More income from your farm? Diversification may hold the key
It’s been a tough winter for farmers across the region and Spring is proving challenging given the extreme weather conditions we’ve experienced. Although farmers can’t control such external factors, it does have quite an impact on their farm business – there will be less offspring to sell, potentially poorer crops and larger than usual feed and bedding bills. Consequently, the income of farms across the North will be affected, and it’s important farmers plan appropriately for this, to help sustain the farm.
Cashflow management is critical during testing times and one way to help ensure a consistent and reliable income is by providing alternative revenue streams, such as contract management. This doesn’t just apply to arable farms. We have seen a dramatic increase in the number of livestock contract management agreements being offered, notably the influx of pigs being brought in to Northumberland, as well as cattle rearing agreements, or something outside of the box; there are numerous ways contract management can benefit businesses. These are prime examples of how smaller scale farmers, with limited capital to diversify can achieve mixed farming practices and increase their farming enterprises, or even larger farmers looking at expanding once again.
Diversification also presents a huge opportunity to farmers to increase their cash generation from alternative revenue streams. This could be due to the older generation looking to retire from the farm business and aren’t able to as they rely on the farm’s income. This can put a large burden on the business and its cash availability. There are numerous ways farmers can diversify to, again, spread their enterprises and income streams to compensate for this, whether it be other agricultural enterprises, tourism or a non-farming option. It can all contribute to the greater goal of farm sustainability and cash availability throughout the year.
The same can be said for the younger generation when sons and daughters return home and are looking to be involved in the business. An alternative enterprise or diversification can be the answer. This can then help them to build up something for themselves, and give them a form of responsibility which so many desire.
George F. White works with farmers across the region, advising and supporting them through many different types of income alternatives, whether this be contract farming/management options or diversification projects; including tourism, energy efficiency and farm productivity. We are experienced in guiding farmers through each step of the process, managing the different aspects involved in setting up a new enterprise, including grant support where available. We also provide support in planning applications or cashflow management, if required. Whichever way you’d like to diversify, we’re here to advise and support you on and through the establishment of an alternative revenue stream that will sustain and support the main farm business.