Nearly every crop producer, livestock operator or ag processor I know has a good handle on the production side of the business. They understand crop cycles, herd dynamics and facility equipment better than anybody.
But good production skills aren’t enough to achieve profitability in an industry as complex as agriculture has become. Volatile prices, trade-war impacts, labor requirements, increasing regulations, supply-chain disruptions, tax changes—all can move the needle for you, your suppliers and your customers.
“The world is speeding up and margins have been getting smaller,” said my colleague, Chris Haverkamp, a partner with KCoe Isom. “Ag businesses need good data captured in a timely, efficient and accurate way so they can make better decisions.”
Enter the latest financial technology that allows ag businesses to integrate multiple, detailed layers of their operations and see the big picture in ways they couldn’t before. The result? Improved insights that can lead to greater business success.
These cloud-based systems capture the diverse data of a business in a digital format. They transfer that real-time information to a central platform where it’s stored. There, it can be analyzed quickly and easily with farm management software.
These new data-gathering platforms, Haverkamp added, empower producers and processors with the knowledge they need for comparisons, improvements and even the future. By bringing together farm, operational and accounting data, a manager can achieve efficiencies and insights that wouldn’t otherwise be possible.
Here’s an example of what these data-gathering platforms can do. Say you have eight tractors that require maintenance and repairs. “You could compare what you’re spending on those tractors with projected costs to increase your fleet with equipment that’s newer and has greater horsepower,” Haverkamp said. “You might find that you could upgrade your fleet with more efficiency, reduced fuel needs and higher output if you bought six new tractors and got rid of the eight old ones.”
The same kind of assessments and comparisons can be done with crop yields, fertilizer costs, received prices, livestock traceability, irrigation electricity expenses, transportation, warehousing, payroll, sustainability programs and rates of return—the list goes on and on.
Want to figure out if your investment in yield-boosting products actually made you more money? Need to track the cost of fuel and labor and even run some “what if” scenarios? Want to understand where your profit centers are? Interested in benchmarking your operation against others in your area or sector? Today’s sophisticated financial technology does all that and more.
Until now, ag producers have faced a disconnect between the key metrics they can collect and the next step of what to do with it. The good news is these high-tech data platforms bridge that gap. They take your data, centralize and manage the information, and get you the end results you want. They have also become easier to navigate.
In short, advanced financial technology can transform your managerial insights and lead to better decisions and greater profitability. Talk with an expert with a good team to learn more. Putting this kind of technology to work is the next level of management to help your ag operation succeed.
Editor’s note: Maxson Irsik, a certified public accountant, advises owners of professionally managed agribusinesses and family-owned ranches on ways to achieve their goals. Whether an owner’s goal is to expand and grow the business, discover and leverage core competencies, or protect the current owners’ legacy through careful structuring and estate planning, Max applies his experience working on and running his own family’s farm to find innovative ways to make it a reality. Contact him at