What is it that sets the best farmers apart from the rest? Do they have to be owner-occupiers with double the acreage of anyone else? Or is diversification the key to success?
According to a new report by Rural Business Research, the group behind the Farm Business Survey, the most important factors behind successful farmers are controlling costs and paying attention to detail in everyday tasks.
The survey of the top performing and most improved farms over the past three to five years included 12 in-depth case studies across each sector of British farming.
These share some noticeable common factors:
- Farm size was generally larger than average
- There were more tenanted farm businesses than in the overall FBS sample
- Top performers also had high net worth and low borrowings
- Tight focus on cost control and gross margins
- Efficient purchase and use of inputs instead of focusing on yield at all costs
- Gross margins used as vital budgeting measures.
- Most had some formal training after leaving school
- Many sought outside advice but retained ultimate responsibility for decision-making.
Farmers in the sample had no greater or smaller reliance on the single payment, environmental payments or diversified income than the average business, said the report.
While some noted physical advantages of soil type or location, they had also seized opportunities to change and develop their businesses. But profit, while a key objective, was not the sole driver behind the business, with other considerations including family and lifestyle goals.
Another important element to the farmers’ success was benchmarking their business against others, and keeping up to date with industry developments through the media, co-operative groups and farm walks. “Do your job and do it well,” said one of the case study farmers.
“Attention to detail is vital in all aspects of the business including agronomy, marketing, general farm work, field operations, machinery maintenance and book-keeping. Keep your options open and don’t be adverse to change if needed to move the business forward.”
Key points to a successful business
- Control costs
- Pay attention to detail
- Be open and flexible to new opportunities
- Focus on gross margins
- Benchmark against others