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What the Search for Assets Really Costs Companies and How Real-Time Location Services can Remedy the Situation
When looking for a suitable asset tracking solution, customers always ask about the costs of the technology itself, the installation and the maintenance. Sometimes it seems like they are afraid of increasing costs over time mainly due to a perceived high maintenance effort, so the inhibitions to choose a RTLS solution is still very high. To demonstrate how organizations can truly profit from real-time asset tracking solutions, it is at first necessary to add up the costs incurred by employees an their daily search for assets.
30.000 € per year: this is what it costs to search for assets every day
To illustrate the situation a little more clearly, we have used real data from a large car repair shop with an average of 200 cars on its premises – give or take 50 per day. The cars stay on the premises for an average of 3 working days and about 150 of them are moved per day.
The company has 62 employees and each of them spends about 10 minutes a day searching for the right car. With an annual average of 220 working days, that is 136.400 minutes of search time or about 30.000 € in monetized costs.
And this is not an exceptional case. This figure can easily be applied to the day-to-day business of companies in industrial manufacturing, construction, logistics, and even the healthcare industry. Because in each of these industries, employees spend enormous amounts of time searching for important equipment or items, which ends up costing them not only time but above all money.
By comparison: this is what a high-quality, high-precision asset tracking solution costs
In the case of the car repair shop an accuracy down to 1,5 m was required to clearly identify each single car. For use cases like this Favendo uses the AoA method of its partner Quuppa for positioning. By using the Angle of Arrival method, sub-meter positioning accuracies between 0.1-1 m can be achieved with Bluetooth technology.
The entire RTLS solution for this specific use case, including hardware, tags, software, installation and roll-out service, and licensing costs, amounts to a total cost of approximately 31.000 €. Roughly the same as the search times. The only difference is that the search times can now be put to productive use, giving employees a total of 136,400 minutes more time.
The result: An investment that already pays off in the second year
The installation already pays off on the cost side in the second year. This is because only the annual license costs and, if applicable, maintenance and software updates are incurred. However, these costs are significantly lower than the ongoing costs of the search for assets.
The longer and more intensively the tracking solution is used, the higher the costs saved. And in the long run, you will benefit from the one-time investment in a real-time asset tracking solution, even it may seem high at the beginning.