Is it possible to be too focused on providing quality installations to customers? Perhaps, say several window film shop owners and such a focus can have a number of costly unanticipated consequences.

Ken Steele, owner of Solar Shade and Truck and Car Paradise in Waynesville, Ohio, says not focusing closely enough on his company finances opened the door to embezzlement from one of his employees to the tune of nearly $200,000.

Steele admits he knew little about the business side of tint shop ownership when he started out.

“I was terrible at recordkeeping because I didn’t understand that you had to track this stuff and keep an eye on it. I started growing and hiring more employees. I had an older secretary and a manager who obviously realized I wasn’t tracking anything. I had nothing in place—no checks and balances,” he says.

The embezzlement, which took place close to 15 years ago included stolen parts from the company’s truck accessories business. It forced Steele to revisit his business plan and company model.

“Back in those days I didn’t know what to look at … I just didn’t have any idea of what to track. So the guy started embezzling from me over a three-year period. My secretary decided to retire, so I hired the lady who’s with me now and she came to me and told me I had a huge theft problem. I had a buddy even tell me that I was being stolen from … that guy was living the lifestyle I should have been living. I went through four months of bankruptcy, but we stopped the bleeding and I had the police come and arrest him. Then I sat for the next two or three months going through everything. I found about $160,000 of it [the stolen goods] that way myself.”

The wake-up call forced Steele to allow an outside agency to review his company infrastructure.

“I had a company come in shortly after this happened that said it would like to go through my company and turn things around. I’m flat broke at this point; I’m done … This company sat here for three weeks and $50,000 and went through everything.”

Large-scale theft isn’t the only form of embezzlement window film shop owners should watch for, however.

Bob Dicken, president of ESP Co. Inc. in Louisville, Ky., said smaller-scale theft caused him to drop automotive window film services.

“I had a car guy who worked for me for 10 years who was ‘borrowing’ money out of the cash drawer. He was buying drugs, not for himself, but so he could sell them and he couldn’t figure out why I let him go,” he says. “This was several hundred dollars this guy was stealing from me from the cash drawer … I got in the habit of taking the key to the cash drawer home with me at night and one morning I came in and the cash drawer was empty again … I found out he had pried the drawer open to get money to buy cocaine for one of his customers.”

While it’s the only instance in which Dicken says he knows an employee stole from his company, it raises serious implications for the industry.

“The car business, a lot of it is cash. You can dummy up an invoice … it’s hard to keep up with things like that. Nowadays, everyone is using credit cards, but four to six years ago that wasn’t the case,” he states. “It’s also a big temptation for some of these guys to buddy up to the customer and then offer to tint the wife’s car over the weekend for half the price using the company’s stocked film.”

In addition to getting out of the automotive business, another way Dicken says he protects his company from theft is by having his installers record the inches of film used for a job.

“We have a pretty good control on our flat glass inventory. My guys have a worksheet for each job that they do and we measure the film in inches … They waste a lot of film on cars and film tended to disappear, so I got out of the auto business and I’m not going back.”

To help prevent theft, Steele says employers need to ask the right questions.

“Back then, I didn’t know who to ask about how to run a business,” he says. “Recently I hooked up with Score, funded by the Small Business Administration and free for users. It’s run by retired executives who help small businesses grow and help you with your problems. Now I use them constantly. I have them send down a guy to help put an accurate number on our budget.

“My biggest advice would be the simple fact that you’ve got to ask for help. You have to ask questions and have people helping you that are smarter about these things than you,” Steele adds. “If you aren’t watching your money then the same thing that happened to me will happen to you … You have to pay attention, because if you aren’t someone else will.”

Score, a program funded by the Small Business Administration, provides mentoring services to small businesses, including help with business plans. To contact your local chapter, visit www.score.org.