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Deri Green, Director of Newbridge Software talks about shrinkage in businesses and how to manage it better

“Fraud (or shrinkage) has always been an issue across the spectrum within the Hospitality sector. A typical hospitality business will make between 5% – 10% net margin, yet recent studies show that fraud, both internal and external can range between 3% – 8% – often driving businesses in to an operating loss. Having worked in bars and restaurants myself, I have seen lots of different types of internal fraud taking place including:


  • A high turnover of staff creating a situation where low level stealing is easy and becomes normalised behaviour.
  • Cash heavy transactions making it easier for staff to give friends discounts or freebies without feeling like they are being fraudulent.
  • The same situation allowing bar staff to accrue cash over a shift through hiding transactions.
  • Misuse of loyalty schemes.


The majority of staff I’ve worked with have been trustworthy, but unfortunately with the high turnover within hospitality, there always seem to be those who are less honest. Fraud from staff that I have experienced has ranged from ID fraud to get a job in the first place to manipulating data to hide theft.


Having sophisticated EPOS software like Newbridge’s software’s can really help manage any shrinkage and ensure managers are on top of their staffing and alive to any potential fraud.


The software ensures that you can set different levels of authorisation – from managers to bar staff so that only those with authority can void transactions for example. It also has an accurate staff ‘clocking in and out’ programme so that you can be sure about who is working when and what they have taken.


Many of our customers have found that the web based software is preferable to old school localised software, since the web based can be accessed anywhere (for example, when owners and managers are away from the premises). This ensures that managers can be alerted at home when there are issues and can resolve problems more quickly. The software also means that regular fraud audits can be done, highlighting any potential frauds and helping to pinpoint their origination.


Software like Newbridge’s doesn’t just save time and help run businesses better, but it can also save them serious money. There is no other software like it and as someone who has worked within hospitality, I know that it is the most effective anti fraud tool you can use – helping to ensure that your staff are happy and that your margins stay healthy.”


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