7 Farm Records That Show Whether You Are Making a Profit

A large harvest does not always mean a profitable farm. To know whether your crop or livestock business is truly making money, track every cost, every sale and the quantity you produce each season. Keep records of your total production cost, cost per unit, total output and total sales revenue. Include expenses such as seeds, fertiliser, feed, labour, chemicals, transport, fuel, packaging, medication and land preparation. Knowing your cost per kilogram, bag, crate or animal helps you avoid selling below cost. Also calculate gross profit, net profit and return on investment. Gross profit shows what remains after direct production costs, while net profit shows what you keep after all business expenses, including storage, marketing, loan interest and administration. ROI helps you compare which farming activity uses your money most effectively. Create a simple notebook or spreadsheet and update it regularly. At the end of each production cycle, use the figures to decide what to expand, reduce or improve. Profitable farmers do not only count harvests; they count the money behind every harvest.

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