Becoming a diversified farmer in the UK requires a combination of traditional agricultural skills, business acumen, and a willingness to explore innovative approaches. Diversification involves expanding beyond conventional farming practices to include additional income streams and activities on the farm.
It is also a brilliant way to enable new entrants in to the farm business as it creates new opportunities. These may be family members but could also be outsiders to the business who have a wealth of business acumen which could be utilised.
There are so many things to consider when setting up a new venture, from deciding on the initial business structure, raising finance to running the business and managing it as it grows.
Before you take the plunge though here are some things that you may wish to consider when assessing the business feasibility?
What’s the market place? Who is likely to buy your goods or service? Speak to friends, family, use social media channels to run polls? Look at the competition and see how well they are doing? Have you got a product or service that people want. Sometimes a bit of entrepreneurial spirit may be required here as well as you may have something to offer that people don’t realise they want.
Will you need planning permission? It is likely that a business idea away from farming may require a change of use of land/buildings. Use a planning consultant for some free or low-cost initial advice. There is no point getting too far down the line only to realise that this is going to be a battle with locals/planners.
Who is the competition? Find out what you can about your competition. What are they doing well, what could they improve on. What are their Unique selling points and do you know if they are planning to expand. Look at planning portals to understand what planning permission they may have and use companies house to understand a little more about their company structure. How do they market themselves and find out any PR you can to learn more about them? Join their social media channels to keep abreast of any news.
Financial forecasting. Develop a trial profit and loss forecast and cash flow. Any business plan should include this and if you are planning on raising finance this will be critical. Always remember to put enough working capital into the model as it can often take longer to break even in a new business than you can imagine. Road test your financials with a competent person i.e. accountant or a friend with good experience as there is bound to be something you have missed out.
Key personnel. Who will be the key personnel running this business? Do they have the right skill set and time? Setting up a business takes a lot of energy and commitment and if the individuals setting up aren’t right or haven’t got the time then stop as that is what will matter day after day.
A very simple way of pulling things together and allowing yourself to stand back from the project is to run a SWOT – Strengths, Weaknesses of the business, Opportunities, Threats.
These are just some of the aspects to consider. Squab have been involved in all sorts of things over the years and if you ever want to discuss your opportunity then we would be more than happy to listen.
Get in touch: martin@squab.co.uk
