Asset Inventory – A Valuable Business Tool

As a business owner, you know the importance of being able to recover from a loss, so you have an inventory created of all of your business assets. These losses can come from fire, theft, or natural disasters. Catastrophes are happening more frequently, and in areas where people wouldn’t expect them.

SuperStorm Sandy is a prime example. I doubt if you could find one person who ever thought they would face such a loss! Businesses were out of business – some forever. Others are recovering, but it’s been an extremely slow, painful process for most. Imagine the difficulty of doing your best to remember and list all the assets owned by these businesses! Many weren’t allowed back, so even though their assets were still in the building, they weren’t permitted go there to help create their list of losses. What a difference it would have made if they had an already-prepared list of the business assets!

That in itself is worth having an asset inventory. To help make it even a wiser process in which to invest, consider that one day you look around for some trade show or other type of infrequently-used items. Unable to locate them, you prepare to purchase new. Then you realize if you DO own them, you’ll have them listed on your inventory, and in what closet or storage area. Checking the records, you verify you do still own them, saving your company possibly thousands of dollars of unnecessary expenses. Your disaster preparedness inventory has just been repurposed into an asset locator!

As the economy continues to struggle to recover, many small business owners have difficulty making payroll once in a while. Or, you need a new piece of equipment and don’t have the available cash. Either of these scenarios, and others, show another opportunity to use your asset inventory. Most banks today require a list of all assets before approving a loan or line of credit. Your inventory is already prepared, so you’ll be able to speed up the loan process, enabling you to receive your much-needed cash as quickly as possible.

Another purpose for this business tool is to know if you’re sufficiently insured. As businesses grow, many business owners don’t realize how much their asset base has increased. Keeping your inventory up to date will enable you to discuss your insurance needs with your insurance agent. Finding out, after a loss, that you were grossly underinsured is not the time to discover this oversight. Being able to recover financially from a disaster is a must to keep your business afloat.

An asset inventory of all the items your company owns serves many different purposes. It’s a business tool that is essential for all companies.