Administrative efficiency could be producers’ saving grace

Estimated reading time: 4 minutes

“While the administrative back office is not the focus of a farming operation, it could be the difference between make or break during tough farming seasons such as the one currently experienced,” said Jaco Minnaar, president of Agri SA and former chairperson of Grain SA, during a Nation in Conversation session held at Nampo in Bothaville recently.

“While the back office is not a producer’s core function, it should serve as an enabler for his or her business to run smoother.”

The back office refers to the administrative support systems, including finances, logistics, supply chain management, regulatory compliance, occupational health and safety matters and data analysis. These systems should enable farming operations to run smoothly.

Minnaar, a former Free State Young Farmer of the Year, said his family’s office benefited greatly from his father’s foresight to invest in technology in 1998. Ultimately, a well-functioning office contributes to control, effective business management and the gathering of intelligence. “The back office is not a producer’s core responsibility; it remains a vital enabler for a successful farming business.”

Read about the change in agriculture here.

Tailored solutions

JP Meintjes, a fourth-generation producer from Viljoenskroon, recognised the significance of the back office when he began farming in 2000. He noticed a gap between agricultural information and financial data.

Although finding the right system wasn’t straightforward, Meintjes eventually discovered a system that suited his farm.

AC van Wyk, a former Grain SA Grain Farmer of the Year, echoed Meintjes’ sentiments. Van Wyk emphasised that each farming operation has unique needs, making it essential for producers to assess their requirements. “Some producers may need to free up time, while others might have available time, but lack expertise in specific aspects of their business. Based on this you might determine which skills to employ or which areas to focus on for professional development,” Van Wyk said.

“But always keep in mind that your income is mainly generated in the field. Do not lose contact with the fundamental basis of your business. Everything you do in the back office should strengthen the fundamental business.”

Information is key

Francois de Kock, Senwes’ executive manager for Agri Credit Solutions, said just like any other business, proper financial control is critical for a farming operation’s success. “Senwes continually enhances its digital offerings through its mobile application, aiming to simplify tasks for producers. We do this to improve producers’ ability to manage inventory or grain deliveries, along with secure transaction PINs. “

De Kock added that producers needed to understand the legal risk that they faced if they neglected their back-office responsibilities. “These days most farming operations are run in the form of a trust or company and producers are usually trustees or directors of these companies. I am just not always certain that producers grasp the legal responsibility that rests on their shoulders as directors or trustees.”  

De Kock said to address this, he recommends arranging a meeting between the producer, their accountant and their legal representative. This ensures alignment and proper structuring of the farming operation, even beyond the producer’s tenure.

Technology’s role

According to Vikar Sheopershad, technical marketing planner at John Deere, the company prioritises simplifying the lives of producers. Therefore, they offer products and services such as JD Link and their operations centre.

Meintjes said producers needed to keep up with technological advancements. “A producer that does not implement modern technology that these machinery companies offer will be left behind. It will simply become an impossible task to try and catch up at a certain point.”

Minnaar echoed this sentiment, noting that the world loses half of its farming population every twenty years. “If you do not want to be one of those producers, you need to ensure that you surround yourself with proper information to make the best possible decisions.”

De Kock suggested that survival hinges on surrounding oneself with trusted advisors. “While these people need to be knowledgeable about their industry, they should also have an in-depth knowledge about your producer operation. Without this, they won’t be able to give you the correct advice.”

Furthermore, De Kock highlighted the value that social media platforms, such as WhatsApp could unlock. “Many producers have WhatsApp groups where they are the foreman, producer, tractor driver and back-office person on the same group. That way they can immediately communicate if there are any problems such as a diesel shortage. Through this system the back-office person can order new supplies early on and the inventory is kept up to date.”

Van Wyk said similarly Microsoft Excell was also a wonderful, relatively inexpensive program which could help producers organise every aspect of their farming operation. “There is no limit to the creativity and customisation that can be used in this program.” – Susan Marais, AgriOrbit

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