Why You Must Use Barcodes to Avoid Disaster

Barcode Technology Needed To Prevent Inventory and Asset Management Disasters

Inventory shrink resulted in over $44 billion in losses for retailers in 2014, over 50% of it the result of internal theft, administrative errors, and unknown causes. The city of Houston and its public agencies, which includes county governments, two universities and the Johnson Space Center, recently acknowledged that over $5 million in property assets could not be located. Even the U.S. Marshals Service has lost track of at least 2,000 encrypted two-way radios and other communication devices valued at millions of dollars. Any business or agency that isn’t tracking inventory and assets may as well be throwing money away.   No one knows when disaster will strike, so it’s important to be prepared when it does.

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Asset management and inventory tracking are hardly the most exciting part of your business (unless you are like us at Wasp Barcode where we love the stuff), but they are among the most important. Assets and inventory make up a huge percentage of your company’s capital and can be particularly vulnerable to loss, especially from internal theft or honest mistakes. Both of which can be mitigated if not eliminated entirely by using best practices for asset management. Keeping track of your company’s physical assets should be as important as keeping track of your profits and bottom line.

Despite the importance of effective inventory management, for many small business owners inventory and asset management is an afterthought at best. Maybe they have a spreadsheet somewhere or a pen and paper list, but rarely do they create a real, functioning, up-to-date system to keep track of it all. However, barcodes and barcode scanning technology make asset and inventory management a simple task instead of a headache, and they are must use tools to avoid disaster.

Avoiding Asset Management Disasters

When you aren’t tracking your assets or inventory regularly you don’t know what you have or how much of it you have, you don’t know where it is, and you don’t know who used it last. What you do know is that you are headed for a disaster.


Related Article: The Ultimate Guide to Barcodes

Many of our customers find Wasp Barcode after such a disaster. These are some of the most common issues we’ve encountered from our customers over the years.

Audit

Some audits you know about in advance, but many you don’t. Either way they can take up a lot of time and human resources as well as being a major source of anxiety. They don’t have to be. What if you could be worry free when the auditor knocks?

Ganada Central School Disctrict (CSD) was using four weeks and two full-time dedicated employees each year to do a manual inventory and logging of all their assets. It was required for audits and to be sure their assets were accounted for. Even with the time spent and employees used, Ganada CSD Director of Technology Linda Lehman felt the process was slow, it was incredibly confusing and vulnerable to mistakes. As a result, Lehman, said staff “never really felt like they had it right.”

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Even worse, with her doubts about the master spreadsheet annual audits became a time of increased anxiety. Auditors would arrive at the office, ask for an inventory list, randomly choose five tech assets, and ask to be shown those items. The only thought in Tech Director Lehman’s mind, “I hope it’s there.”

Technology Director Lehman, realized she needed to fix this problem and began looking for solutions. She found barcode technology and Wasp Barcode’s Asset ManagementEDU. Since implementing the system, yearly audit anxiety is gone because Ganada CSD has achieved 99% asset managament tracking accuracy and with the new inventory database audit reports can be printed easily and quickly and confidently. In addition, the annual inventory process now takes 1 week instead of 4 and only requires 1 employee.

Lost Items and Internal Theft

Inventory shrinkage from internal theft, administrative errors, and unknown losses made up 57.1% of the $44 billion lost in 2014 from retail inventory shrink. That’s over $25 billion!

Now, sometimes items get lost by mistake, sometimes employees “lose” items on purpose. Either way, inventory shrinkage isn’t about blame as much as accountability. You can only hold people accountable for the loss if you can know that they were the last ones with an item. The only way you can know this is if you use barcodes and barcode labels to track assets effectively.

As a provider of security services, Paladin Security carefully screens its employees before hiring. With 135 people working and no system for accountability, management started to notice minor thefts and actual lost items, eventually leading to missing laptops worth $2,000, missing taser guns, and fuel cards.

“We were using an Excel spreadsheet to track our assets,” said Matt Carroll, a vice president and co-founder for Paladin. “This was far too difficult to manage our growing operation. Besides, the spreadsheet didn’t provide the immediate insight and reports we needed to rapidly take action.”

When items were misplaced, lost, or used inappropriately, it sometimes took days or weeks for the company to realize these problems.

“Once we knew an asset was missing, we spent even more time trying to figure out who had it last,” Carroll said. “We wasted hours literally chasing our tails looking for missing items. In today’s environment, we could hardly afford to lose high-dollar items such as laptops anymore.”

Carrol implemented a barcode based tracking system that allowed employees to check out and then check back in each item they used. This saved time and gave management and employees a sense of confidence about who was using what and made sure no one was anxious about theft or being accused of theft.

“Now, we won’t be losing expensive assets like computers and Tasers,” Carroll added. “We know who checked them out and when, plus our employees know it as well. Saving the potential loss of just one computer has justified the investment.”

Lack of Professionalism and Lost Customers

Every business owner’s nightmare, a customer calls and wants to know if you have a product or if their order is set and you can’t tell them because you don’t know. You look unprofessional and you run the very real risk of losing customers because you can’t meet their needs.


“With all the benefits we’ve experienced through Wasp, we plan on using the inventory solution well into our future.” -Jemima Spare, IT Support Officer, University of Oxford


Sometimes customers aren’t external they are internal, but still just as important to please. The University of Oxford’s 11 person Telecom Department manages over 28,000 phone extensions at university buildings spread throughout the city. Until recently, they were doing it by hand. It wasn’t working.

Without an effective asset management system, when a piece of equipment was taken from a stock room without record, it was nearly impossible to find it again according to Jemima Spare, IT Support Officer, University of Oxford. Once the department implemented a barcode based asset management solution they have the ability to see the activity of each item in the system and missing equipment can be easily tracked and invoiced.

Monster Trucks learn Asset Management

“Before Wasp, each person was probably wasting 2 to 4 hours a week tracking inventory.” Spare said, “Now, the department looks more professional. When someone comes in looking for a piece of equipment, we can instantly look at the database, see what we have, where it is and what we need to order without taking hours to locate something. With all the benefits we’ve experienced through Wasp, we plan on using the inventory solution well into our future.”

Wasted Resources

From employees time to spending limited capital on unnecessary inventory or assets, resources get wasted when you aren’t tracking your assets effectively. When you are running a small business you can’t afford to waste resources.

Racesource Inc. is a custom manufacturer of vehicle components for the racing industry and part of the race team for monster trucks Grave Digger and El Toro Loco. As Racesource grew, the volume of inventory quickly became too much to manage with an Excel spreadsheet. Excel isn’t able to track assemblies,  multiple items that can be used separately but when brought together make up one item/asset. Between their inability to track assemblies and the sheer quantity of inventory items to track, Racesource VP Paul Huffaker began to research inventory tracking solutions.

“Maintaining an accurate inventory count on Excel was time consuming and error ridden,” explains Paul Huffaker, Vice President of Racesource Inc. “Often I would reorder or manufacture parts I already had simply because I didn’t know I had them, which was an unnecessary cost. With many smaller items being combined into an assembly, I needed a system that could use the existing UPC codes to track the individual item as well as the assembly.”

Huffaker found that using a barcode based system would allow him to track items using their existing UPC codes and could keep track of assemblies. It was easier and quicker to use than Excel and it did the job better, saving his company money and avoiding the over order or under stocked disaster.

Why Wait For Disaster

You and your company are busy, and switching to an effective asset management solution may seem time consuming and expensive, but the reality is it isn’t. Barcode technology is affordable, easy to implement, and even easier to use. It saves time, money, and ensures that you know where your assets and inventory are.

There is no excuse to wait for disaster to strike, start smart and look into barcode based solutions for your company today.

 

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Brad Vinson

Brad Vinson

Product Marketing Manager at Wasp Barcode Technologies
Brad Vinson is a Product Marketing Manager at Wasp, responsible for development and execution of the MobileAsset solutions.
Brad Vinson
Brad Vinson