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Since cash remains the most preferred payment method in South Africa by a long shot, we are seeing an ever-growing shift from manual cash handling to the adoption of automated cash management solutions in retail, wholesale and logistics sectors of our economy.

This shift in moving from traditional methods of counting, re-counting and reconciling of cash to using technology to secure cash in the business, is an important and logical decision, particularly in the face of high levels of violent crime we have become accustomed to. However, because the need to try and deter and deflect crime from the store has been front of mind for most retailers, the immense value that automation brings to operational efficiencies and cost savings are often missed. Business efficiency is a deliverable that can be measured where automated cash management is practiced in the store.  

Courtesy of Cash Connect, SA’s leader in automated cash management and payment solutions, here are a few simple tips you can follow to ensure that your cash management solution fulfils the role it should by adding value to your business and most of all providing a secure trading environment, for both your staff and customers:

Reduce cash shrinkage and shortages

Manual cash handling is expensive and so is cash deposit fees, insurance, cash shrinkage and shortages.  

DID YOU KNOW? The average for cash shrinkage is 0,15% of your cash turnover. If a business has a monthly cash turnover of R1m, it means that they could lose on average, R18,000 per year – just on unseen cash shortages.

European studies indicate that retailers’ average shrinkage amounts to 0.15% of cash turnover between receipt at the till and value in the bank. Because cash shrinkage remains obscured by the many hands through which it passes from till to bank, the extent of the shortfall is more often than not, under estimated and consequently overlooked.

Automation identifies the till operator, date, time and value of each deposit made. This removes the ‘third party’ element and allocates accountability to the till operator directly. The opportunity for ‘shrinkage’ is largely eliminated and contained to the till reconciliation.

Avoid double counting, cash deposit fees and the cost of funds

DID YOU KNOW? An automated cash management and payment solution is up to 4 times faster than a manual cash handling system. Business owners can save up to 50% of their business day, as they no longer have to count the cash, spend hours on recons and preparing bank deposits.

The cost of having to keep a dedicated or partly dedicated back office supervisor employed to receive takings from the cashiers, count and verify them every time and then bulk and recount as part of preparing a bank deposit is in itself an overhead that can be dispensed with in a typically automated environment.

What would you do with an extra R8,000 a month or so? You can save that by simply cutting out back office overheads or redeploying it more effectively in the business.

Business owners should consider the cost and risk that traditional cash handling processes pose. The traditional way of manual cash handling produces a greater margin of human error while valuable man hours are lost in the process of trying to keep the custodians of the cash honest.

An automated cash management system reduces your back office costs and allows you to deploy your staff to more productive roles within the business – a tangible way to improve business efficiency.

More so, cash deposit fees for over the counter deposits are high, not to mention the risk and time associated in taking the cash to the bank and standing in a queue before finally being relieved of the risk.

Automated cash deposit vaults are equipped with high-speed and reliable, banknote validators that confirm the authenticity of the banknote and capture its denomination and value. The process affords the service provider the ability to supply the banking system with high quality currency which goes some of the way towards reducing the cost of recycling in the broader economy. The cash deposit cost to the retailer is consequently materially reduced by automation.

Improved cash flow and cost of funds savings

DID YOU KNOW? At a prime rate of 10,5%, the saving arising from same day value on a daily cash deposit of R60,000 amounts to R6,300 a year.

Any business owner wants peace of mind and cash flow certainly provides that. More importantly it is advisable that the provider of the cash management solution offers you the benefit of fast cash settlement that will improve your cash flow.

Manual banking generally provides value on the second or even third day from the deposit. Reputable automated cash management services offer value in the client’s bank account on the same day. The cost of funds saving at prime should reflect on the bottom line, so as not to lose out on any interest on your funds from the time you make the deposit to the time the value reflects in your account. This certainly will allow your business to operate more efficiently.

Immediate risk transfer

DID YOU KNOW? There is a cost for in-store insurance which could be separate from the cost of Cash-in-Transit insurance. In addition, insurers sometimes impose an inner excess per event and even an annualised aggregated cap on the total cash loss claims.

Imagine from the moment you drop your cash into the cash vault and until the value reflects in your bank account, your cash management service provider takes the risk. Your cash is guaranteed. It’s like the bank has been moved to your store. That is the kind of value you need to receive!

How much more peace of mind would you, as the business owner, have if you no longer had to pay to protect your cash in-store or whilst it is in transit to the bank, because your service provider has got you covered? All you need to do is focus on running your business. That is business efficiency.

Cash on Delivery – redefined

Opt for a hassle-free solution that offers you the ability to pay your suppliers straight from your cash vault via a secure online portal with no need to keep large amounts of cash unsecured on your premises for COD deliveries – a feature that saves time, and offers efficiency and improves the safety of your staff, your customers and your business.

Multiple business access

DID YOU KNOW? Modern advances in cash automation provides you with the ability to share the cash vault and supporting services with your business neighbours, drastically reducing the cost of service while retaining complete independence of cash risk and same day value transfer.

No matter how small your business is or how low your cash volumes are, the point is you are still trading with cash. And where cash is, there will always be a risk for cash-related crime. If the cost of a dedicated solution is too high, why not share?

Opt for a solution that offers shared services for smaller businesses with lower cash volumes, where one cash vault serves multiple retailers in close proximity to each other. A shared cash vault automatically includes a shared Cash-in-Transit service and all the benefits of access to a separate and dedicated online portal which is password protected that allows you to view and manage your account online.

Although the world is encouraging mobile and electronic transactions, it is a fact that more than 80% of transactions are still done with cash. This automatically creates a risk for crime and makes businesses vulnerable. Now even smaller businesses can enjoy savings and be more secure with a shared cash vault.


ABOUT CASH CONNECT

Cash Connect Management Solutions offers an end-to-end cash management and payments solution that encompasses cash in transit logistics and cash processing. Established in 2006, Cash Connect’s specialist solutions for retailers remove risk and maximise cash flow through swift settlements.

Cash Connect is one of the largest suppliers of cash to the banking system and boasts over R50 Billion a year that it manages on behalf of its diversified client base across the country. It is an approved service provider to blue-chip companies such as Spar Group, Shell, Engen, Pick ‘n Pay and OK to name but a few.

The executive management team - led by joint CEOs Richard Phillips and Steven Heilbron - has an unrivalled pool of specialised cash logistics, security and banking experience. The board of directors is chaired by Ivan Epstein, former CEO of Softline and Sage International. 

Cash Connect is a private company, with Old Mutual’s specialist fund, Futuregrowth Asset Management, as its largest institutional shareholder.

Celebrating its 11th anniversary in 2017, Cash Connect believes that businesses deserve to trade in a safe environment, allowing retailers to do business efficiently and securely.

IDEA ENGINEERS ON BEHALF OF SUMAY HERBST: CASH CONNECT
Tel: +27 11 010 4300 / 083 286 2799
Email: sumayh@cashconnect.co.za
Web: www.cashconnect.co.za    

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