How to improve the financial management of your farm in a few, simple steps

by Michele Peluso | Jun 8, 2022 | Farm, Finance

xFarm has created the Financial module to help you simplify the financial management of your farm. By analyzing the data you collect, the xFarm platform will allow you to compare vintages, techniques, crops, plots and much more, identifying possible savings and evaluating the effectiveness of your investments.

The financial management of agricultural activities is difficult: due to the various and complicated cost and investment items, the calculation of the final cost of the product of a farm is a real challenge. Furthermore, all the burden often falls on the shoulders of the farmer, who is also the entrepreneur.

Here at xFarm, we believe that efficiency and sustainability are also important at an economic and financial level. Because of this reason, we decided to develop the Financial module.

The Financial module allows you to view the major cost items for each crop, understand which areas of the company provide the most profit, map the revenues, costs, and income for each plot in such a way as to have a more detailed view of what happens in your farm, simplifying your work.

Starting to use the Financial module is simple: you need to enter the costs (hourly cost of labor, invoices for the purchase of products and other expenses) in as much detail as possible, record the revenues from the sale of your products, from subsidies or from other sources of income and report the activities carried out in the field. In order to have an estimate as close as possible to the reality of the costs incurred, it is important to enter these data in as much detail as possible.

1. The financial situation of your company at a glance

The first function of the Financial module is called Overview. This function provides graphs and tables that allow you to quickly visualize the trend of costs, revenues and profits, even broken down by crop. In this way you will be able to see a snapshot of the financial situation of your company and quickly understand which crops are making you earn the most.

2. Invoice register? Go digital

Under Costs and Revenues, you can digitally record the invoices issued for the purchase of products and services and report collected revenues. In this way you will always have the company’s economic situation under control and you can use a digital and tidy accounting notebook to which you can refer at any time rather than always having to waste time making calculations or looking for paper invoices.

3. View and understand the business cost structure

Under Operating Costs you will find important information about the cost structure of your farm. Costs are divided by type (Machinery, Personnel, Operations), in order to assess which stages of production have the most impact. The information you can consult is very detailed. For example, you can understand how much each machine costs per hectare worked or per hour of work, the hourly cost of personnel and the cost of the various operations performed in the field.

4. Know where you are earning the most

The Visual function provides a visual summary that allows you to quickly find out which plots are providing higher revenues, costs or income. In this way, you can understand where your company is earning the most.

5. Find out which crops are the most profitable

The Crop Margins function allows you to quickly view costs, revenues and profit margins for each crop and for each field. This constitutes useful information to plan crop rotations or to choose, among the different varieties, the most profitable one.