When people talk about how much they love being in agriculture, they’re rarely referring to the financial management part of the business. Manually keying in equipment or input costs into a system like QuickBooks, and then tracking payroll on top of that, can feel like a time-suck. So Traction Ag, an integrated web application that offers farm-specific accounting, may help get you out of the financial weeds of this otherwise grueling process.
“We’re unique in having the first web application that’s actually an accounting application, so it’s providing a balance sheet and profit/loss, accessible from any device and integrated into your operations,” said Traction CEO Ian Harley, who was showcasing the platform at the 2023 National Farm Machinery Show.
While agronomy and other production factors are certainly important to an operation’s success, if growers aren’t managing the farm’s finances appropriately, they’re missing out on making the best decisions for the road ahead — be it things like cash decisions for sharecrops, cash-land rent, equipment purchasing decisions, or when to expand. Sound financial management can also play a major role in ensuring in the best line of credit and the best rates if farmers can show the bank their market balance sheet and demonstrate that accounting is being done effectively.
Indiana-based Traction aims to save growers time and make all of this financial management easier. The cloud-based platform is connected with a grower’s bank and uses actual accounting transactional data. And because it can also connect directly to companies like John Deere and Climate Corp., Traction functions as a digital aggregator for all of a farm’s financial data.
And it sure beats having to key in input costs or equipment costs in order to obtain a farm-financial analysis.
“We help you get to two key performance indicators: the balance sheet which you’re looking to improve every year, especially with succession and planning, and then the other side, which is costs and margins and making sure your cost of production comes across,” said Harley, who spent a long time handling the books on his father’s farm. “That balance sheet and income statement, on a cash basis, become something you can use to prepare your Schedule F or a 1099 for your vendors. And all of that data is used to build your field profitability accounting data.”
Traction has grown significantly since its formation in 2020 and the launch of its first product in 2021. The company has 26 employees, including 12 in product engineering, and is projecting at least a 500 percent growth in its customer base by the end of the fiscal year.
Growers can purchase the platform through an annual subscription, which includes technology and service, such as certified public accountants on Traction’s staff. Harley said most growers gravitate to the high-end Pro Package, which is $3,800 per year, while payroll for up to five employees is a $750 add-on. Security measures, such as 2-factor authentication, are in place.
Harley said that there are tools in the software to give Traction Ag an idea of how growers are using the application and how much they’re accessing it, and if the company sees those drop off, its sales folks are proactively calling growers to help them through any sticking points.
“I say that Traction is designed for people who want to win the future,” Harley said. “It allows you to grow your farming business and puts you in good shape for passing on the farm to the next generation.”
Traction’s own future involves taking advantage of its partnership with CropZilla, as well as the acquisition of the Granular Business technology, which aids operations management. Granular Business will remain standalone tool for larger growers, but Traction hopes to bring some of that technology and expertise into their core financial software products.
“In addition to financial management,” Harley said, “the hope is that we’re giving you some of your time back, your evenings back or your weekends back.”
