What is asset tracking and why do you need it?

Why asset tracking matters for tools and equipment

In this article, asset tracking refers specifically to tool and equipment tracking.

Asset tracking is the process of monitoring physical tools and equipment using tracking technology and software, helping businesses stay in control without adding unnecessary admin. For many businesses, it has become an essential way to reduce losses, improve utilisation, and maintain operational control across worksites, depots, and customer locations.

As organisations manage more mobile tools and equipment, manual registers and spreadsheets are no longer enough. Asset tracking provides reliable, real-time or periodic data that supports better decision-making and long-term cost control.

What is asset tracking?

Asset tracking is the use of technology to monitor the location, movement, and status of tools and equipment.

In practical terms, this includes items such as power tools, plant equipment, machinery, and other valuable assets that are frequently moved between sites or shared between teams.

At a basic level, asset tracking answers three key questions:

• Where is the tool or piece of equipment?

• Is it being used?

• Is it where it should be?

Modern asset tracking systems combine tracking hardware with software platforms that turn raw data into practical insight.

How does asset tracking work?

Asset tracking systems are made up of two main components: hardware and software.

Hardware: asset trackers

An asset tracker is a physical device attached to an asset. Depending on the technology used, it may transmit location data continuously or at set intervals. Trackers can be powered by batteries or wired into existing power sources.

Software: asset tracking platforms

Asset tracking software collects data and presents it in a clear dashboard so businesses can see asset locations, usage, alerts, and reports in one place.

In many cases, software works alongside physical trackers. However, some asset tracking platforms can also use tracker-less tracking by pulling data directly from original equipment manufacturers (OEMs). This means businesses can gain visibility into certain assets using built-in sensors and OEM data, without installing additional hardware.

Data typically flows into the platform via mobile networks, gateways, APIs, or OEM integrations, depending on the technology used.

Real-time vs periodic tracking

Some assets benefit from real-time tracking, such as vehicles or high-risk equipment. Others only require periodic updates, such as tools stored on-site. Choosing the right update frequency helps balance cost, battery life, and data needs.

3 main asset tracking technologies compared

Different asset tracking technologies suit different use cases. Below is a comparison of the three most common options.

How to choose the right technology

When selecting an asset tracking technology, consider:

• Whether assets are indoors, outdoors, or both

• How often location updates are required

• Power and battery constraints

• Cost of trackers and infrastructure

Many businesses use a combination of technologies to cover different asset types.

Main benefits of asset tracking for businesses

Asset tracking delivers clear, practical benefits across day-to-day operations.

Know where all your assets are

Instant visibility reduces time wasted searching for missing equipment and lowers the risk of theft or loss.

Improve asset utilisation

Usage data helps identify underused assets and avoid unnecessary purchases.

Enable predictive maintenance

Tracking usage and movement supports planned maintenance, reducing breakdowns and downtime.

Reduce operational costs

Fewer lost assets, less downtime, and better planning all contribute to cost savings.

Ensure compliance

Asset tracking supports audits, inspections, and documentation requirements.

Boost productivity

Teams spend less time searching for tools and more time doing productive work.

Industry-specific applications of asset tracking

Construction

Track tools and plant equipment across sites to reduce loss and improve accountability.

Manufacturing

Monitor machinery usage, maintenance schedules, and internal movement.

Facilities management

Keep control of shared equipment across multiple locations.

Transport and logistics

Track trailers, containers, and non-powered assets.

Plant hire

Improve asset availability, billing accuracy, and theft prevention.

How to choose the right asset tracking solution

Use the following framework when evaluating solutions:

1. Define which assets you need to track

2. Identify where and how assets are used

3. Choose suitable tracking technologies

4. Assess software usability and reporting

5. Check integration with existing systems

6. Review security and data compliance

7. Evaluate total cost of ownership

Must-have features checklist

• Accurate location data

• Clear reporting and alerts

• Scalable tracking options

• Strong data security

• Easy onboarding and support

Guide to implementing an asset tracking solution

Implementing asset tracking doesn’t need to be disruptive or complex. The most successful projects follow a clear, phased approach that focuses on real operational needs rather than technology alone.

Phase 1: Planning

Start by being clear on why you are implementing asset tracking.

At this stage, businesses should:

• Define clear goals (for example, reducing tool loss, improving utilisation, or cutting downtime)

• Decide which tools and equipment will be included in the first phase

• Identify success metrics such as reduced replacement costs, fewer lost items, or time saved on searches

• Involve key stakeholders early, including operations, site managers, and finance

Keeping the initial scope realistic makes it easier to prove value quickly and build internal support.

Phase 2: Selection

Once goals are clear, the focus shifts to choosing the right technology and software.

This phase should consider:

• Where tools and equipment are used (indoors, outdoors, or across multiple sites)

• Whether assets need real-time or periodic tracking

• Battery life, installation effort, and maintenance requirements

• How easily the system fits into existing workflows and systems

The right solution should support day-to-day operations rather than create additional admin.

Phase 3: Deployment

Deployment is where planning turns into action.

Typical steps include:

• Attaching trackers or activating tracker-less tracking where available

• Grouping assets logically within the software (by site, team, or asset type)

• Setting up alerts, reports, and access levels

• Training users on how to find assets, interpret data, and act on insights

A short pilot phase can help identify issues early before rolling out more widely. At this stage, it’s worth favouring providers that offer structured onboarding and dedicated account management, as this support can significantly reduce friction during rollout and help teams get value from the system faster.

Phase 4: Optimisation

Asset tracking delivers the most value when data is reviewed regularly and used to improve processes.

Ongoing optimisation may include:

• Reviewing reports to identify underused or frequently moved tools

• Adjusting alert thresholds as usage patterns become clearer

• Using insights to improve purchasing, maintenance, and allocation decisions

• Expanding tracking to additional tools or sites over time

By treating asset tracking as an ongoing process rather than a one-off project, businesses can continue to increase value long after initial implementation.

ROI and cost-benefit analysis of asset tracking

The cost of asset tracking typically includes trackers, software licences, onboarding, and setup. In return, businesses see savings through reduced loss, improved utilisation, lower downtime, and less time spent searching for missing tools.

For tool and equipment-heavy industries, replacement costs are a major factor. In the UK, research consistently shows that replacing lost or stolen tools can cost thousands of pounds per incident, and many businesses experience repeat losses over time. Without visibility, these costs quickly add up and are often accepted as part of doing business.

By reducing losses, improving planning, and extending the useful life of tools and equipment, asset tracking can deliver a fast return. Many businesses see payback within months, particularly where asset loss, duplication, or inefficiency has been an ongoing issue.

Track your assets with ABAX solutions

ABAX provides asset tracking solutions focused on tool and equipment tracking, designed to give businesses full visibility while keeping things simple and easy to manage.

ABAX Locator enables tracking of tools and equipment across sites, helping reduce loss, improve utilisation, and support day-to-day operations.

ABAX Worksite provides visibility at site level, helping businesses understand where tools are located and how equipment moves between worksites.