By Rob Bryer, SVP, Product Management, Balance Innovations
If you ask 100 retailer leaders about their biggest worries, chances are Amazon will come up once or twice. Probably some inventory management concerns and a fair number of omnichannel woes. One thing you probably won’t hear a retailer fretting about is their cost of cash. But they ought to be.
Cash is expensive
It turns out that it’s very expensive to accept and handle cash. A retailer’s cost of cash can run anywhere from 4.7 to 15.5 percent of their annual cash sales, according to a 2018 IHL Group study1, with the average retailer spending nine cents of every dollar just to handle cash. That’s what retailers spend to count, reconcile, track, order, deposit and otherwise manage their cash at the store level. And that’s not even counting costs related to corporate reconciliation and reporting.
IHL Group says that 50 to 80 percent of a retailer’s cost of cash can be cut by reducing labor at the store level. A retailer might look at a stat like that and start thinking about cash-counting devices, smart safes or recyclers. If you just count it faster, you’ll put that money you were spending back in your pocket, right? Wrong.