Farm diversification can seem like a daunting process for those new to trialling new projects, but many surveys show the huge benefits on offer for those who achieve successful farm diversification. Check out our blog on planning your farm marketing strategy here
Ingenuity, drive, skill and hard work are all clear to see in the results of Farmers Weekly’s diversification survey, carried out in association with Carter Jonas. A vast range of alternative ventures are run by the 250 people who completed the survey, with almost 100 different enterprises listed.
More than two-thirds (68%) have diversified, into areas ranging from the familiar and the popular such as commercial and residential developments, renewable energy and tourism, to a flying school, plumbing, dog training, quarrying and boatyards.
We have a full range of blogs on farm diversification planning. We cover diversification ideas for many farm types such as our dairy diversification blog, sheep farm diversification and pork farm diversification.
A huge 97% scored their alternative enterprise a success in profitability terms, with about half saying that it was profitable to a great extent and one-third seeing a profit in the first, second and third years of operation.
Eight in 10 believed it was an environmental success too.
More than half of those already diversifying plan to expand these interests in the next five years.
Areas that farmers find the most challenging are securing planning permission, funding, and correctly budgeting for a new enterprise.
Only one in five had any grant funding to help with the new venture.
Among those planning to diversify, most are looking at commercial lets such as workshops, offices and storage, alongside residential developments for tourism and the domestic rental market.
There is also a notable trend to bolt extra offerings on to existing diversifications – for example, farm shops and cafes are increasingly introducing function or meeting rooms, bringing them not only the hire income for the room, but also the chance to sell to or cater for those using the facilities.
Enterprises with an educational aspect were noticeable, both in existing and planned businesses.
This is usually strongly linked to a desire to educate both children and the wider public about farming and food production, as well as providing additional income.
One farmer is planning to have an Open Farm Sunday-type event every fortnight.
While some saw diversification as essential, helping them to stay in farming, others were critical of the fact they had felt forced to go down the alternative enterprise route when they would prefer that farming provided a decent income on its own.
Others warned of the potential effect on the farming business if too much management time or cash was diverted to the new venture.
It was important to be flexible, said one farmer, who had developed a wedding barn venue in an area that was now overrun with such offerings
“There was one when we did ours, now there are eight – take care and be flexible!”
High planning fees, including one example of £90,000 to convert a barn, came in for criticism too, alongside the complex and sometimes impenetrable grants offerings.
Most respondents said they would not change anything, but where they would, the most common comments centred on starting at a larger scale and starting the new enterprise earlier.
Others said they would have:
Survey respondents are running a huge range of alternative enterprises:
Article taken from Farming Weekly