“All progress takes place outside the comfort zone.” Michael John Bob
Part three of this three-part series will touch on the remaining four elements necessary for an efficient asset/property management system. Click here to read part 1, and here to read part 2.
Part 1 discusses the property elements of:
- Property Management
- Acquisition of Property
- Receipt of Property
Part 2 discusses the property elements of:
- Records of Property
- Physical Inventories
- Sub-contractor, vendor, supplier control
- Reports of property
Lets get started with our latest installment.
Utilization
The element of utilization is a very important element as it covers several subcategories. This element includes the using, consuming, moving and storing of your company property only as authorized by your procedures. For example, it would not be good use of your company assets if employees were using them for their own personal gain. How would you feel if your employees (which might be you yourself) are adding undue wear and tear to your company truck, saws, or other pieces of equipment. Worse yet, how would it effect your company (and your pockets) if employees misuse and abuse your material such as paint, cables, lumber, or whatever your materials consist of?
Establishing well-defined utilization procedures and processes enable your company to separate business expenses from personal expenses, while reducing the risk undertaken by your company. Conducting internal audits/assessments/analysis of your asset utilization can help reduce waste, and increase effectiveness; all of which increase your bottom line and profits by reducing your costs.
Very few economies have an insolvency system with both high efficiency (a recovery rate of more than 50 cents on the dollar) and low quality (a score on the strength of insolvency framework index of less than 8 of the possible 16 points).
Doing Business 2015 by The World Bank
Maintenance
It should go without saying that companies often seek to increase 
profits by reducing costs. Increasing profits should not however mean decrease value-adding expenses such as conducting preventive maintenance on your assets. Truth be told, it is often more expensive to replace your equipment than it is to maintain it. Establishing a well-rounded property/asset management system includes a thorough maintenance plan. This maintenance plan should include the identification, disclosure, and performance of normal and routine preventative maintenance (to include calibration) of your equipment.
profits by reducing costs. Increasing profits should not however mean decrease value-adding expenses such as conducting preventive maintenance on your assets. Truth be told, it is often more expensive to replace your equipment than it is to maintain it. Establishing a well-rounded property/asset management system includes a thorough maintenance plan. This maintenance plan should include the identification, disclosure, and performance of normal and routine preventative maintenance (to include calibration) of your equipment.The scope of your maintenance plan will vary by the intricacy of your equipment, but most commercially off the shelf items (equipment you can purchase commercially) includes a preventive maintenance plan you can easily track on a periodic basis. Use my workshop as an example, our vehicles’ preventive maintenance plan is nothing more than the OEM recommended maintenance which we log on an excel spreadsheet and review monthly. Preventive maintenance for our woodworking equipment varies by use, all of which are also maintained on a simple spreadsheet and evaluated monthly.
Disposition
As with most businesses, planning of byproducts, waste, and end 
item lifecycle can make or break a company. What type of waste (scrap, material waste, hazardous, etc.) are you creating, and how do you dispose of it? Is there a way you can benefit or profit from the waste you’re creating? For example, one of my companies repurposes pallet woods and creates rustic wooden items such as clocks, beer totes, and wine racks. Material scrap such as metal shavings can be sold to a scrap yard for a few dollars. Lastly, you may be able to gift or donate items that are excess to your needs and perhaps earn a tax deduction. Did you upgrade your computers or lawn mowers? Did you acquire a new printer, an upgraded trailer, a new bandsaw? You get the point. Can you think of a way your business can reduce waste and maximize profits.
item lifecycle can make or break a company. What type of waste (scrap, material waste, hazardous, etc.) are you creating, and how do you dispose of it? Is there a way you can benefit or profit from the waste you’re creating? For example, one of my companies repurposes pallet woods and creates rustic wooden items such as clocks, beer totes, and wine racks. Material scrap such as metal shavings can be sold to a scrap yard for a few dollars. Lastly, you may be able to gift or donate items that are excess to your needs and perhaps earn a tax deduction. Did you upgrade your computers or lawn mowers? Did you acquire a new printer, an upgraded trailer, a new bandsaw? You get the point. Can you think of a way your business can reduce waste and maximize profits.Related Content: The Parable of The Benevolent Uncle
Contract Close-Out
Lastly, a very important part of controlling the property and assets 
in your possession includes contract close-out. Did you furnish your vendor with a forging/casting, tools, equipment, material to accomplish a job? Who has the rights to these items at contract completion? Did you submit the final payment to your subcontractor/vendor?
in your possession includes contract close-out. Did you furnish your vendor with a forging/casting, tools, equipment, material to accomplish a job? Who has the rights to these items at contract completion? Did you submit the final payment to your subcontractor/vendor? Thank you for taking the time to read this three-part series detailing the benefits of utilizing the FAR 52.245-1 as a roadmap or guidebook to establishing your very own property/asset management system.
I look forward to bringing you relevant, actionable content you can use to start your new business, and help improve the management of a business you already operate. Feel free to sign up to the upcoming monthly eNewsletter by entering your email on the eNewsletter sign up block on the sidebar.
If you have any questions, concerns or additional tips to share, please let me know! You can email me directly at Angel.Rosario@SmartBizPractices.com or contact me through the social media links listed below. You can even leave a comment on the comment box and I’ll reply fairly quickly.
Best regards,
-Angel