This article is brought to you by Cash Depot.

“It’s no secret that people used cash less and credit cards more in the early days of Covid,” said Sean Burke, the CEO of Cash Depot. “But that trend quickly leveled off.”

According to the Federal Reserve, over the past three years, cash has consistently accounted for about one in five transactions in the United States. Not surprisingly, about one in five Americans say cash is their preferred method of payment when they shop in-person.

Four percent of Americans say they have stopped using cash, with another 3% of Americans planning to eventually drop cash. That means a full 93% of your customers expect to keep using paper money indefinitely.

Cash has a substantial benefit: No swipe fees attached. “Retailers are all too familiar with credit card swipe fees,” Burke noted. These swipe fees cost the convenience store industry almost $20 billion in 2022.

Although cash has costs, too, “the good news is that it’s possible to control these costs,” Burke said.

According to Burke, the three main ways that cash costs retailers are:

• Labor. This includes paying cashiers to count their drawers, but the cost extends up the organization as managers and others spend time on bookkeeping. Cash Depot research shows that manual cash management for a c-store can require about 20 hours of labor each week at the store level. That means a single location can spend more than $1,000 each month managing cash.
• Bank fees. Financial institutions are charging more for cash handling, with some even charging up to $0.25 per $100 over $5,000. “Retailers don’t need the extra hassle of finding the right bank that will accept the right amount of cash the correct number of times” to avoid fees, said Burke. Some retailers have moved towards using armored carriers, which can remove the worry about bank fees, but then they face the cost of about $60 per pick up.
• Crime, both internal and external. “A simple, practical way to limit exposure to crime is a cash management system that limits cash availability in the store. These systems can automatically count, verify and record the store’s funds,” Burke said, “but otherwise keep it safely tucked away for deposit.”

“A strong cash management program has many benefits. Containing these costs is one of them,” Burke said.

This is the first of a two-part series on cash management systems. Learn more about Cash Depot.