Inventories are one of the most misused current assets in an organization. Due to a lack of proper monitoring, workers often overuse them. Due to this reckless attitude, companies overspend on their inventories, which eventually increases the cost of production. That is why inventory asset tracking is essential.
Companies have experienced significant changes after integrating an asset-tracking system into their organization. There was less inventory waste, and production became more efficient. Monitoring the production process with the CloudApper, EAM mobile app can make employees more responsible, and management can accurately track the consumption of the inventory.
What is inventory asset tracking?
Inventory can be either the resources used to produce a finished product or the final product that the company will sell. These are considered assets for the company since a particular investment was allotted for their purchase. Since these assets are in large quantities, they can be easily mishandled. That is why, to ensure the proper usage of inventory, companies implemented inventory asset tracking.
The concept is as simple as it sounds. The idea is to track or monitor the inventories and keep records of the activities. From the purchase of the raw materials, the amount will be recorded and then compared with the final products to determine the efficiency of the output. The final product will also be tracked to ensure that no items go missing.
Inventory asset tracking vs. asset management
A system for asset tracking and asset inventory management are important tools for businesses that want to keep costs down and increase output. Understanding the distinction between these operations and the systems that can enhance them will enable businesses to address and manage their unique challenges more effectively.
Inventory management systems assist businesses in managing the stocks of consumable items across multiple stages. This concept applies to most industries. For retailers, the management of safe stocking and re-order periods, and for manufacturers, incoming raw material and outgoing finished goods.
The concept is practiced to ensure:
- Raw materials are well utilized.
- Finished goods are not missing.
- Accurate demand planning.
- Recording all activities.
Asset tracking focuses more on physical assets like equipment, machines, furniture, etc. These are assets that the company uses to assist its operations. There is a fixed number of assets at any given time, and assets typically fall under capital expenditures.
This technique is practiced to ensure:
- Assets are properly used.
- Proper asset valuation.
- Location of the asset.
- Increase asset life cycle.
Similarities between inventory and asset tracking
The intentions for using this concept are more or less the same. Both inventory and asset management ensures one key factor, which is improving productivity. A company that wants to sell things can use inventory management to make sure they have enough goods on hand to meet customer needs.
They don’t want to have too many goods on hand because items that aren’t sold before their expiration dates can go bad and no longer be sold. It can also lead to higher carrying costs because goods that sell slower than others can take up valuable warehouse space.
But they don’t want to have too few goods on hand, either, because that can lead to shortages and unhappy customers, among other things. Inventory management is the process of finding a balance between these two extremes.
Asset tracking can serve a similar function for large organizations in the construction industry whose primary focus is on providing services rather than selling products. They want to make the most of their resources so that they can help as many people as possible. They can maintain a balanced stock of assets by tracking their progress toward that goal.
Why is an it important?
It’s important to keep track of this inventory correctly and keep customers happy. The latest technology has made this very easy. Inventory management systems are helpful because they give retailers a clear picture of all their stock and make it easier for them to deal with things like stock allocation, having too much inventory, and other stock-related tasks. An inventory management tool helps businesses to;
- Increase profit margin: less waste of resources increases efficiency.
- Better resource management: the company makes purchases in the right amount.
- Detect problems fast: real-time monitoring helps detect problems quickly.
- Increase report integrity: the data will be more accurate, making well-informed reports possible.
- Improve customer satisfaction: effective demand planning helps keep up with customer needs.
Inventory asset tracking with CloudApper
An effective inventory asset tracking system will help companies perform better and be more profitable. The CloudApper Asset app is a no-code asset management app that will reduce costs. This cloud-based system allows users to monitor their assets’ activity in real-time.
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