Magazine Article | November 16, 2006

Minimize Cash Handling Risks

Source: Innovative Retail Technologies

Flying J is achieving faster deposit reconciliation with automated cash handling equipment.

Integrated Solutions For Retailers, December 2006

Flying J Inc., based in Ogden, UT, is a  travel plaza operator with 178 company-owned and franchised travel plazas throughout the United States and Canada. The company is also one of the largest retail distributors of diesel fuel in North America, employing more than 15,000 people nationwide.

“With truck stops, you have a lot of large-dollar purchases in cash, mainly for diesel, since a truck can take 300 to 400 gallons at a time,” says Andre Lortz, Flying J’s retail CFO. “Cash is still very much king in the world of professional drivers, as credit card penetration is less than 10%.”

In 2004, Lortz started looking for technology that would minimize the risks associated with handling cash, as well as maximize efficiencies and stem rising labor expenditures incurred during the cash handling process. At the time, cashiers would, on an hourly basis, remove the bills from their cash drawers, place them in a bag, and turn them over to the dedicated accounting manager in charge of that particular store. Once each day, accounting managers would manually count and reconcile these manual deposits to ensure the amount of money collected matched the totals indicated by the POS system.

“The manual method was far from ideal,” Lortz notes. “Preparing and reconciling deposits took 4 to 5 hours per day, plus about 20 deposit variances were identified across the chain daily.”

Lortz set several requirements for the new solution. Not only would it have to decrease the amount of time and managerial attention required for cash counting and deposit reconciliation and enable secure, efficient cash handling, it had to offer better visibility into the entire scope of cash handling in Flying J’s operations. Lortz also preferred the equipment be configured specifically to meet the needs of operators that regularly accept and handle large volumes of cash. The executive determined that the NKL Bulk Validator from NKL (a member company of the FireKing Security Group) was best suited to Flying J’s needs, especially because it is geared to the truck stop market.

With the new equipment, cashiers perform hourly “drops” of cash collected and insert it into the validator. A currency counter counts the money, and the validator generates a receipt listing the deposit total. Cashiers submit their receipts, along with other paperwork, to accounting managers at the conclusion of their shifts. Meanwhile, at shift cutoff time each day, accounting managers run reports detailing deposit subtotals by cashier. The solution also includes NKL cash dispensers (including coin changing) integrated into a data management software tool called NKL Edge.

Lortz deems time savings the biggest benefit of the validator. Accounting managers are able to complete the cash verification and reconciliation process in about an hour, freeing up more time for cashier training. Additionally, cashiers spend less time putting together and submitting hourly cash drops. “In the past, that job took 10 minutes; now, it takes 60 seconds,” Lortz states. “Cashiers only have to stack the bills, which are automatically fed into the machine. There’s no reason to dawdle while doing this job, and the opportunities for that have been eliminated.”

The system has also made cash verification and reconciliation more accurate than with manual methods. “The accuracy rate is 99.9%,” Lortz asserts. He adds that the validator also supports cash handling accuracy and controls the incidence of fraud by enabling cashiers to automatically detect counterfeit bills. “If, for example, someone comes in and pays for $600 worth of diesel fuel with six $100 bills, the cashier can immediately put those bills through the validator and find out right away if they are legitimate currency,” Lortz explains. “There’s no guesswork involved.”

All in all, Lortz concludes, Flying J is  pleased with the validators. “Some locations have better performance than others but overall, they paid for themselves within a year,” he concludes.              

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