What are consumables in the context of asset management?

Consumables in the context of asset management refer to the costs incurred for indirect materials that are consumed as a result of owning and utilizing an asset. This encompasses items such as maintenance supplies, tools, and other materials that are used up during the operation and upkeep of assets. Unlike fixed assets, which have a long-term use, consumables are typically short-lived and need to be replenished regularly.

Recognizing consumables as part of asset management is essential for accurate budgeting and cost tracking. It helps organizations monitor how much they are spending to maintain their assets and ensures that they can assess the total cost of ownership, which includes not just the initial purchase price but also ongoing expenses related to maintaining and operating the asset. This understanding can lead to better financial planning and decision-making regarding asset management strategies.