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At Some Businesses, Cash Isn’t King
Moving to a cash-free system has helped six of Sweetgreen’s 48 locations help customers much faster. But the move to exclude cash from payment options brings its own risk, say experts.

Moving to a cash-free system has helped six of Sweetgreen’s 48 locations help customers much faster. But the move to exclude cash from payment options brings its own risk, say experts.

As more businesses adapt to chip cards and customers who want to pay for items with apps, an old-fashioned method of settling bills may be falling to the wayside: Cash.

A recent New York Times story profiled the decision of Sweetgreen, a popular chain of fast casual restaurants, to stop accepting cash at some of its locations.

Jonathan Neman, a co-founder and co-chief executive of the company, said he initially thought the idea was “harebrained.” Then, he came around. “We looked around and saw that airlines haven’t been taking cash for a while,” he said.

Knowing that his customer base was heavy on millennials who have grown up with credit cards and smart phones, not cash, in their wallets, he thought: Why not try it out?

The numbers seem to be on the side of the experiment, at least for Sweetgreen. At the company’s 48 locations throughout the U.S., cash purchases have declined to less than 10 percent today from 40 percent of all transactions when they opened their first location nine years ago, he said. Sweetgreen also has its own app, which allows customers to order and pay. (Those in-app purchases make up one-third of the company’s transactions, Mr. Neman said.)

Among the advantages to doing away with cash transactions:

Faster service. “One of the biggest complaints at Sweetgreen is the line, so by reducing cash we’re able to serve customers a lot faster,” Neman said. At the six Sweetgreen locations where cash is not accepted, employees can perform 5 to 15 percent more transactions an hour.

More secure employees. In a cash-free environment, employees are safer, Neman said. There have been only a handful of thefts and robberies since Sweetgreen has been in business, but he said he believed that going cashless deterred thieves. “I don’t think anyone’s coming in to steal arugula.”

The move to cash-less service isn’t for everyone and it’s not without its own risks, according to the story, which notes that “a 2015 study on consumer payment choice from the Federal Reserve found that although credit card use was steadily rising, slightly over 26 percent of purchases were still made in cash.”

Cashless environments also exclude customers who may not have a bank account (an estimated 8 percent of the population) and can reduce customers’ anonymity. As the story notes, “credit cards and apps leave a digital trail that can leave consumers vulnerable to security breaches, which worries consumer privacy advocates.”

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