AGRICULTURE SOFTWARE, WHAT IS IT FOR?

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Management software for business activities are now used in all sectors and are increasingly user-friendly. Thanks to the digital transformation of which they are the spokesperson, farm management software increases productivity in a sustainable way, it enhances and diversifies production planning and finance management. Let’s see together what agricultural software is used for and how it can help the agritech sector.

MANAGEMENT CONTROL FOR SMALL ENTERPRISES

One of the aspects that most interests the entrepreneurs in the agricultural sector is to verify profitability and always try to improve it. So how can you effectively control the technical and administrative management of your company? Certainly, thanks to a well-planned analytical accounting, that enables to evaluate profits.

In Italy, there are many small farms and they should equip themselves with effective internal management control to verify their profitability, by budgeting and the analysis of deviations.

Budget control

To make a prediction of the economic results it is necessary to be able to predict the revenues, costs, events capable of influencing them and the probability of their occurrence. Moreover, it is also necessary to evaluate the possibility of absorption of the final product in the market. Here’s how to do it:

  • Revenues - Predict the yield of the crop, the quantity of product required by the market and price trends. These factors can be influenced by different events, but the farmer must be able to understand both their effects and the probability of their occurrence;
  • Costs - To calculate the variable costs directly linked to production and structural costs, it is necessary to divide them among the activities. The ability of the agricultural entrepreneur to build the budget improves with experience, while a new entrepreneur can only rely on information collected externally and analyse historical trends.

Furthermore, the budget should foresee continuous future improvements for business efficiency.

Deviations analysis

After analysing costs and revenues, management control is also exercised by analysing the deviations between budget forecasts and final data. Entrepreneurs must be able to understand the reasons for a certain result and the adequacy of the budget assumptions; therefore, they must explain why a result is lower than expected due to unpredictable events. If it is necessary, they must intervene on time, by eliminating the factors that negatively affected the performance.

It is also true that a better balance of the budget is a positive fact if it was obtained thanks to exceptional and unrepeatable events, but it can mask structural inefficiencies. In this case, it is necessary to analyse it, taking into account the extraordinary events that influenced it, to understand the real profitability of the business.

Monitoring your business to understand its profitability is a requirement for all businesses, even for smaller ones. In fact, the inevitable management control can be carried out in a simple, but still effective way, by drafting the budget and analysing the deviations.

WHAT THE AGRICULTURAL SOFTWARE DO

In particular, agricultural software allows you to:

  • Accurately and easily manage data, reducing costs;
  • Analyse all the data available through periodic reports;
  • Simplify and protect access to data thanks to cloud servers;
  • Support to corporate accounting, warehouse management and much more;
  • Interact with all the devices in the field, providing the operator with precise information both in the farmland and in the office.

Among the most important functions of the agricultural ERP software there are:

  • Forecast weather monitoring and historical data per crop unit;
  • The pests detection and potential incoming diseases;
  • Registration of product collections;
  • Management and printing of the “Quaderno di campagna”, the farmland notebook;
  • The management of the workforce, machines and workers employed;
  • Management of the traceability of lots.

BUSINESS ACTIVITIES MANAGEMENT

The management of the farm and field activities, and correct agronomic and economic management, determine the sustainability of the farm both from the economic and environmental point of view. The recent paradigm in farm management involves:

  • A lower environmental impact;
  • A change in distribution systems;
  • A greater commitment to product quality and cultivation conditions.

Good company management reduces costs and fulfils the various regulations applied to agricultural production, while maintaining high quality and food safety standards for the product. Public administration and consumers have also influenced the agricultural sector by asking for greater quality and sustainability. In addition, the average size of European agricultural enterprises is growing, leading a greater competition.

Technological solutions for agriculture

FAO also talks about the management of agricultural businesses. The control activities allow the identification of weaknesses and more opportunities for the company, while the diagnosis and the solution of any weaknesses within the company are necessary to recognise the technical limits of productivity and business efficiency.

This “diagnosis” phase allows operational improvements and technological transformations. Medium-sized or large farms have difficulty keeping track of information relating to individual cultivation operations, so a searchable storage helps the planning and management of the farm.

By a software for agriculture, companies with many employees in the field and many hectares to manage, can easily keep track of the operations carried out. The agricultural software solutions on the market can transform the agricultural sector thanks to the introduction of high-tech and software and hardware able to solve the main problems of farmers.

A software for the technical and economic management of the farm, for example, can record the interventions and keep the cultivation activities under control, thus simplifying the administrative management of the farm. The reports produced then allow to monitor the profitability of the crops.

CHANGES IN FARMS

The management methods of the farm have changed for 3 reasons: technical progress, the greater dependence between farm and consumer and growing risks. The technical innovations then caused substantial changes of various kinds:

  • Changes in the structure of companies, with consequences for the reduction of the number of companies, increase of the UAA per company, of turnover and capitalisation;
  • Changes in production specialisation, with a reduction in the activities included in the production plan;
  • Changes in geographical location, with the formation of food chains and districts in which they create systems with high added value, for example in Parma, San Daniele, Parmigiano Reggiano, Grana and other territorial areas with typical products.

The change in the corporate organisation is linked to the spread of companies and vertical production processes or multilevel companies, which entail changes in the management of the company. With the spread of digital, the strategic objective of management has moved from production to the market.

Another management change is caused by technical risk, that means a limited control of the technologies used in the company, either due to lack of competence or external events that cannot be controlled. This problem can be solved with greater consumer transparency and food safety.

Climate events, market and financial uncertainties are among the causes of risk. Climate risk is increasing, market liberalization processes turn the market prices changing due to the growing demand. Moreover, there are other factors unrelated to agriculture, such as the price of crude oil, exchange rates, inflationary processes and the volatility of the futures markets. They require forecasts of risk effects on operating results.

Structural changes of farms

The latest structural changes in the agricultural sector confirm the differences between small businesses and medium-large businesses that want to improve their economic and organizational efficiency. The large dimensions, on the other hand, are able to introduce innovations faster, even using information as better as possible. They plan and control accounting, budgeting, results achieved, cost analysis, investment productivity and much more. Thanks to the internet, it is possible to manage online company data, exchange outsourced external services and develop in harmony with the internal and external environment of the company.

Farms in the North

In Italy the enterprises are widespread mainly in the northern area, with 4 homogeneous groups of provinces at different levels of industrialization:

  • Provinces with the presence of large companies that followed the agri-food transformation process, increasing business consultancy services and interfacing with research structures and public organisations to enjoy specific incentives. These companies collaborate with similar companies to improve transversal skills. These are innovative and competitive groups, which build networks, exchange services and experiences and develop alliances to create business projects based on knowledge and innovation. The regions concerned are Piedmont, Lombardy, Emilia, Trentino and Alto Adige and Veneto.
  • Provinces with the presence of companies that implement the diversification and implementation of low environmental impact cultivation systems in the areas of Tyrrhenian and the Mediterranean Seas;
  • Provinces with the presence of companies that have adopted traditional methods of management;
  • Provinces with subsistence companies destined to close down in the short term.

Business administration and management

The production and evaluation of the results are the responsibility of the company administration and of the agricultural valuations. The administration provides methodologies for the evaluation of economic results through the management, detection and organisation process:

  • Management is the set of programmed business decisions, directed and aimed at achieving the goal of the company itself;
  • The accounting record deals with the techniques for ordering and interpreting the company's administrative facts;
  • The company organisation deals with material, intangible and human resources.

SOFTWARE AND PRECISION AGRICULTURE

Precision agriculture includes applications that enables to increase the yield and quality of agricultural production by using fewer inputs, reducing expenditure items and increasing competitiveness and environmental sustainability. This allows the purchase of agricultural machines, automatic guidance systems, production mapping, variable dosage systems and related software.

Precision technologies allow you to work faster and more efficiently, in support of sustainability that also has positive effects on product traceability.

Precision agriculture, made of sensors, drones, blockchains and many others, is called the 4.0 agriculture revolution. It uses systems capable of detecting various parameters of field production, for example those installed on combine harvesters. Most of the systems that operate in the field of crop analysis and monitoring are certainly composed of drones. Thanks to this technology it is possible to obtain all the data in the field necessary for the management of the soil and plants, to safeguard their health and increase their yield.

If you are looking for a reliable supplier or a authoritative partner for projects, HT Apps could be the solution for you.

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