Business management: tangible and intangible assets

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As a business owner, you play a determinant role in everything that could put you on the road to success, from human resources and customer service to business planning and marketing strategy. You cannot fulfill these great responsibilities if you cannot interblend perfectly due diligence, organization and research. However, the most important task of all remains keeping track of your assets because overlooking it could lead to significant losses, in terms of money and time. When it comes to business assets, the main goal is to obtain the greatest result while saving as much funds as possible, all while maintaining or even prolonging the asset’s lifespan. If you think that only government agencies and large corporations practice asset management, you are terribly mistaken. In fact, as a small business owner, you should know that tracking your assets is crucial for identifying loss, when it happens. You need to determine when you should replace certain assets, identify assets that you are not exploiting enough and decide which would be the most intelligent investment for business operation.

Fixed business assets management

Undoubtedly, property & asset management is extremely important. Those people who are not familiar with the best practices for asset management should pay close attention to this article. Starting with the first type of assets, known as tangible or fixed assets, they practically refer to commercial space, vehicles and equipment, which you cannot consume while running your business, but they still face depreciation over time. Usually, they appear on the Balance Sheet as Plant, Property and Equipment. Most of your tangible assets are fundamental for business operations. Fixed assets management consists in staying up to date with key details like the condition and quantity, location, depreciation status and maintenance schedules. More specifically, knowing about the location of your tangible assets becomes imperative when you also become responsible for a second business location, knowing about the quantity will help you decide when you should buy more, assessing the condition is important for scheduling maintenance and determining small business valuation.

Intangible business assets management

Intangible assets do not have a physical form. They include industry knowledge, business reputation, name recognition and company skills. Protecting your assets reduces potential risks that your business could face. You do not only eliminate efficiency, but you also maximize the safety and health of your business. Even though you cannot find these assets on the Balance Sheet, it does not mean that you should not give them your maximum attention. In fact, intangible assets contribute to your business’ credibility. Imagine that at some point you would want to sell your business. Well, this type of assets has the power to increase its value and attract more prospective buyers. Estimating the value of your intangibles is equally important as protecting them. However, you should not do this on your own. Working with a business broker or consulting a professional appraiser will give you a more accurate evaluation. The main goal with intangible assets is to increase their value while creating new ones.

August 2022