Harvesting Financial Data From The Farm

Say the words “cloud” and “farming,” and no doubt, your mind’s eye will bring forth torrential showers and waves of wheat.

Shift that a bit — picture Internet-based “cloud” computing and waves of financial data, all zeroes and ones.

To the oldest of professions — tilling the land — an increasing reliance on technology is allowing for both family and institutional farms to tackle the daunting logistics and rapid decision-making — across mobile devices used in the field — that translate eventually into good harvests or poor ones.

Earlier this month, Conservis, a cloud-based farm management software business, announced that it would be integrating accounting functions via FBS’ platform into its own software suite, which allows for data to be transferred into back-office functions.

The firm, which does business across the United States, Australia, Ukraine and Argentina, has maintained that it is the first farm management technology company to offer the full range of data flow, with visibility that stretches from budget planning all the way back to the accounting function to uncover the financial impact of all events.

In an interview with PYMNTS, Chris Benyo, chief revenue officer for Conservis, said that challenges in accounting functions for the agriculture industry include the fact that there are many moving parts. All too often, he said, farmers wind up “estimating change,” while there has also been a technological challenge that has only recently been addressed: “access to broadband has, in the past, been largely lacking in many rural areas,” though that has been changing. And, with access to broadband, there’s the ability to shift away from the traditional ways farmers have been doing their business management — by hand, for example, or through desktops or software packages.

With the movement into the cloud and Software-as-a-Service through companies such as Conservis, farmers are now able to gain significant and granular insight into the progress from planting to harvest. Advantages that tie in to the use of the software include finding a true profit and loss for the farmer as all manner of financial data are integrated.

By way of example, said the executive, a farmer can issue a purchase order for a pesticide, track its use and impact on a given field and allocate the costs to that field, with corresponding impact to profit and loss once the particular crop is harvested and then sold. This is, of course, a better and more efficient accounting methodology than allocating expenses on an average basis across a farm-wide P&L and gives a better view of just how different parts are contributing to the whole.

This is the first accounting module tied to its platforms that Conservis is making available to its growers — who raise commodities spanning wheat, corn, cotton, sorghum and a dozen other offerings — with others to follow, into perennial crops such as almonds, especially when Conservis expands into new areas that may include livestock and other products.

For now, according to Benyo, “the ability to provide a clear picture of what really happens in a field” gives a real understanding of how profits materialize over a cycle that, from planting to final harvest and shipment, “can take nine months.”

For the farmer, the additional benefits can translate into eventual expansion; as lender, as Benyo noted, many Conservis customers are “million dollar and multimillion dollar enterprises.” With a clearer snapshot of just how activities are bringing profits — and how, say, new equipment can help drive profits higher — lenders are more likely to put up funding to help drive new initiatives, whether it be a new combine or new land purchases.

Also, more stringent tracking of activity after a purchase order — which, Benyo stated, can amount to a “black hole” where inadvertent errors can occur — can make the difference between profit and loss, if, say, an 80,000-pound corn shipment is not accounted for in a timely and correct manner. Across a client base that spans 1.5 million acres of production, Conservis, said Benyo, and cloud software in general, “can give farmers back a couple of hours in a week,” with better workflow and decision-making ability.