Asset Tracking vs Inventory Management
Knowing the difference between Asset Tracking and Inventory Management can help the reporting of your company in ways you would not believe. The names can be deceiving. Every piece of inventory is an asset, but not every asset can be counted as inventory. Having the appropriate designations for each can help immensely, using the right software programs, with reporting your company’s profitability.
An asset is anything that is owned by your company with tangible value. This can be anything from a stockpile of office supplies to an individual within the company. Asset tracking is knowing what items of value a business uses, where they are, and who has them. This involves managing the location of internal resources needed in order to continue operating smoothly. Tracking items which are being lent out, keeping tabs on depreciation, and knowing the expiration on warranty contracts are all examples of asset tracking. Certain softwares, such as assetGEEK, allows the user to set timers on such warranties and can automatically calculate depreciation by using formulas set by data entry.
The inventory your company keeps can be described as the physical products your company offers and uses on a daily basis. Inventory management, then, must be the tracking of the products which are sold, consumed, and distributed, keeping track of receipts, storage, shipping and sales, and monitoring inventory returns and stock levels to determine future orders. Having a system which an accurately track the inventory both incoming and outgoing can make the task of ensuring distribution cycles operate smoothly is crucial for a number of businesses. Such software can even track the revenue gained from each sale, showing where the most money is being made in goods and services.
Knowing the difference between the two, assigning the appropriate financial valuation, and being able to see how those values affect the overall corporate structure help in leaps and bounds for any company. These values can help determine the profitability or loss of any given product and service.