Farmers Guardian Diversification Special 22nd April 2022

DIVERSIFICATION

SPECIAL

Edited by Alex Black alex.black@agriconnect.com 07880 490 486

PICTURE: GETTY

This eight-page special takes a look at how farmers can tap into the latest tourism trends, funding for new business ventures and opportunities in environmental projects.

24 TRENDS

Top tips on entering the tourism market

26 CAMPING

Opportunities in wild camping trend

28 FUNDING

What to consider before starting to diversify

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DIVERSIFICATION With agritourism a growing market even before the Covid-19 pandemic began, Savills’ Adam Davies gives his top tips for farmers looking to test the market.

Top 10 ways to enter into the tourism market

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rom wellness in the wilderness to weddings, innovative farmers and landowners across the country have been finding ways to tap into the demand for UK-based holidays, experiences and events.

Wide range Adam Davies, associate director in Savills’ tourism, leisure and events team said there was a wide range of ways to tap into the market, from adding value to what was already done on-farm to converting redundant buildings into venues, shops, cafes or accommodation.

“The key to success is doing something you are passionate about and have the time and resources to do well in conjunction with your normal farming requirements,” he said.

Ideas He added ideas needed to be well thought out and businesses need to consider market demand, competitors and the skills and passion of the people involved, as well as financial requirements, health and safety, insurance and sales and marketing.

Mr Davies gives his top tips on ways to enter the market.

The key to success is doing something you are passionate about, says Adam Davies.

ADAM DAVIES’ TOP TIPS

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Campsites: Safe drinking water must be supplied and we recommend providing a decent toilet block. Farms can list their campsites on online booking sites which take a commission.

Dog walking: Fence off a field – a 1.8-metre-high fence is often required by users — provide allweather parking and a website for online bookings. Charges range from £5-15/hour. Farmers will need change of use planning permission but, as no permanent development is taking place, most planners are in favour.

Public liability insurance is essential but inexpensive.

Farm vending machines: These have no location costs, little staffing requirements and can operate 24 hours a day. This can be a good way to test the market before opening a full-blown farm shop.

Farm tours and workshops: These are growing in popularity, with a real desire from the general public to find out more about where their food comes from and experience what life on the farm is like. A risk assessment will be required as well as notifying insurers. Hand washing facilities and toilet provision should be supplied.

E-bike hire: Users have to be 14 to go on public roads, but this

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does not apply off-road. Further income could be generated from helmet, pannier and lock hire.

Owners will need storage space, a workshop and will need to ask for a returnable deposit.

Ice cream: Ideal for dairy farmers in key tourist and coastal areas. Keep an eye on the weather forecast to gauge demand and market the product on social media. Food hygiene training is essential.

Co-working spaces: Former farm buildings converted into shared working spaces will require planning permission.

Micro-weddings: Intimate venues and ‘Instagramable’ backdrops are in vogue. Aside from the cost of converting and kitting out barns and outbuildings, in England and Wales a licence for civil ceremonies will be needed at an approximate cost of £1,800.

Selfies: This is a niche market but if films or TV shows have been shot in iconic locations, some landowners are charging people to come and take social media photos.

Branded camping: Some landowners are going into partnership with glamping franchises which will help establish and market the site in exchange for a percentage of the takings.

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DIVERSIFICATION As the British public search for something different from traditional camping and caravanning, Alex Black looks at how farmers can tap into the demand for sites.

Campers search for wild experiences

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nterest in wild camping has increased rapidly as people look to explore new areas of the UK and enjoy open spaces.

Wild camping is prohibited in England, Wales and Northern Ireland, while camping is permitted on most unenclosed land in Scotland.

But landowners may be able to cash in on the popularity of campervans and motorhomes by offering nights in locations outside of the usual camping and caravanning sites.

Wild With Consent, which connects motorhome owners with

landowners who have private, off the beaten track sites for off-grid and wild camping, launched last summer in Northumberland and is now looking to expand its offering beyond the county borders.

Guidance The company works with landowners to find sites which fit into its ethos and provides guidance on a pricing point.

Jas Moore farms 344 hectares in West Learmouth, Northumberland. The farm has traditionally been run as a mixed farm with permanent grass, an arable rota-

tion and 24ha of potatoes. Last year, the farm went organic.

Ms Moore said it seems a good small-scale diversification with no infrastructure costs.

“Our only concern was accessibility,” she said.

Guests book directly through Wild With Consent and pay through the website, which then sends the landowner the booking fee net of its 20 per cent commission.

Once a booking is made, the landowner will be sent all the details including the vehicle registration. Guests are then able to communicate directly with the landowner through the messaging system on the website, allowing landowners to make arrangements direct as needed.

Current planning permission exemptions allow landowners to take 28 bookings per year. However, once Wild With Consent has received its exempt organisation certification later this year, its new membership structure will enable landowners to take 60 bookings per year.

Ms Moore said their experience had been very positive and had found campers to be ‘genuinely

Landowners may be able to cash in on the popularity of wild camping.

interested’ in what was happening on-farm.

“I tell them about good walks and where they are most likely to see wildlife. It is gratifying when they see something unexpected.

“Our site is beside a small burn in a lush valley recently planted with trees. We have laid down some hardcore because campervans do not always travel well on wet grass.”

The current planning exemptions allow landowners to take a maximum of three campervans per holding, however their curated sites are isolated and only available to one campervan per night.

This exclusivity means a higher price point and allows landowners to make use of smaller potential pitches. Visitor charges are £25 for a standard site and up to £75 for a super premium site, per night per campervan.

Code of conduct

I had expected to pick up the odd piece of rubbish from time to time, but I have found that those wanting to get off the beaten track are very respectful of their surroundings JAS MOORE 26 | APRIL 22 2022

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Visitors are expected to follow a code of conduct with a two-way review system allowing campers to review sites and landowners to review campers.

Campers are expected to leave no trace and remove anything they bring onto the site with them. All rubbish is to be removed by the customer, they are expected to leave the site as they found it and to respect the wildlife, natural environment and heritage.

They are told not to light fires unless they are given explicit permission from the host and to use the toilet in the campervan or motorhome.

And Ms Moore said none of the campers they had hosted so far have left any trace.

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Site requirements

“I had expected to pick up the odd piece of rubbish from time to time, but I have found that those wanting to get off the beaten track are very respectful of their surroundings,” she said.

Ms Moore added she would definitely recommend hosting wild overnight campervanning to others.

“Not only has it been a great way to earn extra income with very

little effort, but seeing our farm through the eyes of customers enthused by their camping experience makes me realise just how lucky I am to live here,” she said.

■ A flat area of ground which is suitable for a non-4WD vehicle ■ Good access track also suitable for non-4WD vehicles as some campervans and motorhomes have relatively low clearance ■ Preferably access to be controlled with a coded lock on a gate ■ The area must be fenced off if livestock are in the same field ■ The visitor has exclusive access to the site from 1pm to 12 noon the next day

Land required for large scale solar farms throughout the UK Below are some requirements we initially look for when assessing a potential site: • • • •

100+ acres of low grade grazing land Flat or gentle sloping land An electrical grid line or substation onsite or nearby Not situated in any designated areas such as AONB, SSSI or National Park • Screened from residential properties We offer a competitive rent per acre for a 35-50 year lease period For all enquiries, please contact our UK Land Manager, Jono Wells, on 07470 047408 or email j.wells@voltalia.com web www.voltalia.com

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DIVERSIFICATION

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tilising existing assets to create new revenue streams can help farmers reduce risk and overcome uncertainty.

Jo Lampkowski, regional agriculture manager for the Agricultural Mortgage Corporation (AMC) in the north of England, looks at what farmers need to consider before going down the diversification rabbit hole and what information they need to prepare and prioritise to secure any funding needed.

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Get good market knowledge It is essential to do as much research as possible. For traditional farmers considering a move into non-farming activities it is important to reflect on how much is known about the market. Consider the level of demand, competition and outline what the business can do to differentiate itself. Also consider any new means of distribution and where the new product or service will be sold.

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Sufficiently prepare the current farming business and premises Weigh up whether the new enterprise will enhance or support the existing business and how this could be maximised and consider any negative

With increasing numbers looking to diversify, Jo Lampkowski, of AMC bank, shares her tips for those looking to secure funding.

Securing farm funding impact on current trading and how this would be managed.

This includes whether the existing business will service borrowing for the new enterprise and whether the existing premises is adequate.

tion. When exploring a new enterprise, it is important to assess its environmental impact and, if this is beneficial, how this can be maximised and promoted to help develop the business.

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Put people first It is important to carefully assess the impact on existing staff and whether they have the capacity and skills required. A lack of expertise or inadequate competences to run the new business can lead to failure, so consider if there is a need to hire new people, develop existing talent or whether it may be better to outsource.

If new staff are required, farmers will need to consider recruitment and the owner may need to divert their attention away from the core business to focus on the new enterprise.

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Set sights on sustainability Sustainability is a vital considera-

Take professional guidance Seeking out sound business and funding guidance to help the diversification venture is vital. Farmers should speak to professional advisers who can offer guidance, sources of finance and advice on how to effectively manage the transition to the new enterprise.

Careful planning is essential and can help mitigate risk.

Seeking out sound funding guidance to help the diversification venture is vital.

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Prepare a thorough business plan This should include set up costs, cashflow projections and budgets, financial accounts of the existing business and confirmation of any requirements such as planning permission or licences.

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arm diversification including renewable energy is a growing area of interest for Pegasus Group. Traditionally involving the change of use for land or buildings, planning permission for all kinds of renewable energy schemes including solar, wind and battery storage, is on the increase.

(NFU) which said it would help to deliver viable and profitable farming to the area.

Livestock will continue to graze the land around and under the solar panels and although crops will not be grown on the land while the solar park is operational, they will in the future. The extended fallow period is likely to be of benefit to the soil quality and improve biodiversity on site. Such projects can be sensitively sited in the countryside and need not have unacceptable environmental impacts.

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The approved scheme manages hedgerows and field margins to provide a net gain in biodiversity and wildlife habitat and was actively supported by the National Farmers Union 28 | APRIL 22 2022

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For advice on any schemes you may be considering, please contact us Pegasus Group | www.pegasusgroup.co.uk FGinsight.com

20/04/2022 10:36

The habitat will need some sort of management through livestock grazing, says Prof David Hill.

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Developers look to offset biodiversity

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equirements for developers to deliver a minimum of a 10 per cent uplift in biodiversity value could open new income streams for landowners.

In many cases, delivering the uplift off-site will make more sense for developers investing in habitat banks rather than trying to include it on housing sites.

Prof David Hill, chair of The Environment Bank, said biodiversity was more valuable to the environment off-site, where it was less interrupted by the people on the development.

Investing Landowners can bring forward their own land to developers, but Prof Hill said the process was complicated which could be offputting.

Prof Hill said they were investing in habitat banks, locking down land and providing a guaranteed income for landowners for 30 years and taking the risk out of the project for farmers.

Under the scheme, The Environment Bank leases parcels of land, typically between 10 and 100 hectares, which landowners create a biodiverse habitat on.

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biodiversity ‘credits’, which can be purchased by developers to meet the requirements of their site.

This is usually marginal or low yielding land, which could then be turned into wildflower meadows, woodland or wetlands.

Prof Hill added it could also be integrated into the farming enterprise.

Management “Most of the habitat will need some sort of management through livestock grazing,” he said.

He said they had landed on a 30-year lease as a compromise as companies investing in biodiversity would want long-term contracts, but farmers would struggle to commit for longer. Farmers could put the land forward again in year 31.

Prof Hill said payments varied dependent on the land used, but could be between £1,235-£2,471/ha per year.

He added farmers and landowners were the key to the recovery in biodiversity, but it could only be achieved through significant private investment.

“There is a big opportunity for landowners to play their part while generating an income,” he said.

David Holdcroft, Houndings Lane Farm, Sandbach

If you have land on the edge of a town or village you should talk to us. Muller is a family run business who understands farmers. Colin tells it as it is and gives you clear advice on the prospects of getting planning permission on your land.

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APRIL 22 2022 | 29

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DIVERSIFICATION With succession planning on many minds, farmer Leonie McIntosh talks about ensuring business sustainability for the next generation.

Building for the future

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aximising every opportunity their land and location has to offer was a key driver for the family-run partnership, B.J. Arkell, at Great Farm in Fairford, Gloucestershire, as they look to hand the farm onto the next generation on a strong financial footing.

The 1,012-hectare farm on the border of Oxfordshire, Gloucestershire and Wiltshire, is mostly arable with two beef enterprises. The family also runs a continuous programme of soil and habitat improvement.

The partnership has developed various new enterprises ranging from commercial and residential lets, a wedding venue, a glamping business and a seasonal pop-up campsite. This has resulted in their revenue now being split 50/50 between traditional farming and holiday and event income.

Leonie McIntosh, of Great Farm, said they always tried to stay ahead of

the curve, seeing increased demand for local food and tourism opportunities.

“We are continually looking at how we can do things better and what better things we can do,” she said.

The farm has transformed its Cotswold stone ‘Jenners Barn’ into a wedding and party venue, with an adjacent contemporary marquee, set in 2ha of water meadow. Guests can also hire the cottages and camp around the barn.

Camps Glamping has become ever more popular, especially after the pandemic and Great Farm has six different camps, from a shepherd hut to an upturned boat. Keeping up with trends is important in any business, and they have provided hot tubs for some camps.

Great Farm is situated on the edge of RAF Fairford, a US Airforce Base, which has provided another business opportunity. The Royal International Air Tattoo takes place annually in July,

the world’s largest military air show, attracting 150,000 spectators over the weekend. The family grasped the chance to set up a pop-up camping site.

Succession planning was an important consideration, both in commercial terms and on the environment.

Bruce Arkell, a partner in Great Farm, is a keen environmentalist and devoted a large part of his working life to planting trees and woodlands.

They have completed a carbon audit and try to ‘tread lightly’ on the land.

Ms McIntosh said: “I believe that for farms to thrive in the future, it is key to look at the changing schemes for more environmentally-focused farm payments as an opportunity not just a problem.”

Grants alone were not sufficient to fund all their enterprises and the farm has sought funding from Virgin Money to enable growth. They recently sought £2.8 million to purchase 81ha of neighbouring farmland and £2.14m

Bruce Arkell (left) with Leonie McIntosh, of Great Farm.

to purchase a farmhouse for accommodation for the wedding venue and enable them to free up their current property for letting via Airbnb.

The family said external investors had played an important role, with Justin Hayward, Virgin Money agribusiness relationship manager, providing them with finance which helped ensure future generations would benefit from the family’s business acumen.

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