The key to successful diversification is to prevent new enterprises becoming a dangerous distraction to the core farming business, a group of young entrepreneurs heard on Tuesday (4 March).
Speaking at a packed event for young entrepreneurial people in farming, held at the Royal Agricultural College, Cirencester, rural consultant James Miles-Hobbs said successful business people were highly skilled at managing their time.
“Successful diversification means diversification, not distraction. This can, at worst, seriously undermine the existing business.”
And before embarking on a separate diversified enterprise, farmers should consider whether they possessed the right attributes themselves or whether they needed to employ others with different skills.
“You must like people more than cows. Perhaps the older generation in farming sometimes prefer cows – at least they offer routine, don’t change the rules and don’t argue about the bill.
“You have to understand and know your customers, and it’s about managing these people to get the most out of them.”
For example, a well-designed farm visitor attraction would include opportunities to increase visitors’ “dwell time” – places where they will increase the amount of time spent overall and their total spend.
“Successful entrepreneurs need to be completely market-focussed. It’s very difficult to group people together and understand how they work. But there are some simple things you can do.
“For example, the top elements of successful farm visitor attractions are opportunities for people to view animals, interact with them, and learn through play or entertainment.”
And farmers, who had long been price takers, should avoid the trap of selling too cheap, he added. “Traditionally, the dairy farmer has had limited negotiating power in signing a new milk contract, and certainly had no involvement with the consumer that buys the milk, but successful diversified businesses can change that.”
View the Future’s in Your Hands picture gallery on FWiSpace.