Regression Analysis of your Sales and Inventory Can Detect Thefts
Today, more than ever, employee theft has become major problem throughout the country for small businesses. Business owners, faced with long workdays don't have the time to watch over these employees to make sure that there is no pilfering going on. You may even have another full time job where this business is a side venture for investment purposes. Well, simple internal control procedures can stop employees from stealing money and property from your business. Internal controls are simple policies that segregate duties and implement safeguards that make it harder for employees to steal. Often, when strict internal controls are implemented and working properly, it takes collusion between two or more employees to facilitate a theft scheme.
Inventory
Inventory theft may be a major problem in your business without you being aware of it, because it is one of the most difficult employee type thefts to control.
1- Out the back door of your bar or restaurant: This type of theft is the most common where there is no supervision or controls in place.
2- Employee skimming: Sales never hit the register, but the food or liquor goes out the door.
Solution
Inventory thefts can be detected with the application of a financial analysis of your sales and inventory purchases. Accordingly, your business model will follow certain predictable patterns that can be either compared to other store locations or just the historical sales history of one store. These patterns are shown on a simple graph using regression analysis and will effectively estimate the time, amount and dollar value of the thefts to a surprising level of accuracy.
Shifting employee work schedules after such an analysis can help you identify certain employees that may be stealing from you. This process if fairly inexpensive and can provide great benefits to a business owner. Contact me for more information