Consumable items are essential for effective day-to-day working of any organization. Although both fixed and consumable asset management are important, the nature of consumable assets makes them prone to misuse. Reliable business material management systems play a key role in tracking fixed and consumable assets, which prevents the wastage of resources, improves cost control, and prioritizes transparency.
What is Asset Management and Why is it Important?
Asset management is the process of storing, using, managing, improving, and processing assets economically. It ensures that companies get the maximum benefits from their assets by optimizing usage and output. There are several types of assets, like physical or fixed assets, consumable assets, financial assets, digital assets, etc. Modern automated asset tracking systems have simplified and streamlined the process of asset management to improve access, save costs, and maximize performance.
Key Features of Asset Management
The key features or components of asset management that are common to all types of assets include:
- Comprehensive asset database
- Management of asset life cycle
- Value estimation (current and depreciation)
- Upkeep to extend the asset life cycle
- Performance tracking
- Managing potential risks
Whether it is fixed asset control or consumable tracking, the presence of these features ensures performance and optimization in asset management.
Importance of Asset Management
The importance of asset management extends beyond simple inventory control, it plays a significant role in operational efficiency as well. Effective asset management:
- Ensures cost saving
- Enhances decision making
- Improves compliance with regulations
- Reduces risks
- Ensures accuracy in financial reports
- Provides essential data on asset performance
- Assists in long-term strategic planning
How to Track Fixed Assets?
Fixed asset management systems are essential to the maintenance, storage, usage, and long-term value estimation of fixed assets. The general inventory management steps for fixed assets include:
Maintaining Asset Database
For corporate asset tracking the compilation of a comprehensive fixed asset database is essential. This centralized hub includes information such as asset type, date of acquisition, cost, location, assigned department, warranty details(if applicable), etc.
Asset Tagging
All physical assets need to be appropriately tagged using barcodes, RFID, etc. This decreases the risk of asset management errors and improves asset tracking.
Asset Tracking Automation
Asset tracking automation refers to fixed asset tracking systems or software that perform functions such as long-term value estimation, schedule asset maintenance, etc.
Categorizing Assets
Properly categorizing fixed assets (type, department, location) enables companies to streamline factors such as maintenance schedules, budget allocation, relocation, etc. It also prevents many issues that arise from manual tracking.
Current Value And Depreciation
Fixed asset tracking includes value estimation (current value and depreciation over time).
Asset Maintenance
Fixed assets require consistent maintenance and repairs. Scheduling regular upkeep extends asset lifecycle and saves costs.
Asset Disposal
An integral part of fixed asset tracking is to record the disposal (loss, scrapping, donating) of assets. It helps evaluate any losses or replacement expenditures.
Common Mistakes in Asset Management
Common mistakes that lead to faulty asset management practices and should be avoided are:
- Lack of an asset database or register (fixed assets and consumables)
- Improper or faulty tagging of assets
- Inaccuracy in current value estimation and long-term depreciation
- Lack of proper annual audit
- Not availing of asset tracking systems
- Not registering asset losses
- Improper maintenance scheduling
These mistakes can become costly in company asset management and often lead to the waste of precious resources. The improvement in asset management systems (both fixed and consumable) effectively minimizes and prevents these common mistakes in asset management.
An Ideal Fixed Asset and Consumable Tracking Process
An ideal asset management system for consumable process and material process optimization should include the following features:
Accurate Identification And Tagging
Accurate labeling and tagging (QR codes, RFID) of both physical and consumable assets improves the tracking process and decreases costs in the long run.
Centralized Inventory Listings
A well-maintained centralized hub of all inventory leads to effective fixed asset management as well as tracking consumable assets.
Automated Tracking Tools
Incorporating automation in the form of various asset-tracking tools saves valuable time and provides access to features like live updates, notifications, access to mobile apps, etc.
Ownership, Audits, And Verification
Data concerning ownership, annual audits, and verification of assets (consumable and fixed) prevents faulty asset management and value loss.
Asset Life Cycle
An ideal asset-tracking process accounts for proper maintenance scheduling, regular repairs, and disposal of assets for better management of the asset life cycle.
Analytics
Detailed reports and analytics compilations for consumable and fixed corporate asset tracking provide invaluable data in terms of value estimation, usage, and effective budgeting.
The importance of asset management for tracking consumable and fixed assets is undeniable. Implementing asset-tracking systems streamlines the process, enhances efficiency, and positively impacts the bottom line.
