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How to Prevent Employee Theft

Employee theft is one of the biggest issues for small businesses, franchises, and chain restaurants alike. Owning a business is never easy, so it’s frustrating to have to worry about your own employees.

There are a few different ways employees can steal from their employer. Perhaps the most common cause of business losses from employees is that many employees simply don’t know any better. For example, over-pouring costly alcoholic beverages is technically stealing money from the business, but it is often done accidentally. If you own a bar or restaurant that serves alcohol, be sure to train employees thoroughly and consider adding pour limiters to the bottles.

Unfortunately, there are also many cases of full-blown larceny wherein employees steal cash from the registers or safe.

Whether inadvertent or intentional, here are some tips to help prevent employee theft from being an ongoing issue for your business:

30% of Businesses Will Fail Because Of Employee Theft

Know Your Employees

The simplest way to feel comfortable with your employees when you’re not around is by developing an understanding of the people to whom you entrust your business. Background checks help, but it’s also important to be observant during interviews and the initial trial period of each new employee. Without being too invasive into their personal lives, get to know employees on somewhat of a personal level since there are usually signs to spot people who aren’t trustworthy. If a prospective employee is prone to lying or cheating during the hiring process, it’s likely they won’t hesitate to steal from your business.


This is the best way to go about preventing theft. Being around your business is always a good thing but popping in can be a good tactic. You can see what employees are doing when you aren’t watching. Have more than one person checking on your money also. Your managers should help you out with this part.


Regularly taking inventory of stock, alcohol, and food is important for every business and should remain a top priority. Inventory is especially important for bar and restaurant businesses. As indicated by the earlier example, over-pouring by bartenders is responsible for a high percentage of sales losses at bars and restaurants. Even so, regular inventory counts are also important for retail shops and other business types.


It’s also important to audit your business regularly, whether it is a type or business that keeps physical inventory or not. Don’t wait for corporate or the health inspector. Audit every aspect of business on a regular basis to check sales, promotions, and voids. Those are all areas that more savvy employees with ill intentions can use to steal from a business.


Surveillance systems are undoubtedly the most effective deterrent to employee theft. If your employees know there are cameras watching, they’re far less likely to even try to steal. The newer security systems can be accessed from a mobile phone, so you can directly keep an eye on your business from anywhere at any time. A quality surveillance system gives you the upper hand in every situation related to theft.

Employee theft can be difficult to overcome once it takes root. So, don’t let that happen. Use these recommendations to stop employee theft before it ever becomes a problem.