Farmers urged to remember their ‘three Rs’ – research, research, research – to make money from diversification.
Farmers should resist the temptation to pursue what seem like ‘quick-win’ diversifications without thoroughly researching them, says rural surveyor and founder of The Business Barn, Hannah Moule.
“There is a lot of scope to make money through diversification, but tread carefully,” warns Ms Moule, who this week (January 26) launched The Business Barn, a free-to-access website helping rural entrepreneurs launch a start-up or grow a fledgling business.
“With subsidies set to fall, ever-more farmers will be on the hunt for new income streams, but the potential risks, as well as the benefits, must be intimately understood before committing to them.”
Latest figures from DEFRA’s Farm Business Survey show 64% of farms in England have diversified into a non-agricultural activity, taking total income from such sources to 29% of the amount generated from all farming activity.
“This area clearly has huge potential, but your starting point should be to examine your core enterprises to see if you can increase revenue or reduce cost. Only once you’ve done that, should you consider diversifying.”
Ms Moule, who has a passion for working with young and spinoff companies, adds: “The smart approach is to start small with a venture that doesn’t take a lot of capital or so much of your time that you take your eye off the ball as regards your farming endeavours.
“Don’t try to reinvent the wheel, either – there’s no better way to lower risk than by looking at others who already do something similar to your proposal.
“Farmers have always been fantastic at learning from their peers – years ago this meant going on farm walks and attending discussion groups, but now much of this research can be done online. Make the internet your new best friend.
“There’s lots of fantastic information already on the internet about farming, but rural start-up and small businesses have a very particular set of needs.
“In property circles, people use the expression ‘location, location, location’. With diversification, the mantra should be ‘research, research, research’. It really is a case of focusing on the three Rs.
“According to the government, there are 537,000 rural businesses in England, employing 3.5 million people. However, there is currently no central platform for such entrepreneurs so we conceived The Business Barn to satisfy this thirst for information.”
It features a comprehensive advice library, including guides, templates, articles, case studies and a directory listing professional organisations able to help small rural entrepreneurs.
“It’s not designed to replace professional advice, but provide inspiration, advice, guidance and support to help early-stage businesses get off the ground.”
Explore The Business Barn at: www.thebusinessbarn.co.uk