How to do better napkin math
A framework for units and measures in agriculture
Welcome back! I am thrilled to bring you this month’s edition of Topsoil, a monthly newsletter with frameworks to help you make sense of agriculture, at just the right depth.
I can tell you one of the fastest ways to lose a sale.
When giving a demonstration of a new tool, if you start giving examples with unrealistic numbers, get ready for your potential customer to immediately call a flag on the play.
“That doesn’t sound right to me. That’s way too high.”
Walking it back with a “this is just for demonstration purposes” doesn’t always prevent the ensuing multi-minute detour or loss of credibility.
Whether in sales demos, marketing materials, or just good old fashioned back-of-the-envelope calculations, it is important to use realistic numbers and appropriate units of measurement.
Today, I’ll share tips and a cheat sheet with commonly used units in agriculture. We’ll walk through an example together so your napkin math can shine.
Let’s dig in!
What the heck is an acre anyway?
Agriculture has its fair share of specific terminology. A few of those special terms are units of measurement. It helps me to have a mental image of measurements so I can truly appreciate the scale of things. Here are a few of the basics:
An acre, originally the area that a pair of oxen could plow in a day, is roughly the size of an American football field (without the end zones). A hectare is about two-and-a-half times larger than an acre.
A bushel is a measure of volume – think of a large laundry basket. Grains like corn, soybeans, and wheat are measured by the bushel.
Other specialty crops like fruits, vegetables, and nuts are measured in many different units, like cartons, boxes, lugs, sacks, flats, bales, tons, and crates.
Typically a corn kernel is larger than a soybean is larger than a grain of wheat, which helps me remember relative seeding rates: corn is lower than soybeans is lower than wheat.
The right units for the job
Agriculture is highly localized. You have to know where you are operating geographically and any nuances specific to that area, crop, or farm. Farm sizes have changed over time too, which we looked at earlier this year in the US with the deep dive on the Farm Census.
Below are some helpful numbers – primarily for row crops in the US – for a production agriculture setting. If you work with farmers who grow other crops, are based in another country, or are using different practices, I encourage you to do research on the numbers that make sense for your context. As one example, many countries outside of the United States use the metric system.
Feel free to download this as a PDF using the link below.
These estimates are just that – estimates. This is certainly not agronomic advice. When the rubber meets the road in the real world, many other factors can influence each of these numbers.
If you are a person whose day job in agriculture primarily revolves around typing stuff into your computer at a desk (🙋🏻♀️), hopefully this cheat sheet can save you from some of the worst experiences of throwing a number out there and being met by tight, close-mouthed smiles and barely suppressed eye rolls.
What other calculations, measures, or rules of thumb do you rely on or find yourself googling? Let me know in the comments below.
Putting it to practice
Oftentimes, the only time a unit and conversion chart comes out to play is during a math test in school. Maybe you had a job interview where you were asked silly little brainteasers (like how many golf balls fit in a 747 jet, which you will need to know exactly zero times for anything you will actually encounter on the job).
Since working in agriculture, however, I have been impressed by the number of times people around me whip out back-of-the-envelope calculations. Whether it is to calculate a tank mix, to gut check a new business idea, or to plan out a field trial, there are many times that quickly crunching numbers is critical.
Let’s walk through an example to put our cheat sheet to practice.
Imagine you’re at a conference. You walk into an elevator. The fellow next to you begins pitching his new company to you. How quickly can you evaluate if there’s any merit to this dude’s business idea?
“We created a robot that can precisely fertilize each plant in a field, increasing corn yield by 22 bushels per acre in trials. The robot can fertilize over 1,000 plants a day!”
If you were new to bushels, acres, and yield, you may be thinking: “22 bushels – is that a lot? 1,000 plants certainly sounds like a lot!”
But, if you recall from your handy cheat sheet, 22 bushels is a little over a 10% bump in yield (assuming an average 200 bushel/acre yield for corn). At the current price of $4/bushel, this is almost $90 of additional revenue per acre for a farmer. Not bad. With our ROI calculation, we know that the total cost of this robot (including the time and effort to implement) would need to be less than this $90/acre to be ROI positive for the farmer.
However, we also know that in a typical acre of corn, roughly 32,000 seeds are planted. If a robot can fertilize 1,000 plants a day, it would take over a month to cover a single acre. This would mean that you would either need dozens of these robots running 24/7 (likely to cost much more than our $90/acre to be ROI positive), or this wouldn’t work for row crops with millions of plants on any given farm.
You can politely let our elevator pitchman down, or at least direct him to other cropping systems where something like this might have a better chance to generate a positive ROI for the farmer.
A few final rules of thumb
Beware of false precision
When you run a calculation where all of the inputs are SWAGs, and the answer comes out to $847.76 on the dot – beware of false precision! It is often best to round the final answer so you (and anyone you show those numbers to) know that the real answer is going to likely be “around $850” or “between $800 and $900.”
Keep track of your assumptions
My 6th grade teacher liked to say “never assume because that makes an A-S-S out of U and ME” (and yes he would spell it out which had the whole class in titters). While that is probably good advice for many parts of life, in business, you often have to make assumptions first and ask questions later.
The key is to keep track of those assumptions. And as you learn more, you can update those assumptions. This is the process of separating out the “knowns” and the “unknowns” and chasing down those “unknowns.”
Be prepared to be wrong
Finally, remember that napkin math can be embarrassingly, expensively wrong. If the decision you are making is important and not easy to undo, you might need to bring in some bigger guns. Perhaps dust off your excel sheet, get some experts to weigh in, and of course double check any assumptions.
The beauty of agriculture is that it takes place in the messy, chaotic, 3D-real world. There is always some level of uncertainty, noise, and risk. Even the best napkin math won’t get it right all the time. It’s worth remembering a quote from Dwight Eisenhower, “Farming looks mighty easy when your plow is a pencil and you're a thousand miles from the corn field.”
Thank you for reading! I’d love to know what formulas, conversions, or reference tables you have printed out or screenshotted on your phone in the comments below.
Topsoil is handcrafted just for you by Ariel Patton. Complete sources can be found here. All views expressed and any errors in this newsletter are my own.
How did you feel about this monthly edition of Topsoil? Click below to let me know!
So true!! I have a distinct memory of showing a yield estimation tool prototype to a farmer where in a last minute design edit, I'd changed the label of the y-axis to say "soybeans" but accidentally kept corn yield numbers in the chart. The user interview immediately derailed and turned into jokes about where I was getting 200 bu soybean yields. Wish I had this chart then!
This is such a good and useful article! A top notch top soil article :)