Tripping Out

Do employee vacations wreak havoc on your business?
Magazine Contributor
7 min read

This story appears in the June 1999 issue of Entrepreneur. Subscribe »

Does an employee's mere mention of the word vacation send chills down your spine? The chaos caused when staffers are away for a week or two can put any entrepreneur into a panic. But it doesn't have to be that way. With a little planning, your company can run smoothly--and your employees can enjoy their vacations without too much dread of returning to work.

Peggy Isaacson, a human resources consultant in Orlando, Florida, suggests you start by creating a master vacation calendar. "At the beginning of each year, find out who already knows when they want to take their vacation and mark it on the calendar," she says. "Of course, not everyone will know what they're going to do that early, but just asking will often get people thinking and planning."

You should also establish policies that dictate how many people can be off at the same time and how to settle disputes over vacation time. "Don't wait until it becomes an issue to make that announcement," Isaacson cautions. "Make sure people know what the policy is."

Proper scheduling is a first step, but how do you make sure that service and productivity levels remain consistent when employees are on vacation? "Cross-train thoroughly so no job is left undone while someone is on vacation," Isaacson says. "Write procedure manuals so everyone will know what to do. Don't let yourself get in the position of having to tell [customers] whatever they want can't be handled until so-and-so gets back from vacation."

It's also a good idea to meet with key employees well in advance of their departure and plan for their absence by finding out what projects they're handling, what issues are pending, and the answers to whatever questions may be asked while they're gone. Make sure you have access to all their files and information. You may even want to ask senior staffers to provide phone numbers so you'll be able to reach them if there are emergencies--but don't use those numbers unless you absolutely have to. "Employees are entitled to--and need--time off," Isaacson says. "No one should be so indispensable to your business that you can't let them take a vacation."

Stealing Away

How to catch an off-book thief

For many companies, especially cash businesses, employee theft is considered just a cost of doing business. Particularly hard to spot are "off-book" thefts, in which money is stolen before it gets into your bookkeeping system.

CPA Thomas Rafferty, a partner with Fairfield, New Jersey, accounting firm Mintz Rosenfeld & Co. and an expert on small-business fraud, says there are common off-book schemes to look out for. These include skimming, where a portion is pocketed before the sale is rung into the register; fraudulent voids, where sales are made to look like they were canceled, a mistake was made or the merchandise was returned; and swapping noncash for cash by not recording checks or credit card receipts in the register and taking a corresponding amount of cash.

Typically, you don't realize such thefts are occurring until so long after the fact that identifying the perpetrator is difficult, if not impossible--sometimes not until financial reports indicate reduced profits. And when the thief is stealing very small amounts, there's almost no way to find out.

How can you detect and prevent off-book theft? Rafferty offers these tips:

  • Be sure your cash register display is in plain view. This allows customers to see they aren't being overcharged and that the amount they're asked to pay is the amount that was rung into the register.
  • Always give receipts. Make it a policy to give receipts with every sale, and consider offering a reward to customers who don't receive one.
  • Review your transactions often. Look at cash register tapes and credit card charge slips for unusual patterns, excessive voids or other suspicious activity. The benefits of this routine go beyond identifying theft. If, for example, you have an employee who voids a lot of sales, he or she may be stealing--or might need training on how to properly operate the equipment.

Many entrepreneurs feel that such supervisory measures are just too time-consuming. But if you don't have time for these onerous tasks, Rafferty says, your business may be too large for you to manage alone.

  • Require a supervisor's approval on voided sales. Such scrutiny makes it harder to pocket cash unseen.
  • Consider visual monitoring methods. Mystery shoppers and plainclothes security may be able to spot theft. Or you could install surveillance cameras.
  • Use controls that will help you take action. It's not enough to quantify your loss; you also want to identify who was responsible. Implement theft-control measures that will pinpoint the source.

Image Control

Using first impressions to build a credible reputation

You know first impressions are, important, but have you thought about what elements affect your credibility when you meet someone? There are four key factors, says Tom Hinton, president of the Customer Relations Institute, an international training and consulting firm in San Diego:

Location. Consider the place you plan to meet important customers or associates. Your credibility is greater in a business environment than it is, say, at a local tavern. "My favorite places are chamber of commerce functions, Rotary meetings and the first-class sections of airplanes," Hinton says.

Who introduces you. The person who actually performs the introduction is another critical credibility builder. Ideally, Hinton says, the person who performs the introduction should be at least a peer of the person you want to meet. "Someone who already has credibility with that individual enhances your credibility," he says. But even with this in mind, never miss out on a chance to meet someone just because there's no one around to introduce you; there's absolutely nothing wrong with introducing yourself.

Bonding. Once the introduction is made, you need to say something to help you bond with the other person. If you've met before, mention it--especially if it was in a particularly credible situation. Hinton says other bonding themes include mutual acquaintances, magazines or books, sports, shopping, and items of apparel. "To compliment somebody is a nice way to start a conversation, but be sure the topic is appropriate to the situation," Hinton says.

Your identity hook. If people remember your name, you have automatic credibility, so give them a tool that helps them. If your name is the same or similar to that of someone famous, come up with a clever line to capitalize on it. If your name is unusual, offer a brief explanation of its background; if it's hard to pronounce, give people a way to help them say it.

The Deal On Wheels

What your company vehicles say about you

Whether it's the cars driven by your sales staff or the trucks driven by your service or delivery people, your company vehicles are an extension of your organization. To be sure they project a positive image, set a policy outlining how company vehicles are to be used and maintained. Chester Pallohusky, vice president of operations with US Fleet Leasing in Carrollton, Texas, says a basic policy should cover the following areas:

  • Driver eligibility. Do the primary and other authorized drivers (including other employees and members of the primary driver's family) have valid driver's licenses and acceptable driving records?
  • Fuel procurement. You have a range of choices regarding how fuel will be purchased, including gasoline credit cards, special fuel purchasing cards and reimbursement programs. "Fuel expense is roughly two-thirds of the operating cost of your vehicle," Pallohusky says. "You certainly want to control that expense." So choose the payment method that will make it most convenient for you to monitor fuel costs.
  • Maintenance. Establish a preventive maintenance schedule, and set up a monitoring program to make sure your employees adhere to it.
  • Personal use. Are employees allowed to use their company cars for personal activities? If so, you need a system that tracks that use for tax reporting purposes.
  • Replacement. Schedule vehicle replacement cycles, either in terms of months or mileage.

Next Step

  • If you need help developing loss-control measures, CPA Thomas Rafferty suggests starting with your accountant, who should be able to show you various record-keeping techniques that will identify where and how losses are occurring. Or you can contact a risk-management or security consultant with expertise in your particular industry.

Contact Sources

Customer Relations Institute, (800) 544-0414,

Mintz Rosenfeld & Co., 60 Rte. 46 E., Fairfield, NJ 07004, (973) 882-1100

The Portable Personnel Office, (407) 290-1146,

US Fleet Leasing, 2312 Trinity Mills Rd., Carrollton, TX 75006

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