White Paper

Cash Management
in Retail
How retailers can drive higher efficiency and reduce
costs with automated cash handling technologies.
Contents
Introduction 3

Cash is here to stay 4

The cash process in retail 5

Know your cash management risks 6

Retailer benefits using automated cash handling 7

Automated cash handling technologies

Closed cash handling and cash deposit systems 8
Cash recyclers and cash control and reporting software 9

Conclusion 10

References 11

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| Cash Management in Retail
Introduction
For all the discussion about cash disappearing
due to the rise in mobile and card payments,
cash still remains a popular form of payment.
According to the Federal Reserve’s latest
consumer payment findings, consumers
use cash to pay for nearly one-third of retail
transactions,1 making cash handling a critical
part of managing a retail operation.
With its sizeable presence in retail environments,
cash presents significant challenges for retailers.
Business owners and store managers must deal
with not only time-consuming, manual cash
handling processes, but also shrinkage, theft
and robbery on a daily basis.
So, what can retailers do to process cash more
efficiently? How can owners and managers
prevent loss of money at the checkout and in
their cash office? What are some key ways they
can protect their staff, employees and store from
both internal and external threats?
In this white paper, you will see how cash
management technology can help retailers
achieve greater efficiencies and significant
savings through automating cash handling
processes. We will explore what role technology
can play within the cash process and how
retailers can benefit at each step of the way.
Retailers who adopt the right technology will
gain from it through increasing operational
efficiency, reducing costs and improving the
overall customer experience in retail.

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| Cash Management in Retail
Cash is here to stay
Cash will not go away. That’s a fact. Cash has Growth of Currency in Circulation
Growth of Currency in Circulation
been around for 27 centuries and has proved to Volume of Notes by
as Year
of December 31 of each year
be one of mankind’s most successful inventions.
It remains the most used and widely accepted
form of payment in the U.S.

Number of Notes - Billions

As reported by the Federal Reserve, notes in
circulation have steadily grown year over year
since 1999. In 2019, cash represented 47% of
all transactions under $10.00 and 33% of all
those under $25.00.2
While the media recently reported that Covid-19
Source: Board of Governors of the Federal Reserve System, 2019.
may be driving us more quickly towards a
cashless society, the figures do not actually
support this.
Payment Instrument Usage by
During the crisis, the amount of cash people Purchase Amount - 2019
carry increased 17% from the pre-pandemic
amount reported in a 2019 survey by the
Federal Reserve. Cash holdings rose by 71% for
individuals who withdrew extra cash and by 10%
Volume

for those who did not remove more cash.3

Another poll by fintech firm, CoinFlip, found that
many Americans do not want to part with using
notes; 53% of respondents said Covid-19 “had
not changed their cash-carrying habits” and an
additional 15% indicated that the pandemic had Source: Cash Product Office of the Federal Reserve System, 2019.

led them to carry more cash than usual.4

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| Cash Management in Retail
The cash process in retail
As cash accounts for nearly one-third of • Refill cash register drawers when they run
in-person transactions, retailers handle large out of smaller denominations
amounts of notes and coins each day. In order
• Remove excess cash and bring it to a back
to manage the cash, they must perform several office
tasks throughout the day. Cashiers must:
• Deliver deposits to a cash office or the bank
• Validate and count cash into drawers at the
start of their shift Both cashiers and managers count the cash
from the cash register drawer to confirm the
• Handle cash during customer transactions,
while also greeting and assisting customers amount. Counting, validating and reporting are
necessary at each step of the cash process.

A day in retail

START OF THE DAY DURING THE DAY

Preparing the Float: Payment Management: Cash Drawer Refill: Cash Skimming:
Cashiers start their shift by Cashiers accept notes Cashiers often run out of When there is an excess of
counting out a mix of notes and coins, while also smaller denominations cash in the drawer, it is re-
and coins and setting up welcoming and assisting which have been used moved and placed in a secure
their cash register drawers. customers. for change. This creates location, usually a drop safe
downtime. in a back office of the store.

“Both cashiers and managers

count the cash from the cash • END OF DAY
register drawer to confirm the
amount. Counting, validating
and reporting are necessary at
each step of the cash process.”
Cash Transport to Bank: Reconciliation:
Instead of personally taking the Cashiers manually count notes
deposit to the bank, retailers and coins to balance their cash
typically use a cash pickup register drawers. The total
service. amount is deposited in a safe or
delivered to the cash office.

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| Cash Management in Retail
Know your cash
management risks
Time and Costs Shrinkage
For retailers, having to manually count The loss of inventory and cash is caused
cash, replenish cash drawers, perform daily by cash register skimming, employee theft,
reconciliations, balance cash drawers and shoplifting, and cashier or administrative errors.
prepare cash for transportation cost time and The National Retail Federation reported that
money. Administration alone, including the time shrink is at an all-time high. According to their
spent on cash reconciliation, can represent over annual National Retail Security Survey, “Retail
70% of cash management costs. As a result, shrink totaled $61.7 billion in 2019 amid rising
efficiency declines and customer engagement is employee theft and shoplifting,” up from $50.6
set aside. billion in 2018.7 When cash procedures are done
manually and are not tightly controlled, it’s very
Security difficult to track down when and where errors
happen.
Theft and robbery present serious challenges
for retailers. They represent significant costs to
retailers and serious risks to safety. According Control of Cash Levels
to the 32nd Annual Retail Theft Survey Cash management is all about visibility and
conducted by Jack L. Hayes International, control. Knowing how much money you’re
more than 348,000 shoplifters and dishonest dealing with each day at each store location and
employees were apprehended in 2019 by where that money is going is key to successful
21 large retailers who recovered more than management. Managing cash levels and cash
$136 million.5 In 2019, the National Retail processes manually costs retailers significant
Federation reported that organized retail crime amounts of time and money.
cost retailers over $700,000 per $1 billion in
sales.6

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| Cash Management in Retail
Retailer benefits using
automated cash handling
Increased Operational Efficiency
Automated cash management solutions shorten
and eliminate many manual cash handling
tasks, saving retailers both time and money. By
streamlining operations, retailers shorten their
overall cash cycle and cashiers can spend more
time engaging customers.

Higher Security
Minimizing the risk of theft and robbery by using
automated cash handling systems with built-in
certified safes reduces cash access to everyone
involved in the cash cycle. Employees feel safer
and owners have greater peace of mind knowing
they are doing everything possible to protect
their staff and customers.

Loss Prevention
Shrinkage from internal and external theft is
greatly reduced with smart cash management
systems. There is greater transparency with cash
deposits registered from every cashier on every
shift.

Optimized Cash Cycle Monitoring

End-to-end solutions, including hardware,
software and associated services help optimize
cash management security. Cash tracking and
reporting software provides better overall control
and monitoring of the entire cash cycle across
single and multiple store locations.

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| Cash Management in Retail
Automated cash handling
systems
There are several automated cash management
options available to retailers. Understanding the
functionalities of each will help you decide which
ones will best meet your cash processing needs.

Closed Cash Handling Systems

Closed cash handling systems keep cash locked
away from the moment a customer pays to the
point at which it is collected by a pickup service.
These systems are integrated into a store’s
point-of-sale, front and back office processes:
• A payment station at the checkout for notes
and coins which recycles cash as change
and stores larger denominations in separate Closed cash handling system
cassettes
• A sealed cassette (sometimes ink-protected)
to securely transport cash to the back office
• A back-office deposit safe into which the
cassette is inserted and removed by a
pickup service upon cash collection

Cash Deposit Systems

Cash deposit systems, also known as smart
safes, accept, count and validate cash deposits
and generate detailed audit reports of cash
transactions. This saves time on handling cash
and adds a higher level of staff accountability to
the process.
The safes can be connected to a pickup service Smart safe
and bank for real-time monitoring of cash levels.
Provisional credit can be arranged with the bank, Smart safes are designed for retailers of all
where the bank will credit the deposit before the sizes. Compact, under-counter systems
physical cash arrives. This gives retailers faster handle low to mid-volume cash deposit at the
access to their working capital and reduces the checkout. High-speed, large-volume smart
need to make actual deposits at the bank. safes rise in their note capacity and deposit
processing speeds, making them ideal for
back-office operations.

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| Cash Management in Retail
Automated cash handling
systems and software
Cash Recyclers
Retailers use cash recyclers for a combination
of cash deposit and dispense processes.
The system accepts, counts, deposits and
stores cash in a secure certified built-in
safe. Often referred to as a virtual vault, the
system dispenses the stored cash as needed
throughout the day, eliminating the need for
manual cash handling and visits to a cash office
or vault.
Cash recyclers automatically dispense notes
and coins for cash drawers in the morning.
Daily money received is then recycled into the
day’s cash float and any overflow is collected Cash recycler
and deposited in the bank. When cashiers are
running low on a denomination, they can refill
their cash drawers from the back-office recycler.
Detailed audit reports of the day’s cash
transactions are generated for balancing and
reconciliation at the end of the day, saving
significant administrative time and costs in back
office processes.

Cash Control and Reporting Software

Cash control and reporting software provides
online tracking and reporting of cash for single or
multiple cash handling systems.
Working together with your cash management
systems, the software provides a comprehensive
view of cash amounts, sales reconciliation,
collections and deposits to the bank.
Using cash tracking and monitoring, store
owners can optimize cash flow planning across
multiple retail locations, while store managers
and financial staff can better manage daily cash
levels within their individual store operations.

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| Cash Management in Retail
 Conclusion
Cash continues to be a payment of choice Retailers should consider cash handling
among consumers. In fact, it remains one of the technologies as part of their cash management
most popular forms of payment in the U.S. strategies to reduce costs and drive business
profitability. There are several cash handling
With clear demand for the usage of cash for options for the front and back offices to drive
payment transactions, retailers are challenged efficiencies across retail operations.
with managing cash across their operations.
This brings with it several challenges, from Cash management technology solutions, such
administrative costs and shrinkage to theft, as closed cash handling systems, smart safes,
robbery and controlling cash levels in stores. cash recyclers and cash tracking and monitoring
software can all improve accuracy, efficiency and
By automating the cash handling process, cash flow for your business.
retailers can reduce the time and resources
spent on counting and recounting cash, taking But it is essential for retail owners and store
it to a vault and transporting it to the bank. managers to assess their current cash
Having an automated cash management processes and consider which cash handling
process keeps cash out of reach and increases technologies and implementations are feasible
the store’s overall security. It prevents mistakes and best meet their needs. Choosing the right
and helps detect suspicious behavior. Cashiers, automated cash management solutions for your
finance staff and store owners can keep track front-office and back-office operations will be
of every operation and carry out cash audits key to your business success.
quickly and efficiently.

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| Cash Management in Retail
References
1 Federal Reserve, (2020). 2020 Findings from the Diary of Consumer Payment Choice Study-2019,
https://www.frbsf.org/cash/files/2020-findings-from-the-diary-of-consumer-payment-choice-july2020.pdf

2 Federal Reserve (2020). Currency in Circulation: Volume, https://www.federalreserve.gov/

paymentsystems/coin_data.htm; 2020 Findings from the Diary of Consumer Payment Choice Study-2019,
https://www.frbsf.org/cash/files/2020-findings-from-the-diary-of-consumer-payment-choice-july2020.pdf

3 Federal Reserve (2020). Consumer Payments and the COVID-19 Pandemic: A Supplement to
the 2020 Findings from the Diary of Consumer Payment Choice, viewed December 2020, https://www.
frbsf.org/cash/publications/fed-notes/2020/july/consumer-payments-covid-19-pandemic-2020-diary-
consumer-payment-choice-supplement/

4 CoinFlip (2020). Cash Remains King: Despite Pandemic Panic, Americans Aren’t Ditching Their
Dollars, press release on Cision PR Web, viewed November 2020, https://prweb.com/releases/cash_
remains_king_despite_pandemic_panic_americans_aren’t_ditching_their_dollars_/prweb17335618.htm

5 Jack L. Hayes International, Inc. (2020). 32nd Annual Retail Theft Survey, viewed November 2020,
https://hayesinternational.com/news/annual-retail-theft-survey/

6 National Retail Federation (2019). Organized Retail Crime Survey, December 2019, https://cdn.nrf.
com/sites/default/files/2019-12/NRF%20ORC%20Survey%202019.pdf

7 National Retail Federation (2020). 2020 National Retail Security Survey, July 2020, https://cdn.nrf.
com/sites/default/files/2020-07/RS-105905_2020_NationalRetailSecuritySurvey.pdf; press release on NRF
Media Center, viewed November 2020, https://nrf.com/media-center/press-releases/retail-shrink-totaled-
617-billion-2019-amid-rising-employee-theft-and

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| Cash Management in Retail
About Gunnebo
Gunnebo is a global leader in the retail cash management industry. Throughout the years,
retail has been one of our major focuses. This has given us the knowledge to understand
the retail cash process in small, mid-size and big stores, and improve the experience for
every player in the cash cycle, from cashiers and managers to pickup services and banks.
Today, we have more than 35,000 cash solutions operating all over the world.

Gunnebo’s solutions are adapted to different retail processes, from convenience stores, fast
food outlets and supermarkets to shopping malls and entertainment venues. We provide
products, software and services for closed cash handling, cash deposit, cash recycling,
coin roll dispensing and cash tracking and reporting. In the U.S., our solutions are sold and
serviced through a network of Hamilton Security channel partners nationwide. To talk with
an expert, call 513.874.3733.

Hamilton Security
7775 Cooper Road, Cincinnati, OH 45242
Tel 513.874.3733. www.gunnebo.us