The retail cash chainThis concept of treating money management of cash like a supply chain is what we like to call the “Retail Cash Chain”. Like any manual system, there are going to be inaccuracies and inefficiencies within it, but with the right care and attention, these can easily be ironed out. One good example of this is the way that bricks-and-mortar retailers manage cash ordering and handling. The more drops, pickups and movements that are made to manage cash within a business, the more disruptive and costly it becomes. Equally, it poses a greater security risk, both from the store associates processing those collections and the security teams delivering and taking cash away to the cash centres. By implementing a robust, automated money management solutionfor cash, cash shrinkage would be reduced for businesses and, in some cases, eliminated. There are two relatively straightforward money management methods to reduce the volume of cash ordering and handling within a retail organisation. The first is better forecasting through greater visibility of their cash positions; if retailers have the foresight to know exactly how much cash they will require on a given day, they can be more considered in their order processes, aiming to reduce the number of interactions without compromising the customer experience. The second way to reduce cash movement within a business is to invest in point of sale (POS) technology with cash recycling capabilities. In addition to speeding up cash availability, making this money invisible to store employees improves security and frees their time to focus on customer service. Another way in which many retailers – particularly those in regions such as the Netherlands and the US – are improving their Retail Cash Chain is by converting cash into electronic payments essentially by freeing the value of the cash from its physical location. If technology and processes can ensure that cash is authentic and secure within the store, then new possibilities are enabled, and cash no longer has to be physically present in the bank to provide the retailer with provisional or same-day credit. One of the essentials for this same day conversion is a secure cash deposit or recycling device in the store, and the ability to send cash holding information to the bank daily, for reconciliation. In return, retailers receive improved liquidity and working capital, and profit simply from having money in the bank earlier.
Cash has a place in the 21st centuryAs these examples show, the combination of technology and smarter working processes are empowering retailers to make cash pay its own way. By viewing the movement of cash through their business as an integrated system, rather than just seeing cash as an old-fashioned and ineffective payment mechanism, they can iron out inefficiencies and make incremental gains across their retail cash chain. Optimising the processing of retail cash can offer some quick wins to businesses, as well as setting them up for a more profitable relationship between themselves, cash and the consumer. And over time, those profits can be used to fund wider business investments. Sion Roberts is EVP of global retail at cash technology expert Glory Image: Shutterstock
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