How to Create a Farm Equipment Inventory
Carefully sourcing items for purchase, reviewing bids, getting financing and insuring your farm’s belongings is a critical part of managing your farm or ranch. And since it’s taken so much to get your operation where it is today, it makes good business sense to build an inventory of your farm’s equipment, implements and assets.
Take a look at these tips and best practices for creating an accurate inventory for continued success on your farm or ranch.
The Price of Your Farm Equipment Inventory
Gathering your equipment information into one place can be a process — but the payoff is worth it. Not only will you have access to important details about each piece of equipment, you’ll also have a running list of makes and model numbers in the event that parts or service is required. And you’ll have everything you need when it’s time to get a fair market value price for your equipment.
And having an updated inventory on file can really pay off if you need to file an insurance claim, because you’ll have all the information right there to get the claim started. Take a look at the details on our farm and ranch coverage to be sure you’ve got the right insurance that fits your farm’s business needs.
Catalog Your Farm Implements and Farm Tools First
It’s time to get down to business and start pulling files. Begin by building a list of implements and equipment that are essential to your farm’s day to day operations. Here are some of the documents you’ll need.
Start with the high-value items and assets on your farm like the ones listed below:
- Farm irrigation systems
- Hay balers, backhoes, and wagons
- Cultivators and disks
- Herbicide and crop sprayers, as well as fertilizer and manure spreaders
- Milking machines
- Irrigation equipment
- Internal combustion and electric motors
- Water pumps and air compressors
- Motorized post-hole diggers
- Snow throwers and lawn mowers
- Generators and emergency backup equipment
Once you have the records out for the above items, dig in and locate the following:
- Original purchase orders
- Purchase receipts
- Tax receipts
- Liens or collateral documents that used the above items in order to get financing
- State and county registration records
- Insurance documents
- Financing documents
- Maintenance records
Leverage Farm Management Software
Powerful farm management software is available to quickly turn your farm equipment inventory and implement details into a web-enabled, mobile-friendly database that you can access and update from anywhere. All you'll need is a cell signal and the app downloaded to your mobile device.
More importantly, farm management software can make your farm easier to run and more profitable too. Many systems are able to manage your farm’s entire business, from employee payroll to tracking crop and livestock details, to accounts payable and receivable. They’re worth considering.
The Financial Benefits of a Farm Equipment Inventory
With your inventory complete, you’ll be able to rapidly gain insights into which equipment is approaching the end of its usable life, and which items are in need of replacement. With non-cash expenses like inventory depreciation tracked closely, you can make informed decisions on when to sell or purchase large implements and equipment.
Take Inventory of Your Farm Insurance
An accurate picture of your farm’s inventory can offer key insights from your farm's financial health to the fair market value of your assets like livestock and equipment. Another benefit of creating a farm inventory is that it also helps assess the value of the farm as a whole, when the time comes to evaluate your estate. Understanding the importance of a farm succession plan will help you to carry your family’s vision and future business intents to the next generation.
After you’ve completed your farm equipment inventory, get a copy of it to your American Family Insurance agent. With this information, you’ll be able to tune your insurance to best reflect today’s needs so that — no matter what tomorrow brings — you and your family’s investments will be protected.