go.  Managers and owners just need to take a closer look at their operation.

Got a McStory to share?  Post it in our comment section.

Servers and Bartenders Split Checks (and steal) in a Blink of the Eye

It never amazes us to hear about all of the ways our Mystery Shoppers see servers and bartenders stealing from their hotels. With the advancement in technology, especially point of sale systems, you would think that it would be harder for servers to steal. However, in many ways, it actually makes it easier.

micros1_fullWith the advancement in technology, a server can make a guest check in seconds. That means they can easily manipulate a guest check in seconds. Here is one example our Mystery Shoppers see. A server serves 2 breakfast buffets and presents check number 101 to a customer. The customer pays $40 cash. Instead of closing the check to cash, the server pockets the cash and goes back and splits that check and creates check number 102 for 1 buffet and check number 103 for 1 buffet. Now the server has two open checks for very popular items that he/she can do many things with. He/she can present a check their next customer who orders a buffet or they can add additional items to the buffet or transfer it to another guest check. The opportunities are endless.

This not only works with buffets but with any items that are not prepared by the kitchen such as beverages, deserts, and especially alcoholic drinks.

How can you protect your restaurant?

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Restaurant Menu Engineering

menuTake a break from working on your budget to catch up on a new law that will have a huge impact on your gross operating profit . As you may have already read, on September 12th, 2006 Governor Schwarzenegger approved a bill to increase the minimum wage. The bill calls for two raises to the minimum wage over the next year and a half as follows:

-On January 1, 2007, the minimum wage for California will increase from $6.75 per hour to $7.50 per hour.

-On January 1, 2008, the minimum wage for California will increase an additional 50 cents to $8.00 per hour.

To read the bill, click on the following link: http://www.dir.ca.gov/IWC/iwc.html

The biggest area the new law will impact is in the hotel’s food and beverage departments. Most restaurants only make a profit of about 10 percent. With server and bartender labor to increase 11 percent to $7.50, it could easily squeeze out the entire profit. Hotels with high benefits (especially high workers comp rates) will be hit the hardest. Now is the time to examine your menus and consider any price increases. There is a great article on menu engineering available at http://www.restaurantowner.com/public/330.cfm . There is also a menu engineering worksheet available for download to help you out. It is also a great time to examine your labor productivity. Make sure that you have a productivity number for each position and those numbers are used to forecast, schedule and report each week.

The earlier that you can prepare for the increase, the easier it will be to absorb the expense. It is critical to examine what positions that it will affect and have a plan for them. Typically any position under $10.00 per hour will be affected by this minimum wage increase. You may want to consider raising the wages on those positions immediately rather than waiting until January 1st. As the word about the minimum wage increase gets around, employees will start looking around to see what other hotels are paying. The hotels who wait until January 1st could risk losing some good employees to their competitors. Also, a large increase before the government requires could be a great boost for moral, especially in December when hotels are slow and work is scarce.

Link provided with permission from RestaurantOwner.com. For more information, visit http://www.restaurantowner.com/.