How “the hand in the till” scenario can tank your business

A hand in the till is bad news for any small business owner…

Employee theft is a pervasive problem that affects small businesses of all types and sizes. According to a recent study by the National Retail Federation, employee theft is responsible for approximately 35% of all inventory shrinkage in the retail industry. This crime is costing businesses an estimated $50 billion annually.

The impact of employee theft is particularly severe for small businesses. This is because they often operate on tight margins and have limited resources to absorb the financial losses. In fact, according to the Association of Certified Fraud Examiners, small businesses are disproportionately affected by employee theft. Indeed, with the median loss for companies with fewer than 100 employees being $200,000 – a significant amount that can spell the end for many small businesses.

It is no wonder, then, that employee theft is ranked as one of the top reasons why so many small businesses fail after only a few years of operation.

The story of Sophia*, with her hand in our shop’s till, and a sad ending…

It is with a heavy heart that we must announce the closure of our beloved family-owned retail store located in the heart of a suburban shopping center. After two generations of business, we were forced to shutter our doors due to the betrayal of one of our own employees, Sophia.

We discovered that Sophia had her hand in the till, stealing from us and our customers. The consequences of her actions were dire, as our cashflow was impacted, and we were unable to pay our bills or purchase inventory.

As a result, we were left with no other choice but to liquidate the business, leaving four hardworking and dedicated employees without a source of income. The impact of this closure extends far beyond just the financial implications. Sadly, it marks the end of a legacy that was built with sweat, tears, and endless dedication.

It is with great sadness that we say goodbye to our cherished customers, employees, and the community that we have been proud to serve for so many years.

So, do you think the “hand in the till” won’t affect your business? Don’t hold your breath…

More about the “hand in the till” problem at small retail businesses

The phrase “hand in the till” refers to the act of stealing money from a business, particularly from the cash register or cash drawer. This type of employee theft can have a significant impact on the cashflow of a small retail business.

Small retail businesses often operate on tight margins, meaning that even a small amount of theft can have a big impact on their finances. When an employee steals from the cash register, the business loses the money that was taken. This can create a cash shortfall, which can make it difficult for the business to pay bills and purchase inventory.

In addition to the direct loss of funds, theft can also lead to indirect costs. For example, the business may need to spend money on extra security measures or to replace stolen inventory. The business may also experience a decline in customer trust, which can lead to lost sales and reduced revenue.

The impact of employee theft on a small retail business can be particularly significant because the business may not have the resources to absorb the loss. Unlike larger businesses, small retail businesses may not have the financial cushion to weather the impact of theft.

To prevent employee theft, small retail businesses should implement a range of security measures. These may include installing security cameras, conducting regular cash audits, and implementing strict cash handling procedures. In addition, the business should ensure that all employees are trained on these procedures and understand the consequences of theft.

It is also important for small retail businesses to foster a culture of honesty and transparency. This can be achieved through open communication, regular training and development opportunities, and fair compensation and benefits. By treating employees well and creating a positive work environment, businesses can reduce the likelihood of theft.

hand in till scenario


If theft does occur, small retail businesses should take immediate action to address the issue. This may involve terminating the employee responsible and reporting the theft to the authorities. It is also important to conduct a thorough investigation to determine how the theft occurred and to identify any weaknesses in the business’s security procedures.

In some cases, small retail businesses may also need to take steps to recover the stolen funds. This may involve pursuing legal action against the employee responsible or seeking reimbursement through insurance or other means.

The “hand in the till” scenario can have a significant impact on the cashflow of a small retail business. Employee theft can lead to a direct loss of funds as well as indirect costs such as increased security measures and lost sales. To prevent theft, businesses should implement a range of security measures and foster a culture of honesty and transparency. If theft does occur, businesses should take immediate action to address the issue and recover the stolen funds. By taking these steps, small retail businesses can protect their cashflow and ensure their long-term success.


In conclusion, the devastating impact of employee theft on small retail businesses cannot be overstated. However, there are technological solutions that can help prevent these “hand in the till” scenarios from occurring.

For instance, implementing a point-of-sale (POS) system with integrated inventory tracking can help businesses monitor sales and inventory levels in real-time. This makes it easier to identify discrepancies and potential theft.

Other solutions such as CCTV cameras, security tags, and biometric authentication systems can also help reduce the risk of employee theft.

By investing in these technologies and implementing strict security protocols, small retail businesses can protect their cashflow. Also, preserve their reputation, and ensure their long-term success. It is crucial that businesses remain vigilant and take proactive measures to prevent employee theft from occurring. Indeed, technology can be a valuable tool in this ongoing fight.

Read also: How to Create a Business Culture of Innovation for Small Businesses


*Fictional name

Feature Photo by Tima Miroshnichenko

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