Act on diversification ideas
IF YOU have a good idea for a diversification, act on it – don‘t hang around and watch someone else make a success of it.
That was the advice from Kent farmer Doug Wanstall at the Oxford Farming Conference who described the build-up of his business from a free-range egg franchise in 1997 to a £6m turnover farming, food processing and retail business.
Given the UK‘s high cost base, farmers had little option than to differentiate their products from commodities.
But the fact that consumers spend around £127bn a year on food and drink, while farmers only achieve added value of £6.5bn demonstrates the scope that exists to move further up the food chain.
Mr Wanstall had put this into effect initially by selling eggs direct on a retail round in London, but then seizing every opportunity to extend the range to a wide array of farm-produced foods.
The introduction of congestion charges for driving in London was the spur to another diversification – the creation of bio-diesel from customers‘ waste vegetable oil as a way of avoiding the charge.
The company has since set up two farm shops, developed a hamper business and built a ready-meals production facility.
Mr Wanstall said that farmers should not be scared of setting their own prices for added value produce. “Lowering one‘s price is not the only way to stimulate demand,” he said.
A similar approach was described by Hereford potato farmer William Chase.
He realised in the late 1990s that potatoes would not make a sustained profit, with too many growers in a shrinking market.
After two years looking for an alternative he came up with the idea of US-style hand-fried crisps.
To research the project he travelled to Spain, Canada and America. “Gathering advice from others in the UK is a closed shop.”
One of the keys to success, Mr Chase told the conference, was getting the right people and learning to delegate rather than trying to do everything oneself.
Product innovation was also essential, with the recent launch of Apple Chips a good example of how his company, Tyrrells, was trying to keep ahead.
Having an open mind to opportunities was also central to the diversification of Janaways in Hampshire, described to the conference by Angus Janaway.
Activities on the family‘s various farms ranged from a shooting school to car storage, and from quarrying to morphine production.
He also described how his farm was regularly used as a film set, and how he had developed a £60,000 business planting wild flowers and fencing small paddocks.
One of the greatest drivers was a realisation that subsidies were not going to last forever.
“Look at the new single farm payment as an opportunity. If you can‘t make any money growing wheat stop, pause for breath and see what‘s on the back of the new SFP.”