Farm software should give you the information you need to make major financial decisions.
Examples of major financial decisions for your family farm would include things like a large expansion of the operation, taking on a new partner, producing a new product or commodity, or adopting new technology. Does your current farm software identify strengths or weaknesses in your operation, allowing you to make a correct assessment of the rewards and the risks involved in your choice?
One of the first questions you should consider is whether the software can provide sufficient historical information to adequately evaluate past performance and project the likely future performance of your operation. Can it identify trends over a 5-year period or longer so you can identify historic ups and downs in your operation? Does the software project future revenue and expenses for a 3 to 5 year period to create a well founded prediction of cash flow?
Units That Match Your Needs
Your farm software should provide you detailed projections that accurately match the units (e.g., acres, bushels) being evaluated. If you’re analyzing crop expansion, are you able to enter each farm or field to obtain accurate sums of the units of the expansion? If your decision involves livestock, does the software allow you to enter work in various stages of production in both head and weight units?
Clear & Valuable Data
When you enter all your planning in the software, does the reporting give you meaningful data to form a solid foundation for your decision? Does the program give you measurable steps to take along the way, providing budget-to-actual data as well as a look at the remaining budget?
With your completed plan entered in your software, can you easily explain your plan in actual figures to a prospective lender, financial advisor, or— possibly the most difficult person to convince— your spouse?
These are just a few of the main questions you should ask to determine whether a particular farm software solution can help you with a major financial decision. If the answer is no, then it’s time to look at other options.
AgManager is an ag-specific financial software solution created specifically for agriculture businesses and designed to be fully customizable, allowing owners to effectively manage farm finances. Request a demo today to learn how AgManager can help your operation.