How should I start thinking about future proofing my farming business?30/03/20
If you are planning to hand your farm on to the next generation, what steps should you be thinking about taking in the medium term, to increase its long-term economic viability as far as possible?
A good starting point may be to assess the business as it is and identify the greatest areas of risk and stress. For example, does the farm currently, in the normal course of events, rely on a single source of income? If so, how secure is this income stream normally? To what degree can you usually control the outputs and inputs and profitability? Sometimes, it helps to involve someone outside the business who can look at options with complete objectivity.
Someone should also fully appraise the property to gain an understanding of what potential the assets might have in terms of alternative uses. Options are often linked to locational factors, planning potential and, most importantly, the landowner’s aspirations.
Clearly, if the business planning involves members of the next generation, ideally they should be involved in the discussions around future proofing the business, and any diversification activities that might be appropriate.
Diversification ideas for farming
If farmers wish to maintain links with animal husbandry, then less traditional livestock rearing might be an appropriate way forward. ‘Exotic’ species, are becoming an increasingly common sight in our fields, capitalising on rising interest in alternative, high value, niche products such meat and wool, from ostriches and wild boar to alpacas and llamas.
In normal times, tourism continues to be a viable investment opportunity in many regions. As well as camping, ‘glamping’ and traditional Bed and Breakfast breaks, the growing interest in sustainability and finding out where food comes from means that ‘working’ holidays on farms have an increasing appeal for busy city dwellers. In this era of Airbnb and Trivago, quality farm building conversion into covetable self-catering accommodation can also be a good option.
Whether you are looking for diversification opportunities that can provide substantial additional income streams to your core business or if you are looking to change tack completely, experts will also be able to advise you on what would work best for you.
You should plan to seek professional advice to find out if diversification is right for you and your farm’s future. An expert will help you assess your existing business, advise what choices are available to you, make you aware of any associated rules and regulations and can also suggest what funding options you should look into.