If you’re considering diversifying your farm, then a cost-effective means of doing so can be to utilise any redundant or unused buildings on your farm and turn them into facilities for prosperous new avenues of business.

Plan first

Before you begin to diversify, though, you should, of course, consider the implications any new business will have on your current business. For instance, you may decide that diversifying may affect the amount of time you can dedicate to your ongoing work. You should ensure you have the required capital to diversify or a sufficient plan to raise funds. Will you be using currently employed staff, in which case will they be able to continue to perform their current role, or do you need to hire new employees to run your new business? These are all considerations you should make and are by no means a comprehensive list.

There are also different legal requirements you need to be aware of if you plan to diversify, which differ depending on whether you’re a tenant farmer or land owner and on the type of business you wish to start. If you’re a tenant farmer, you need permission from the land owner before you begin to utilise any redundant farm buildings and change their function. Further details around the legality of obtaining consent from the landowner can be found in DEFRA’s guide. If you’re the landowner or tenant farmer, you also need to ensure you have adequate planning permission before you begin to convert any farmhouse buildings with the intention of starting non-agricultural activities. Planning permission may be required whenever there’s any form of new development, which includes any diversification, regardless of whether you’re causing any structural changes to the building.

Educate

One popular form of diversification is providing workshops in a skill you might rely on daily, but of which the general public knows little. Dry stone walling, woodworking, and beekeeping, or just general farming duties you perform on a daily basis; these are all skills you might possess, and expertise which people may be keen to learn. Operating out of a once-redundant building can be a cost-effective means of diversification, as there are few startup costs, especially if you intend to teach the lessons yourself.

Of course, the initial cost depends on the current state of the building, and like any business, various health and safety measurements must be met before a business can be opened to the public. These rules apply to all diversification but are especially important if you have members of the public on site. Do you have adequate fire safety protocols, and is all electrical wiring appropriately fitted? For a look at further health and safety criteria you need to meet, consult this government guide.

Beyond health and safety, you should also consider whether the building you’re using is appropriate for the workshop you wish to create. Is the space large enough for an adequate number of attendees? If the class suits an outdoor setting, such as beekeeping requiring an apiary, then is diversifying a disused farm building the right choice?

Tourism and retail

Since the announcement of Brexit, the amount of British holidaymakers who stay in the UK, rather than travel abroad, has increased. This means farmers are in a great position to tap into this market and convert any redundant farm buildings into tourist accommodation, such as a holiday home. This, of course, means you must have an adequately sized building, and that it must have both plumbing and electricity. Depending on the state of the building, this can also entail considerable restructuring work and reasonably high costs before you can begin selling to tourists.

Before you write holiday lets off as an expensive endeavour, you may be entitled to government grants that can offset some of the initial costs. The Rural Enterprise Scheme (RES) offers funding, by application, to agricultural businesses that either benefit the environment or the community, which includes tourism.

To help improve your chances of receiving funding, it might be worth considering offering environmentally friendly accommodation, such as utilising solar power or wind power, as this is something the RES encourages.

The funding available to farms varies, depending on location. Cornwall, the Isles of Scilly and parts of Merseyside and South Yorkshire are not covered because they have their own local funding schemes. To find out more about what funding the RES offers you in your region, check your local district county council’s website.

Another good way to both increase revenue and promote tourism by diversifying is opening a farm shop or a pick your own. This would allow you to directly sell products you’re already growing, meaning it could tie in nicely with your current work. Selling directly to consumers, as opposed to having transport and logistical costs to ship your produce, can also be more cost-effective, as well as increasing your revenue.

As well as selling to consumers, a farm shop can make it easier for you to sell directly to local businesses. This is an excellent way to help maintain a local economy and strengthen your farm shop’s relationship with the community. Restaurants like fresh ingredients from farms and farm shops because they can promote it as being local, which is a big selling point.

Again, with a plan to start a farm shop, applying to the RES for funding is a good idea, as they often support businesses that generate growth in rural communities. The National Farmers’ Retail and Markets Association (FARMA) is another organisation you should contact, as they can offer you help and advice in setting up your farm shop.

Business lets

Beyond promoting agricultural produce, crafts and tourism, you might want to consider offering office space to non-agricultural businesses. For sizeable out-buildings, a conversion into offices can be a profitable business and one that needs only a little investment of your own time once the structural changes have been made.

Having sizeable outbuildings is beneficial here, but don’t necessarily rule out the possibility of cleverly maximising a smaller space. There’s no definitive industry sector which might be interested in an office on a farm, but it’s key that you ensure there are reasonable roads to the office so that commuters can get to work.

As always, ensure planning permission is obtained before beginning any redevelopment.

Kennels and catteries

If you already work with animals, it may be a good idea to diversify in this area by converting any unused farm buildings into a kennel or cattery. Looking after domesticated pets isn’t classed as an agricultural activity because you’re not taking fur or wool or producing food, which means you will need planning permission to begin.

Looking after pets while the owners are otherwise occupied, or opening a sanctuary for unwanted and abandoned pets can involve a lot of work, as the animals need to be properly looked after and attended to.

If in doubt

This blog lists a few possibilities for diversification, but in reality, the number of options open to you is only limited by your ingenuity. If in doubt about the business you wish to set up, contact your local authority to find out what sort of permissions you need, and whether there’s any funding you could be eligible for to help you kick-start your new business.

About the author

Katie Alsop Associate

Katie specialises in contested wills, disputed estates and the removal and substitution of executors. Katie also advises on professional negligence claims particularly in relation to the drafting of wills and the administration of estates. With her agricultural background, Katie also takes a keen interest in disputes with an agricultural aspect.