Tangible asset

A tangible asset is physical property - it can be touched. The term is most commonly associated with fixed assets, such as machinery, vehicles, and buildings. It is not used to describe shorter-term assets, such as inventory, since these items are intended for sale or conversion to cash. Tangible assets comprise the key competitive advantage of some organizations, especially if they use the assets efficiently to produce sales.

Tangible assets are frequently used as collateral for loans, since they tend to have robust, long-term valuations that are valuable to a lender. These assets typically require a significant amount of maintenance to uphold their values and productive capabilities, and likely require insurance protection.

The opposite of a tangible asset is an intangible one, which is not physically present. Examples of intangible assets are copyrights, patents, and operating licenses.

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