Cover Your Assets

Being in the Business of Helping organizations create better processes to control their inventory, I found it ironic when an insurance adjuster told me I would have to perform an inventory of my personal assets after a fire destroyed my home in 2004.

“You know, the number of televisions, DVD players, computers, stereo equipment, etcetera, that you owned,” the adjuster said as we were walking through what was left of our home. At first I thought this would be a piece of cake.

But the adjuster went on to say that he needed a list of everything, because it’s the information on that list that the insurance company uses for my reimbursement check. That meant all the makes, models and serial numbers of the items; any photographs of my assets; any receipts we had; and the purchase date of each item.

It dawned on me just how complicated taking inventory after a fire is — and what this means for businesses. A $100 million company will have an inventory value ranging from 6% to 20% of its topline sales, or $6 million to $20 million. That’s a lot to lose in one fell swoop!

Would your organization be able to produce a list of its assets? The sellable inventory probably, but what about the number of desks, chairs, computers, fax machines, paintings, cubicles, filing cabinets, telephones, cash registers, bookshelves, racks and forklifts?

Back to my house fire: It took us more than two years to receive our final payment, which was only 55% of the total value of everything we owned. Believe me, when you are forced to create an inventory from memory, you’ll wish you had taken the extra time to cover your assets.
RENE JONES
FOUNDER, TOTAL LOGISTICS SOLUTIONS

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