Resilience and adaptability have always been a part of farming in Scotland, and with massive economic and political change on the horizon, those skills are enabling farms to find new income streams to make their businesses sustainable.
The extent of diversification on Scottish farms is revealed by research produced by NFU Mutual which has found that over 27% of Scotland’s farmers are planning to diversify in to other enterprises to support their farm business after Brexit.
So how can diversification help the future of the UK’s farms?
With declining direct support for many farms on the horizon, it’s essential to examine the opportunities available from diversified income streams. These will obviously be very varied, depending on factors such as location, access to customers, availability of redundant or adaptable buildings and probably most importantly, the interests, readiness and skills available within the family or the workforce.
With activities such as holiday lets, farm shops and function venues bringing people onto the farm, it is clear to see that robust insurance and risk management is a must. It needs careful planning to protect your customers and your business, whilst still offering the farm experience. Started by farmers, for farmers, in 1910, NFU Mutual has also diversified since it was founded. We now provide a diverse range of insurance covers to suit the demands of the ever changing landscape.
Research also found that from the 62% of UK farmers already diversified, 94% have been financially successful. Amongst Scotland’s farmers who do not currently run diversification enterprises, 27% said they would probably or definitely diversify in the future. However, just under half (45.5%) of non-diversified Scottish farms still believe farming provides the best potential for their holding. Other reasons for not planning to diversify included lack of access to finance, no interest amongst family members and poor broadband.
NFU Mutual’s Diversification Report published at the tail end of last year provides information on the latest trends, together with expert insight and analysis to help farmers make decisions on the future direction of their farm businesses after Brexit.
The report, together with a series of videos and podcasts produced to help farmers considering diversification decide how to proceed, are now available to download here: www.nfumutual.co.uk/farming/farming-diversification.
I hope this report will help people with their diversification journey and whichever direction they take, NFU Mutual is committed to providing first-class customer service that is personal, expert and accessible, every step of the way.
About the author:
Jim McLaren is a NFU Mutual Board Director and runs a mixed beef and arable farm. He was previously President of NFU Scotland and Chairman of Quality Meat Scotland.