In response to peanut industry requests to improve the farmers stock grading system, an automated grading system was developed that reduced the variability in measuring most grade factors up to 50%. The automated system reduced sampling error by grading a larger sample while maintaining approximately the same sample processing speed. The system reduced inspector error by simplifying the grading process and eliminating opportunities for mistakes to occur. The system reduced equipment error by replacing outdated equipment with more efficient and effective equipment. Implementing the system could result in a return of about $10,350 annually per buying point and save the entire U.S. peanut industry up to $6 million each year. In addition, reducing errors in measuring grade factors should improve the quality of peanuts reaching consumers.