How would you deal with a staff member that was stealing supplies from your restaurant?

Understand the reason behinde their behaviour before taking a decision 

It will all depend on how grave the committed crime. Each establishement must have/or have guidelines on how to handle such offense. You must not make it difficult for both parties by just implementing the procedures and move on. Each employee must have an understanding and a commitment of the whole scenario in your workplace prior to accepting the job. There is nothing personal. Document a report and submit it to the proper department-usually with the Human Resources and Security Department. If you don't have these departments, open your guidelines, act on it and report it to the local police. A theft crime has nothing to do whether you came from a wealthy or indigent family but it is an issue of character and behavior.

Consideration of human factor is important when it comes to making decision or setting examples. Situation would require further deliberation. 

i give them a second chance for improvement and betterment of work than  i'm able to work as a team member  

Give him a warning at the first time,deduct the amount from his salary if he does the same for second time.

First time warned him verbally and next time report to managment for dispornay action against him.

 GIVE DICIPLINARY ACTION FOR SUCH MISTAKES AND ACTIONS, BUT GIVE THEM SECOND CHANCES AFTER THE PUNISHMENT HAD BEEN SERVED TO BECOME BETTER EMPLOYEES OR WORKERS

In any organization they have rules and regulations that need to be followed. Therefore would have absolutely no tolerance for such an act regardless of the staff member's living conditions.

first of all you must have all facts documented.if not by  camera survalance it must be by either witnesses or confession.

if he steal once he will always steal.you must report him to the proper authorities and dissmiss him from work.

Everything has a reason.
First, talk to the staff where no one is around, Ask the staff if he/she have problem? or is there anything you can help them about their problems. Let them feel that you are there not to judge as a management, but a management where who can lean on. 

Tell them politely that you caught or some one caught them stealing supplies, remind the staff about the consequences of what he did. Give him/her a verbal warning at first but let him/her promise that it won't happen again.