Spring 2019 – Rural business and the economy

Future-proof your farm

The uncertainty over Brexit has had an unprecedented impact on the UK’s rural economy forcing many farmers to re-evaluate their business models.  Faced with uncertain futures from their traditional agricultural and livestock revenues, diversifying into unknown territory is often the only option. In fact, according to government figures, 62 per cent of UK farmers are having to diversify alongside running a traditional working farm.

The positive news is that all around the country successful diversified businesses are indeed thriving – offering farmers a much-needed lifeline outside their limited or declining farming income. The Farm Business Survey 2015/16 claimed the total income from diversification activities was £580m, demonstrating that generating alternative revenue from the land can be a lucrative move.

Change your business landscape

Amid economic uncertainty there will always be one certainty. People need entertaining.  More people spend their disposable income on ‘experiences’, dining out and holidays than ever before. By unearthing their entrepreneurial spirit and exploiting their local knowledge, farmers can jump on the bandwagon of this trend and give a new lease of life to their faltering business.

From kids petting and play parties, holiday lets, quad biking and organic cafes to woodland yoga and food festivals, diversifying into new recreational and tourism-related activities can safeguard business for future generations. With acres of land and out-buildings at their disposal, farms are not hindered by the barrier of a huge initial outlay for premises.

Don’t let your livelihood be vulnerable

It may take a leap of faith swapping mulching for music festivals and tilling for toddler parties but it could be the lifeline farmers need to buck the economic downturn trend.However, these new ventures inevitably come with new challenges and new risks. Critical gaps in knowledge and experience are inevitable during the tough transitional period.

Delving into the unknown can create substantial revenue returns but requires shrewd business planning along with judicious risk management, health and safety assessments and prudent insurance arrangements to protect against potential new liabilities.

Although adept at the challenges of running rural businesses, diversifying farmers can be vulnerable to unforeseen claims for uninsured risks and claims from members of the public visiting their reinvented and revamped farm premises. Lycetts has almost 60 years’ experience advising and insuring farming and diversified businesses. From risk management, HSE compliance and specialist insurance advice, we can help you identify and avoid costly and business-damaging downfalls.

Forewarned is forearmed – make diversification damage limitation a priority for your new venture.