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General Ops

Two Cents on Small Change

A useless explanation of why one of the most useless things in our industry is in fact, useless
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Pennies, nickels, and dimes. The bane of service industry employees everywhere, as their dealings command a portion of time that far outweighs their worth ... literally.

This is especially true considering these cumbersome denominations are almost always returned as gratuity immediately after they are distributed, making the time spent counting and procuring them (which some of us with sausage fingers is actually significant) them even more of a waste.

Change is also annoying for managers, requiring significantly more effort when creating banks, counting drops and depositing money.

Oh, and bank employees hate it to ... which makes it pretty much unanimous.

It is for these reasons many venues have started rounding all transactions to the nearest dollar. This means that anything above or equal to half (≥.50) will be rounded up, while anything below half (<.49) will be rounded down.

While this may seem drastic, the financial implications are negligible, seeing as the +/- almost always evens out over time, making the entire matter a

What is not so inconsequential is the affect on operations, with small change drastically slowing down all cash transactions.

Given, this is only by a matter of seconds, but for bartenders and other high-volume positions where cash is exchanged on a near continuous basis, this time adds up.

Plus, the amount of time is almost secondary to the fact that small change all but pointless in today's economy, making even a small loss in speed both annoying and unnecessary.

This is further comp, eradicating coins from an operation can literally improve efficiency overnight.

The level which you wish to round to is entirely subjective, but generally speaking there are two rules of thumb.

First, the higher the check average, the less exact change is needed. When people are dropping serious loot the plain truth is they are not going to be worried about a 49¢. This isn't elitist, this isn't wasteful, it's logistics, and for most people who can afford to frequent bars and restaurants this amount simply isn't worth the time it takes to think about it or the space / accommodations to store it. In some cases you might even get funny looks when you spend time fussing with change.

The converse is then also true, as selling something for $1.50 and just bumping it up to $2.00 is probably not a great idea. This is both due to the socio-economic diversity of people who buy things in that price range (50¢ is still money), and the fact that this is a 33% price increase.

Because regardless of the amount, no one likes to get screwed.

An additional thing to think about is check diversity. In most venues this will sort itself out pretty amazingly, with the natural occuring numbers obeying the law of averages and giving you almost an exact balance. But if you mainly sell just a few things, and the prices of those things fall in the same cent denomination, there is a greater liklihood your cash drop could be anomolously effected (allbeit a negligible amount).

What is right for each venue will be a balance of these factors.

And it should be noted that there will always be some patrons that look down upon rounding. Whatever reason, rationale or otherwise, this is their right and should not be ignored.

To appease these individuals while successfully getting rid of small currencies, one solution is the use of a small box consisting of nothing more than (you guessed it) small change.

This can be set up at the host stand and free to use on a semi-honor system basis for those who would like their missing change recouped (as there will usually be a host there making outright theft difficult).

This gives those who felt shorted by the rounding policy a chance to collect what they are owed, but in application this will hardly ever be used.

It's real purpose is just to give servers and bartenders a quick and easy explanation should customers protest.

If you need more proof, just ask someone who works at the next venue you see rounding practiced. I have yet to see an instance where it has led to genuine dispute in terms of admin or customer relations.

While on the other end of things it is one of the most consistent glut related pains in the industry.

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