Irregular stocktaking and occasional thefts: why companies keep losing assets and how to solve it

Asset clutter plagues businesses around the world. For example, according to research by Telsyte, Australian businesses lose an average of $4.3 billion in assets a year, which is like losing 3 million computers. Companies should realize why losses occur and how to reduce their number. Every lost item costs money and adds work to people. In the article, we will introduce you to the most common reasons why companies lose property, and how they avoid these situations using modern technologies and processes.

1. Irregular stocktaking and outdated procedures

A lot of companies still carry out stocktaking the old way. They print out a list of goods or assets and go from shelf to shelf or office to office, checking things with their eyes and crossing them off with a pencil. This can work in a small office business. But if the company sells goods, stores tools or runs production, the stocktaking drags on and the risk of employees making a mistake increases.

Because manual stocktaking shuts down a part of the business for days to weeks, companies tend to put it off. And with each delayed stocktaking, the risk that assets will be lost in the meantime increases.

Today, companies make laborious stocktaking easier with technology. For example, in the barefoot footwear e-shop Bosonožka, the manual stocktaking of 30,000 pairs of shoes used to take one month. After the introduction of barcode readers connected to the warehouse system, they will process the stocktaking in 2 days. Employees walk through the warehouse with readers that navigate them through the warehouse, read all the codes, and the system then matches the goods with the inventory in the software.

These technologies are increasingly being used in the stocktaking of assets other than goods. For example, companies assign barcodes to tools or office equipment and simply walk around with a smartphone and scan the codes during stocktaking.

2. Incorrect or non-existent records

Many companies register their assets only in the form of accounting records, which are required by law as part of tax records or accounting. But they serve only for tax purposes and keep only a minimal overview of the assets.

The accounting records of assets do not contain, for example:

• current location,
• usage history,
• service history
• or, expiration date.

As a result, even though companies have an idea of what assets they own, they have no idea where they really are and what has happened to them over the past years. At best, they discover that the asset has been lost during stocktaking, at worst, when they need it.

Companies that want to keep an overview of their assets handle records, for example, by assigning a registration number to each item and, whenever the status changes, they write down who is currently using the item or where it is in a table. Some companies automate the registration by marking files, tools, chairs and other property with barcodes that they read with a mobile phone or a reader connected to the registration system.

The advantage is that these solutions are applicable in most fields. For example, this is how they use it in an accounting office: „Some clients still deliver documents to us in paper form. After their digitization and ending the accounting period, we move these paper documents to the archive. We use simple software to manage it, where each archive box has its own barcode and its own position. We know exactly when the archive box was created, where it is located and how it was handled,“ says Milan Bančanský, IT director of accounting and tax office ASB Czech Republic.

3. Frequent use without clear rules

Asset is lost a lot where it often passes from hand to hand. It can be, for example, a service that lends electronics to customers, or a construction company where dozens of workers hand over a jackhammer in a month. If such a company does not have clearly set processes for the transfer of assets, it loses overview of them. Employees put things away where it's convenient for them, and chaos grows.

Smaller companies solve the circulation of assets with an Excel spreadsheet, larger ones have specialized functions in information systems for these purposes. The latest trend is cloud tools with mobile devices.

For example, in the aforementioned construction companies, it is common today for workers to have applications on their mobile phones, which they can use to scan the barcodes of tools in the warehouse. The application records who borrowed the tool and when, so everyone has an overview of where each tool is currently located. And if it gets lost, the manager quickly finds out who had it last.

The same methods can be applied not only to workers in the field, but, for example, to home office clerks who borrow work equipment for home.

4. Thefts

Some asset is lost by mistake, another is "lost" when an employee, customer or even a random passer-by appropriates it in a moment of inattention. It's a touchy subject, but it happens a lot—and it will happen even if you have a more advanced asset tracking system in place.

The difference is that with asset tracking technologies, a business can more easily trace how the theft occurred and increase its chances of compensation, or better yet, deter the potential criminal.

The resolution of theft then looks like this:

• the manager finds in the records where the tool was last seen or who had it with him,
• they look at the camera recordings or interviews the person who had the item with him,
• for more expensive property equipped with a tracking device, they immediately find out where it is currently located,
• and thanks to the fact that everyone in the company knows about these records, it deters some potential thieves.

Of course, asset tracking technology won't prevent theft by itself. Companies should also invest in the security of the establishment, camera systems and other security measures.

Get advice on how to get started with smart asset records

Asset tracking is common abroad, but not so widespread in the Czech Republic. At the same time, these tools are available on the Czech market - including simple cloud applications that are cheaper than, for example, accounting systems and can be deployed in a matter of hours.

If you also want to clearly record and monitor your property, contact us. We have implemented the mentioned solutions in dozens of small and large Czech companies. We will discuss your requirements for smart asset records with you without obligation and help you find suitable technologies.

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