Fixed assets such as servers, transport trucks and elevators require a large capital investment. They may comprise a large portion of a company’s net worth. In some businesses, as much as 40 percent of investment goes to buying equipment and vehicles.(1)
The better and more effectively a company manages its assets, the greater the prospect of maximizing value from these investments. Without fixed asset management, an organization may experience:
- Unplanned downtime
- Equipment failures
- Misplaced or lost inventory
- Safety or environmental breaches
- Failure to meet compliance or regulatory standards
For companies with large inventories, the results may convert into millions of dollars in lost productivity, repairs, replacement or fines. Beyond immediate costs, substandard equipment can impact the quality of an organization’s services or products — in turn, affecting customer satisfaction and business reputation.
According to the ISO 55000 international standard, asset management should maximize value for money.(2) Ideally, fixed asset management improves the quality and useful life of equipment and ensures the best return on investment.