Hot Tips & Takes: Revenue Forecasting & Financial Planning for Restaurants w/ Stephanie O’Rourk, CohnReznick

Meet Stephanie.

Stephanie O’Rourk co-leads CohnReznick’s National Hospitality Emerging Concepts, and Operational and Financial Consulting Divisions. Everyone from small, family-run restaurants to nationwide franchises can benefit from her insights into budgeting and forecasting. We sat down with her to learn the ins and outs of revenue forecasting and get the details on CohnReznick’s Restaurant Planning & Forecasting app.

Why is revenue forecasting so important for restaurants?

Revenue forecasting is the basis for the major line items in your overall forecasting cash flow — cost of goods, labor needs, and operating supplies. Therefore, whenever you start to model and do financial planning, revenue is an appropriate starting point.

Cashflow is the lifeblood of any business, enabling business continuity; the ability to invest in itself and future growth; as well as the ability to satisfy both short- and long-term debt obligations. It’s vital to understand how your business needs to perform in order to achieve your desired free cash flow and liquidity.

How does planning improve the resiliency of your restaurant and position you for growth?

To improve resiliency, you need real-time visibility into your business to make fiscally responsible and financially fluent decisions. It’s vital to the continuity of your business to understand where your cash flow is currently, and where it’ll be in the future. This can’t be done without measuring, forecasting, and monitoring the performance of your business on a consistent basis.

Another valuable tool is scenario forecasting, which allows operators to model how operational decisions affect their overall cash flow and financial performance. For example: You’re expecting a cost increase for a key ingredient utilized in numerous menu offerings from one of your main suppliers. If you utilize scenario forecasting, you can address menu prices based in a more thoughtful manner rather than just increasing prices by 5% across the board.

Planning provides an operator real-time forecasting and monitoring that will change as the business evolves. Monitoring your forecast and projections is what enables you to better monitor cash flow and, quite frankly, leads to operational success or failure.

What makes revenue forecasting difficult for restaurant owners?

It’s really a lack of understanding of their revenue and menu mix — the in-dining, to go, online orders, and food and beverage mix.

“If you’re utilizing the prior year as a baseline without understanding what some of those outliers were, and not adding relevant information for this year, you’re not forecasting.”

Another issue is understanding fluctuations in menu pricing and projected average checks. If you are reviewing year-over-year — comparing February to February, and then notice a big increase in May, you cannot assume that the increase is a result of menu price changes. That’s not a good enough. You must understand what caused the increase. It could have been more covers, it could have been increases in pricing. Not digging into the details to understand what happened in prior years is what can potentially produce a faulty forecast.

What are some of the common forecasting mistakes that you see operators make?

For a mature operator, one of the mistakes we see often is having a very siloed approach in terms of forecasting — that is, not incorporating all team members that affect all of the lines on their cash flow, financial modeling, and projections. You need to incorporate each important team member’s knowledge of the business for an accurate picture.

A big one is relying too heavily on historical data and just applying percentages across the board, stating: “I think we’ll grow 5% this year.” As we just talked about, utilizing straight year-over-year increases from the prior year without accounting for outliers doesn’t work. I see that a lot due to lack of understanding of menu mix and theoretical costs. Without menu analysis done on a regular basis, you don’t really have a true understanding of your costs for your various menu items.

Another mistake includes no consideration given for inflation as it pertains to expenses outside of the core prime costs. Everything in this world goes up in price. You’re seeing your G&A expenses, consulting expenses, office expenses, and paper supplies go up.

And then, there’s focusing on only P&L (profit and loss) items, but not incorporating balance sheet items that need to be considered when forecasting cash flow. That includes debt service, tax and profit distributions, and other long-term liabilities such as customer deposits. These are the things that affect current and future cash flow.

New operators are a little different, right? One huge miss we see a lot is failing to build the founders into their own model. How are they going to pay themselves? Another issue is they have no true North Star— no definition related to what successful growth means to them.

Finally, failure to execute on lessons learned.

“In the restaurant industry, we always concentrate on the bad when it comes to financial performance. Rarely do companies say, what did we do right? And how can we repeat that?”

That takes looking at your forecast and comparing it to your actuals. We must update the forecast as the business evolves, otherwise it becomes a useless piece of paper that we’re not able to utilize to make the decisions needed to be successful.

How do new restaurant concepts forecast when they have no historical data to rely on?

They must develop a menu. That’s number one.

Number two, they must cost that menu. Then they must understand their business model and revenue streams: Will it be in-dining or primarily delivery?

Next, determine the number of seats, projected table turns and covers, as well as the projected average check to generate the information you need to forecast for revenue and costs of goods sold.

You’ll need to develop a labor schedule, which is based upon your FOH and BOH needs, which ultimately is based on your covers. It’s not all about revenue; it’s covers and the minimum amount of labor required to successfully execute those covers. From a BOH perspective, whether you’re doing $100,000 in sales or $1 million in sales, sometimes you need the same number of cooks in the kitchen to successfully execute your concept.

Then, you base controllable expenses (expenses that are driven by revenue) on your revenue and business model. For example, if your model is to do a good deal of delivery, then your third-party delivery fees and paper supplies are going to be higher based ony our business model.

You also need to know the price per square foot of your restaurant space to determine your rent and occupancy costs as an industry standard percentage of revenue. These costs will only increase over time and are fixed in nature. An operator’s business model needs to support whether a space is an affordable long-term option for their future business needs.

For G&A, marketing, and the rest, you can use industry standards. These costs are typically fixed in nature and are not typically driven by revenue.

What are the implications of variables like a competitive labor market and high turnover?

Understanding the cost of turnover is critically important because it affects other aspects of your business. With turnover comes the loss of institutional knowledge, which in turn means a potential loss in revenues and increase in costs. A new employee isn’t as familiar with the menu, needs time to be trained, and might not be able to upsell as well. Those are the things you need to and build that into your financial model.

Any conversation about the cost of labor also includes retention and that takes rethinking how you pay and incentivize employees. Operators always think it’s too expensive to offer the benefits that everyone wants, but you don’t know that until you model it and see how it will affect your financial performance. The model will show you how employee retention could mitigate some of the risks associated with turnover.

Operators may find that they can afford most of those benefits that haven’t traditionally been provided by the restaurant industry. With the proper financial planning and analysis, an operator can see the potential increase in revenue that could come with providing such benefits

Operators always think it’s too expensive to offer the benefits that everyone wants, but you don’t know that until you model it and see how it will affect your financial performance.

You might find that you can afford all those benefits that haven’t traditionally been given in the restaurant industry, but the people who are doing financial planning and analysis can see how they could potentially increase revenue.

What kinds of tools/resources are important for restaurants to have as they’re building a forecast?

You should have the technology in place to obtain the information needed to perform budgeting and forecasting. The data you need will come from your POS, inventory management system, reservation system, general ledger, labor management system or any other business intelligence tool within your organization.

Integration is key when you’re trying to connect all the dots and connect the varying platforms. For instance, CohnReznick has a restaurant planning and forecasting application that provides instantaneous visibility into your business performance. It uses real-time data from all in-house sources to create both traditional and scenario budgets and forecasts.

“It’s important to understand what you’re going to do next year and what you should expect in cash flow, but what’s really more important is the real-time visibility that enables you and your team to make those quick, real time decisions.”

Information is power, and connecting platforms to provide real-time visibility into operational performance is key.

Back to my example from earlier: Suppliers told me that there is going to be a dramatic price increase on a key ingredient that runs across many menu offerings. So how do I pass that along? Do I pass the entire increase along to my customer? How is that going to affect my potential marketability? I might have to think about other revenue streams that might mitigate some of these additional costs that maybe I can’t pass along.

If you have the information at your fingertips and you can compare actual to theoretical, you’re going to be able to pivot in real-time. You’ll also able to identify operational trends, remediate risk, and forecast performance impacts.

Anything timely that restaurant operators should take into consideration in 2023 and 2024?

Again, lack of employee retention remains a challenge in the industry. It’s wise to rethink pay and incentives and understand how you will be able to pay for that. Many operators will be seeing significant increases in labor rates for some states in the next few years. Putting pen to paper, computing to quantify the financial impact on your business, and incorporating scenario planning into your future budgets and forecasts will put operators in a position to be ahead of the curve.

Commodities are also always a factor. For example, with egg prices — everyone talked about them and now they’re back down. There’s always something — like acts of nature — that cause a crop to underperform, resulting in demand outweighing supply and therefore higher prices arise.

We are still in a competitive market and understanding your market in your segment and geographic territory in relation to your menu pricing is key — because if you are above market, there has to be a value proposition that keeps customers coming through your doors.

Knowing your customer base and ensuring that you are catering to your bread and butter is everything. While there’s a lot of technology out there to help manage customer relations, it isn’t a substitute for real, face-to-face interactions and a human touch.

Stephanie leads the National Hospitality Emerging Concepts and Operational and Financial Consulting Divisions at CohnReznick. Learn more about her and CohnReznick here.

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Hiring, Training and Retention, Restaurant Management

A Server’s Guide to Managing Large Parties & Securing Better Tips

Do you start getting heart palpitations when you see a large party reservation in your section? This one’s for you.

Maybe your restaurant is a local go-to for corporate dinners, milestone celebrations, and birthday parties…or maybe you regularly get blindsided with 20-top walk-ins when you least expect it.

As every hospitality pro knows, no matter how prepared you are, managing large parties can be tricky. But if you do it right, it can be a fast track to large tips.

So the next time a 20-top bachelorette party drops in and “forgot to make a reservation:” no need to hyperventilate! We’ve got the tips and tricks that can keep you sane throughout a large party — and hopefully help you reel in a well-deserved tip.

4 Tips for Staying Organized

When your 25+ top walks in, getting overwhelmed can lead you to drop the ball on service and hospitality because, hey — you’re just trying to get right right food, to the right person, as fast as possible. But your guests can pick up on when you’re frazzled or frustrated, which can impact their experience (as well as your tip).

Here are a few ways to stay organized and calm throughout service.

Get (a little more) familiar with your POS

Every POS system is different, but most have come quite a long way in terms of features and flexibility. There are likely bells and whistles on your POS that you might not use every day, but that can make managing large parties much more seamless.

So use all that tech to your advantage. Set aside time for some extra training or research to understand what your POS is capable of, so that it’s all muscle memory the next time you have a large group sitting in your section.

For example, here are just a few things you should know about your POS as it relates specifically to large parties:

Is there a max number of ways you can split a bill evenly?
How many checks can you create on each table?
How many ways can you split a single item?
Do you need manager permission to add auto-gratuity?

Assign seat numbers

The only way to stay sane when dealing with a large party is to assign seat numbers — and stick to them.

You should assign seat numbers starting with your first guest on the left and continue around the table moving counterclockwise. As you put in the first round of drink orders, your POS should allow you to assign items to a seat number. Even if guests move to different seats throughout the meal, stick to their original seat number.

Sure, it’s tedious — but these numbers will be your saving grace when someone asks you for another drink or when they want to split the check by family. No matter how in the weeds you are, take the time to add seat numbers. You’ll thank us later.

When they ask for 15 separate bills, you can just drop each seat number into a new check and print. No need to go back and ask, “who had the fish?”

Don’t trust your own memory

As a server, it’s normally a crowd-pleasing flex to take everyone’s order from memory. But when you’ve got 17 people depending on you to make grandma’s 97th birthday lunch a success: Pull out your server book.

Not only are you bound to forget something, but your guests may not feel entirely comfortable either. If they’re worried you’re going to forget they want their sauce on the side, they may be less inclined to ask questions about specials or which dishes are your favorites. And if guests feel like they have to stick to the basics, you’re missing out on all of your upselling opportunities.

Just for the night, don’t be a hero: write down everyone’s order!

Bring in some help

Depending on how many guests you have at one table, you might need more help than normal — and there’s no shame in that.

If you’re aware that a big party is on the books, coordinate with your team ahead of time. For example, see if you can have an assigned busser or bartender on call to help you keep drinks filled, tables clean, and guests happy.

Wowing Your Guests

To secure the huge tips that come with large parties, you’ll have to go above and beyond.

Be ready to make suggestions. Being knowledgeable about the menu always reflects well. Explain your specials in detail, offer drink pairings, and accommodate guests with special requests. This is your shot to upsell and increase the bill!

Keep the drinks flowing. No one wants an empty glass. Send bussers around with pitchers to top off waters, and always be ready to grab another round of cocktails.

Stay in contact with the kitchen. Give the chefs a heads up that you’re going to put in a large order so they can prepare accordingly. With more preparation, they’ll be able to get the whole table’s food out in a timely manner. No long waits for everyone to receive their food!

Pre-bus as much as possible. Keep the table neat and tidy, so they have rooms for multiple rounds of appetizers, drinks, and dessert.

Use your seat numbers. You shouldn’t have to serve entrees as if it’s an auction. Instead of announcing each dish to ask, “who had the burger?” you should be able to reference their seat number and pass each entree to the right guest. It’s a simple way to show your serving prowess (and speed up the serving process!).

Even with a crowd at your table, you can go above and beyond on service. Your guests will take notice and show their gratitude on the tip line (more on that later).

Splitting the Bill

You’ve made it through most of the craziness of a large party — but now it’s time to settle the bill. Before everyone closes out their tabs, you might have to navigate a few sticky situations.

Who’s paying?

It’s always awkward to stand next to the table while people fight over who’s taking care of the bill. Here’s what you can do to alleviate some tension:

If someone offers to pay early on in the meal, take them up on it. Go ahead and keep their card so you can run it before the arguments start.
When 3 different people want to pay for the meal, offer to split the bill evenly. They probably won’t take you up on it, but your suggestion should get one of the parties to acquiesce.
Ask how checks will be split at the beginning of the meal to avoid the awkward card dance at the end. You’ll also have an easier time splitting items if you know ahead of time!

To auto-grat or not to auto-grat

Do you want to make sure you get your full 20% tip after a big table runs you ragged? Or would you rather take the risk in hopes that you’ll get an even bigger tip?

If your restaurant has an auto-gratuity policy for large parties, some servers prefer to take the sure thing and hope that your guests feel inclined to give you an extra thanks on top of it. Most guests aren’t offended and even appreciate that they don’t have to do any math — but make sure that they’re expecting the service charge. A simple line like, “We have already included a 20% gratuity in accordance with our large party policy,” goes a long way.

When you have a really fun rapport with a table, it might be the right time to forgo the auto-grat and let your guests decide how much they’d like to thank you. Keep your guests in the know, too! Some may assume that you included gratuity and skip the tip line altogether.

Either way, steel yourself before you look at their final bill. You might be surprised when customers leave less than you expected, or you might be treated to a heavier-than-average tip.

Tipping out

After it’s all said and done, your manager may have a tip out policy for supporting bussers and bartenders who assist with large parties. Make sure you know what to expect to take home after tipping out your team.

And managers, Kickfin makes large party tip outs easy. Make sure that your event bartender gets their fair share of server tip outs, without spending hours with your calculator.

>>Learn more about Kickfin’s newest tip calculation features

Whether you’re hosting a graduation party or taking care of a corporate holiday dinner, be ready to handle it with the same care and attention you give to a two-top — and let the big tips roll in!

Product and Company News

Kickfin Ranked 65th Fastest Growing Company on the 2024 Deloitte Technology Fast 500

We’re thrilled to announce that Kickfin made the Deloitte Technology Fast 500™ list, a ranking of the 500 fastest-growing technology, media, telecommunications, life sciences, fintech, and energy tech companies in North America.

How Kickfin stacks up

Overall, 2024 Technology Fast 500 companies achieved revenue growth ranging from 201% to 153,625% over the three-year time frame, with an average growth rate of 1,981% and median growth rate of 460%.

Our 2,144% revenue growth earned us the 65th spot on Deloitte’s list. It’s another exciting milestone for Kickfin — but more importantly, it’s a meaningful validation of our mission to take the clunk out of tip management, so payouts are faster, smarter and safer for every restaurant team we serve.

Based on Deloitte’s ranking, Kickfin is:

The highest-ranked restaurant tech company on the list
The *only* tip management company on the list
Austin’s fastest-growing tech company

Growth driven by product innovation, demand for automation

Kickfin was the first digital end-to-end tip management solution on the market — and with more than $2 billion payouts to more than 250,000 restaurant employees, we continue to be the largest and top-ranked.

Why?

It comes down to working the way our customers work — and not the other way around. Not only do we automate the tip pooling and payout process for thousands of restaurants and bars; no two tip policies are alike, so we’ve built a solution that gives them the flexibility and customization they require.

With more than $2 billion payouts to more than 250,000 restaurant employees, Kickfin continues to be the largest and top-ranked tip management software on the market.

That’s a big reason we’ve focused on building direct, robust integrations with the leading POS systems on the market. So far, we’ve rolled out integrations with Toast, SkyTab, Oracle, PAR, Heartland and Square — and the list continues to grow.

“In recent years, digital tip management has become table stakes,” said Justin Roberts, Kickfin’s co-founder and co-CEO.

“Operators now understand the significant efficiencies to be gained by eliminating manual tip-out processes. It’s no longer a question of ‘if,’ but ‘how.’ As a direct result of our commitment to innovation and customer success, we’re thrilled to see more and more restaurants select Kickfin to modernize their tip management.”

A big thank-you to our customers who trust us with their payouts, to our partners who support, collaborate (and integrate!) with us, and of course, every member of the Kickfin team.

About the Deloitte 500

Now in its 30th year, the Deloitte Technology Fast 500 provides a ranking of the fastest-growing

technology, media, telecommunications, life sciences, fintech, and energy tech companies — both public and private — in North America. Technology Fast 500 award winners are selected based on percentage fiscal year revenue growth from 2020 to 2023.

In order to be eligible for Technology Fast 500 recognition, companies must own proprietary intellectual property or technology that is sold to customers in products that contribute to a majority of the company’s operating revenues. Companies must have base-year operating revenues of at least US$50,000, and current-year operating revenues of at least US$5 million.

Additionally, companies must be in business for a minimum of four years and be headquartered within North America.

Ready to take the next step?

See how brands like Walk-On’s, Marco’s, Bar Louie and more are automating tip pooling and payouts with Kickfin. Schedule your 10-minute demo today!

Industry Trends

How the 2024 Presidential Election Could Affect Taxes for Tipped Employees

It’s an election year, in case you haven’t heard! 😉 This one has major implications for tipped employees — specifically, when it comes to taxes.

It’s no secret that our Democratic and Republican candidates are running on very different platforms. But when it comes to tip regulations, Vice President Kamala Harris and Former President Donald Trump actually both support reducing taxes on tips.

A little context on taxes and tips

We’re just going to state the obvious: For the average American, tax reporting can be pretty, pretty confusing. For the millions of employees working in tipped occupations — well, that creates another layer of uncertainties.

(Do I have to report my tips? Do have to report my cash tips? Will anyone know if I don’t report my tips? What happens if I don’t accurately or fully report what I earned?)

Historically, there’s been a trend of hospitality employees underreporting cash tips to prevent higher tax burdens. And while this may reduce what employees owe Uncle Sam in the moment, there can be downsides: e.g., if they find themselves eligible for unemployment, if they’re trying to qualify for an auto loan or mortgage, etc.

However, that urge to underreport could be relieved in the near future, given the tax code changes both of our presidential candidates have proposed. The TL;DR: Both Trump and Harris have voiced their intention to relieve some of the burden on tipped workers in restaurants, bars, hotels, and other service positions.

Here’s a quick summary of each candidate’s plan, as well as some potential impacts for restaurant employees.

Trump’s plan for tipped employees

Trump shared his plan to reduce tipped income tax burden at a rally in Las Vegas — fitting for a city that’s built on the gig economy. Nevada is home to the highest concentration of tipped employees who work in the many hotels, casinos, and restaurants that millions of tourists flock to annually.

During the rally, the former president announced that he would make tipped income exempt from federal income tax, stating it would happen “right away” when he takes office.

Since speaking at the rally, Trump has not yet clarified what this would mean for tipped employees. Many servers want to know if this is an exemption just on federal income tax or if the proposal includes payroll taxes (social security and Medicare).

Harris’s tip tax proposal

Harris also took the opportunity to speak on her tipped income policy while visiting Nevada. Much like Trump, she knew she’d have a captive audience when it comes to tipped earnings.

Her proposal promises to exempt tipped income from the federal income tax, but she has made clear that tips will still be subject to payroll taxes. While not yet confirmed, campaign insiders say Harris is considering placing some guardrails on her plan — like a caveat that the tax exemption only applies to employees earning less than $75,000 per year.

Is one plan better than the other?

In short: probably not. (Most service and hospitality workers do not earn above the $75,000 threshold that’s been suggested by the Harris campaign.) So either way, servers, bartenders, and hospitality staff can expect to see a lower tax burden during the next administration.

But what does that look like in practice?

Most tipped employees aren’t receiving their tips on payroll — they’re walking out of every shift with their earnings for the night, deduction-free. Instead, the taxes are paid on payroll out of their hourly earnings, which is why many servers get $0 paychecks every two weeks. With a reduced tax burden, most servers will see the difference in higher paychecks.

On the other hand, economists are wary of the impact of eliminating taxes on tips, citing the reduced funding for social security and Medicare. And with so much negative sentiment around “tipflation” these days, experts also speculate that a reduced tax burden may result in even more hesitance at the tip screen.

Increasing minimum wage

We’re closely following campaign promises about an increase to the minimum wage — especially in regards to the tipped minimum wage and the tip credit.

Minimum wage earners have been eyeing an increase, noting that the federal minimum wage of $7.25 per hour hasn’t increased since 2009, and servers, bartenders, and other tipped employees have been earning $2.13 per hour for over 30 years. An increased minimum wage paired with the reduced tax burden could make a major difference for service workers trying to keep up with the rising cost of living.

In the Harris camp, removing tax on tips is just part of the plan to take some pressure off service workers. While Harris hasn’t shared a detailed plan for bumping up the minimum wage, she has indicated that she would support an increase.

In previous election cycles, Trump stated that he would consider a minimum wage increase, but he has not shared his opinion on the matter during the 2024 presidential campaign.

Of course, we’re a ways out from any real policy changes actually shape — but if you’re looking to make your tip management process less taxing in the interim (see what we did there?), Kickfin is here for you! Check out how you can use Kickfin to auto-calculate tip pools and send payouts directly to employees’ bank accounts in seconds.

Restaurant Management

Top 4 Ways to Protect Your Restaurant from Cash Shrinkage

No matter what industry you work in, there’s always a risk for shrinkage and theft. Ninety-five percent of all businesses experience theft in the workplace, and up to 75% of employees have admitted to stealing from their employer.

Most of the time, it’s not intentional or malicious. For restaurants, it could be something as innocent as giving your friends a free drink or asking the kitchen for food and neglecting to ring it in.

But when you have a lot of employees handling cash day in and day out, it can be very tempting for someone to take advantage of systems and pocket extra money at your expense. To make matters worse: because cash is hard to track, it can be tricky for operators to put their finger on exactly what’s happening — at least, before it starts to impact your bottom line.

While cash shrinkage can jeopardize your business, operators do have the power to protect their restaurants. Ultimately, it comes down to having the right processes, systems and partners in place.

Here are 4 things you can start doing today to protect your restaurant from cash shrinkage.

1. Create a culture of trust with employees

Most people want to come to work, do their best, and make an honest living. Creating an environment where your employees trust you with their earnings should encourage them to also be responsible with company assets, including cash.

Of course, it starts with doing your due diligence when building out your team. That means interviewing new hires in person, asking the right questions, and always checking references.

But the fact of the matter is that even good people can make poor decisions, especially when they’re struggling. As an employer, there are things you can do to keep your staff from ever getting to a place where they feel the urge or need to steal. That includes:

Paying a fair and competitive wage
Paying wages on time, in full
Giving people instant access to their earnings
Offering employee benefits and perks if possible
Adhering to federal, state and local labor/wage regulations, especially as they relate to tips

Bottom line: If you show that employees you take their financial well being seriously, it can foster an environment of mutual respect, making employees less likely to consider theft as a reasonable (or justifiable) option.

2. Minimize cash touchpoints

It’s simple. Less cash on hand = less opportunity for cash shrinkage.

In the unfortunate case that a high-ranking employee is stealing from your restaurant, cash tip outs make it much more difficult to catch and trace. Anyone with access to cash registers and safes has the opportunity to take a few extra bills — and you may not notice until well after the cash is pocketed and spent.

Instead of locking up cash and making only a few employees responsible for the massive task of paying out tips, take advantage of new technology that eliminates cash from the tip out process. Fewer people will need to manage cash, which adds one extra layer of security against theft.

Bonus: cashless tipping vendors like Kickfin give your employees more flexibility with their earnings. They can opt for tips to be sent directly to their bank or to have them put on their payroll check, empowering employees to make their own financial decisions.

3. Create a digital paper trail

The trouble with cash is the inability to track it. Half the battle is realizing that the cash is missing; and once you know it’s gone — well, now what?

Digital gratuity management software makes it easy for restaurant operators to create a digital paper trail for all tip payouts. You’ll be able to identify any improper payments, who they went to, and who authorized the payout — removing a major security soft spot.

Not only will you feel more secure, but your loyal employees will thank you for making tip outs much easier.

4. Select a secure tip management partner

Removing cash-on-hand is a great first step, and it should make any potential theft traceable back to the person responsible. But wouldn’t you rather prevent theft before it happens?

If you’re ready to bring your gratuity management into the future, make sure to thoroughly vet your options — because not every digital tip out software has strong protections against theft.

That’s why Kickfin has optional guardrails that can mitigate your risk of employee theft.

Maximum tip amounts: Limit the amount that can be issued in any individual payout.

Role policies: Create policies to limit who can receive payments by role type, and limit who can send payments to themselves.

Multi-factor authentication: Set your own rules to require MFA at any point, whether at every login or once a month.

Payment interval approval: Trigger a requirement for second approval for an employee’s first payment or their first payment in a determined number of days.

Payment velocity approval: Trigger a requirement for second approval when an employee receives a determined number of payments within a certain interval.

For our POS integration partners, Kickfin can also put guardrails around your tip calculation policies to prevent fraud. While we offer the ability to send payments through manual entry, spreadsheet upload, or using our tip calculation software, integration users can disallow manual and upload payments to prevent any ad hoc payouts.

Integration users can also lock in their tip calculation rules, so that only certain users can make changes to the calculation policy.

How Kickfin helps in the event of fraud

Even without the temptation of cash in the safe, where there’s a will, there’s a way.

If you find yourself in a regrettable situation with an employee, your tip management partner should be there to back you up. Thankfully, our platform tracks each payout which will help you identify irregularities and the source of the problem.

The Kickfin team will always be there to support our partners who experience security breaches.

Check your Kickfin security settings

Do you want to make sure you have the most up-to-date protections on your Kickfin account? We’ve got you covered. Reach out to your Kickfin customer support team to ask about a free security audit, where we’ll go over your current settings and offer guidance on how to minimize your risk.

Not yet a Kickfin user? Find out more about our platform and security settings with a demo today.