While running a small business can be incredibly rewarding, doing so effectively will require a lot of time, effort and dedication. Alongside common issues like supply chain disruptions, recruitment and global economic fluctuations, modern business owners must contend with a variety of technological and logistical challenges born from an increasingly connected world.
No matter the size of an organization, the ability for teams to accurately monitor, analyze and review how key assets are utilized is often central to a business’ success. For stakeholders to optimize core operations, improve efficiency and outperform direct competitors, accurate data pertaining to materials, inventory and equipment must be readily accessible at all times.
Despite the growing availability of intelligent inventory and asset management solutions, it’s believed as many as 43% of businesses either don’t track inventory at all, or do so manually. Without access to accurate asset data, it can be difficult to truly optimize operations. To help teams overcome this, below is a guide to inventory asset management for small businesses.
What is inventory asset management?
Inventory asset management refers to the combined monitoring of a business’ raw materials, saleable inventory and key resources such as equipment and machinery. By developing an inventory asset management system, business owners look to centralize important data like stock levels, maintenance records and production plans to gain a holistic view of operations.
The main objective of inventory asset management is to provide stakeholders with accurate information regarding key business processes, helping teams to both identify inefficiencies and improve overall productivity. For an asset management strategy to be effective, it must:
- Compile asset data into a single easily accessible platform
- Track the physical location of assets like raw materials and saleable inventory
- Monitor how assets like machinery and equipment are commonly used
- Track the performance of essential assets like machinery and equipment
- Monitor maintenance schedules to ensure assets are regularly assessed
- Track the lifecycle of assets to inform future upgrades and procedures
Why is inventory asset management important?
To succeed in competitive markets, small business owners must be able to identify areas in which improvements can be made. By developing a system in which all essential assets are continually and automatically monitored, precise optimizations can be realistically pursued.
Creating a bespoke inventory asset management system enables small business owners to:
- Improve accountability – Inventory and essential equipment can be accurately monitored in transit, helping stakeholders to ensure assets are used appropriately
- Mitigate losses – With live records pertaining to the use and location of key assets, small business owners can significantly reduce the likelihood of inventory theft
- Optimize maintenance – Computerized inventory asset management systems help teams to plan maintenance tasks around production needs to reduce downtime
- Reduced administrative burden – Automating asset management activities reduces the administrative burden shouldered by workers so staff can focus on complex tasks
3 ways to improve asset management processes
While it is possible to perform some inventory asset management tasks manually, many modern businesses choose to utilize computerized systems. Smart inventory management systems can be customized to suit the unique needs of different businesses, providing staff with key data insights and automated alerts to help optimize asset management processes.
1. Develop a cloud-based management system
By integrating all inventory and asset management solutions into one cloud-based platform, business owners gain access to live asset data from any location. If any aspect of the supply chain, resource allocation or production process changes, relevant stakeholders can be told immediately, with the ability to review historical data to make informed decisions in response.
2. Analyze asset data using AI-informed tools
Modern smart inventory management systems often utilize AI-informed data analytics tools to help teams better understand collected data. AI tools can be configured to monitor stock levels and equipment usage in relation to live and historic market demands, helping teams to optimize material procurement and production scheduling processes to maximize efficiency.
3. Track assets via the Internet of Things (IoT)
To ensure asset tracking data is accurate, businesses will need to develop some form of live inventory monitoring system. IoT sensors can be used to automatically scan assets as they move throughout facilities. Using a combination of installed sensors and chips implanted into key assets, live data can be instantly sent to a cloud-based management system for review.
Summary
For small business owners to remain competitive within modern markets, leaders must find ways to continually maximize general efficiencies. By developing automated inventory asset management systems, teams gain a more holistic view of asset usage, enabling managers to adjust core processes based on data-driven insights to reliably optimize wider operations.
