Asset Tags: Are They Necessary?

What are asset tags and are they necessary?

A warehouse worker scanning the asset tag of a product.

Asset tags are identifiers attached to items. They are typically labels. In addition to serving as unique identifiers for each asset in a company or organization, these tags can carry other data. For instance, a label can help with record-keeping for maintenance, repairs or access.

The unique identifier on each tag allows asset management software to track the location and status of individual items. Labels can help limit retail shrinkage by tracking inventory and help companies keep maintenance data for individual machines or parts.

Asset tags can streamline company operations by providing identification information and assisting with record-keeping. Here is how to decide if a label system can benefit your company.

Manual vs. automated asset tagging

Asset tagging can either be manual or automated. Manual tagging involves affixing labels to equipment and entering corresponding tracking information by hand. An example of manual tagging would be sticking barcodes on computers in an office and recording each code on paper or in a computer.

Automated asset tagging involves putting smart labels, such as radio frequency ID (RFID) devices, on equipment. These tags can send information directly to an asset management platform without human intervention. An example of automated asset tagging would be placing RFID devices in company fleet vehicles.

Manual asset tagging is a low-cost option that doesn’t require specialized equipment. It provides flexibility to organize your asset management system as you see fit. On the other hand, this option can be time-consuming and hard to scale if you have a large operation with many assets.

Automated asset tagging requires scanners, receivers and other equipment. Though this increases the price, it also brings more efficiency and scalability. This system can also reduce human error since data gets transmitted automatically.

What are the benefits of asset labeling?

The decision to develop an asset tagging strategy for your company depends on the benefits it will provide. Here are the advantages you can enjoy with a robust labeling system.

Accurate maintenance and repair histories: You can manage, schedule and track maintenance and ensure all equipment repairs are up to date.
Location tracking: You can track the location of assets. This assists with resource planning and helps avoid loss or theft.
Resource planning: You can maintain a complete picture of inventory and equipment to avoid redundant orders or purchases and to pinpoint where and when losses occurred.
Improve auditing accuracy: Auditors can use all the data created by an automated tagging system to assess the details of their operation to find errors, fraud and areas for improvement.
Informed strategies and changes: The data from asset tagging can help with decisions about resource purchases, operational changes and process improvements.

Labeling can also help track warranties and lifespans of equipment or measure the shelf life of inventory to limit unnecessary spending and waste.

Types of asset tagging

Asset tagging can be as simple as a nameplate with an identifying number, or it could be as sophisticated as a sensor sending real-time information to an asset management platform.

Here are the four most common types of asset tagging.

QR codes

Individual using their phone to scan a QR code.

A quick response (QR) code contains data in a series of black-and-white forms inside a square. Once you scan it with a specialized device or smartphone camera, it connects to an application or database that displays information.

QR codes are compatible with standard mobile devices, so they do not usually require specialized equipment. Users can view necessary information right after scanning, making QR codes convenient for hospitals or manufacturing facilities where data can help with operational decisions.

Barcode tags

A barcode label on an electronic device.

Universal product codes (UPCs), more commonly known as barcodes, are a series of vertical lines of different thicknesses. Like QR codes, barcodes contain information. They require a specialized device to read and transmit information to asset management software.

Barcode tags are simple and easy to attach. They are cheaper to deploy than RFID tags or other systems relying on tech. Since they don’t contain as much data, they are more secure than QR codes, but the amount of information each barcode can hold is significantly less. However, if you only need identifiers, barcodes are sufficient.

RFID tags

A universal asset tag mounted on a metal box.

RFID tags send information over radio waves. The devices are attached to equipment, tools or inventory shipments. Unlike QR codes and UPCs, they do not require manual scanning. They transmit data directly to an antenna and reader, which transfers the message to asset management software.

RFID tags may be more expensive, but they allow remote access to information. You can automate data collection and asset management, increasing efficiency and offering access to identifying information regardless of location.

BLE asset tags

Bluetooth low-energy (BLE) tags rely on Bluetooth technology to track assets and transmit data. The tags are energy efficient and have a signal range of 300 feet. They are not ideal for long-range vehicle tracking or other tasks, but they offer wireless data transmission in a factory, office or warehouse setting. They can be transmitted to consumer devices like smartphones.

Potential applications of asset tagging

Asset tagging has different applications. Here are some of the most common.

Tracking inventory in a warehouse or retail store;
Verifying shipments;
Locating assets;
Accessing maintenance and repair schedules and histories;
Identifying unique assets;
Managing resources.

The best tags for your needs depend on the applications.

Which assets require tagging?

You may want to tag high-value assets or items vital to your business operations.

Individual goods in your inventory;
Pallets or boxes of goods;
Equipment for manufacturing or office use;
Tools necessary for business operations;
Fleet vehicles;
Important parts;
Systems necessary for workplace safety compliance.

You might consider tagging items that will be part of the safety of compliance audits to streamline the reporting process.

Risks of not using an asset tag

Small and mid-sized businesses may think asset tags are unnecessary. Even with limited equipment, the labels can help with record-keeping, compliance reporting and maintenance scheduling.

Here are some of the issues that could arise without asset tags.

Inaccurate inventory reports;
Increased theft or fraud;
Inability to track lost parts or products;
Lack of distinction between similar parts or machinery.

Simple barcode labels or name plates can help you identify equipment to assess maintenance and check warranty coverage.

Tips for choosing an asset tag

You can choose the best type of asset tags for your company based on your needs. The first step in the selection process is defining what those needs are. If you have movable assets, for instance, RFID tags may be the best option. If you need to store maintenance data for easy access, QR tags could be a more cost-effective option.

Be sure to account for factors like durability, price and reputation of the vendor supplying the labels.

Finally, you need to consider asset management tools like software, specialized readers or smartphone applications that can scan codes or receive signals. Once you have all these components in place, you can enjoy the benefits of asset tagging in your company.