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LAMMA 2021

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Motivational solutions to business challenges at new FG conference

Farmers Guardian inaugural Business of Farming Conference saw nearly 100 delegates from across the UK convene in Warwickshire last week. Ben Pike reports.


Farmers from across the UK came together to learn more about key challenges facing their business and how to begin to overcome them.


Organised by Farmers Guardian and supported by Farmcare, the Business of Farming Conference was researched with a wide number of farmers, from all sectors and regions, who collectively identified the burning business issues they wanted to learn more about.


Speakers challenged the status quo in a thought-provoking event which put forward practical solutions to the challenges facing the farm business of today and in the future.


Over registration, delegates spoke about their enthusiasm to hear an open discussion on the stigma of succession planning as well as sessions of professional development, covering negotiation and personal management.


Briefing Media’s group head of content Emma Penny said: “We spoke to a lot of farmers to find out what they want to learn about so this conference has been put together to reflect all the things that people have asked for.”


Richard Quinn, chief executive of Farmcare, added: “There’s a huge opportunity to restructure what we do and how we do it and we need to take time out to think about how to build a resilient farm business.”


Putting success in to succession

Putting success in to succession

Tackling succession on his family farm was far from plain sailing for 25-year-old Doug Fleming.


Farming with his father and brother across 312 hectares (770 acres) of owned and rented land in the Scottish Borders, a lack of communication hampered progress and raised tempers when the issue was first discussed.


Doug said: “It was brought up during a heated argument. My dad thought we were trying to pay him out and get him out the way.”


“It needed sorting out, but it was unlikely that we would be able to buy one or more people out of the business.”


The turning point came when Doug attended a Scottish Association of Young Farmers Clubs rural leadership course. He met others who were in the same situation and took professional advice on how to approach it.




He returned home and sparked an open conversation, which led to the realisation that all family members were pushing for the same thing.


The main problem was that the business was not big enough to sustain the two brothers and their parents for the rest of their career and in to retirement.


“In 2015 we developed some holiday lets and a biomass boiler – both will provide an income for the family in retirement when it’s all paid off.


“My brother has taken a controlling share in the family business and I have taken a tenancy on a neighbouring farm my own name.”


Doug believes communication was the key in overcoming the challenges as each and every one arose.


“We had never actually discussed succession. I never knew dad’s attitude towards it until tackling it head on. We’re now more of a team. It’s not 100 per cent resolved but we are on the way.”


Reaping rewards


Roger Mercer tackled succession early for a reason.


“There’s a clear correlation between those who have a succession plan and the success of the business. Those doing the doing have to be in control of their own destiny,” said the Staffordshire farmer who manages a total of 11,000 acres in the UK and Australia.


To that end Roger talked openly with his three sons – Robert, Alec and Tom – to form the basis of a plan when they were just teenagers.

Now all in their 30s, Robert and Alec have started Packington Pork and Packington Poultry, while Tom set up on-the-go breakfast brand Moma in London.


A detailed, complex model sees all parties have a stake in each others’ farming business but with free reign to make decisions on their own enterprises.


Every year the family set aside a day away from the farm to discuss succession and update a family constitution which details how succession is to be handled.


Roger said: “Everything has to be on the table – all goals and aims, even wills.


“Our business has grown faster because we have this system. There’s a great source of satisfaction and pride in watching your family crack on and achieve things. I believe it’s every family’s duty to allow the development of those within it.”

Facilitating change

Facilitating change


Succession planning facilitator Sian Bushell says it is the responsibility of the older generation to start the conversation.


“The fact you are not having that conversation is already causing upset, dispute and unhappiness in the family,” she said.


“I guarantee there’s somebody in your family who’s feeling frustrated and someone that’s feeling insecure.”


She said that, anecdotally, one in four farming family members aren’t speaking to each other because of a fall out over succession.

Succession planning facilitator Sian Bushell’s top tops:

  • Pick your moment carefully – when people are relaxed and happy to talk
  • Understand where everyone else stands – listen before talking
  • If someone doesn’t want to talk about succession, draw up an agenda for the meeting and tell them it is taking place with or without them
  • Start with the easy topics first – don’t go straight into money and ownership
  • Start the process early – the earlier you start the more options you have
  • Don’t make the subject taboo – talk about it often

Loan applications: what a banker wants to know

Attention to detail is one of the constituent parts of a successful bank loan application.


Failure is often linked to farmers not being able to convince lenders they know their income and expenditure, said Paul Brough from Barclays Agriculture.


“Phrases like ‘I think I need to borrow this amount’ scare me to death,” he said.


“A bank manager wants to leave the kitchen table with confidence in your ability to repay all your debts comfortably.”


Businesses should be able to provide details of their historic trading performance, outline the profit it has made and what is has done with those funds.


And money set aside for monthly repayments should be at least one and a half times the required amount.


Mr Brough said: “A key question is what is your break-even price is? How much wriggle room have you built in to your forecasts?


“Clear, well communicated applications need to be realistic and based on what you’ve done in the past, covering off the what-ifs.”

What do you need to think about?

Paul Brough says farmers need to ’paint a picture’ to a bank to show them how much money they need, why they need it and prove that they can repay it comfortably.


Here are some of the credentials a lender will consider when assessing an application.


  • Character – Do you understand the strengths and weaknesses of your business? Can you adapt to change?
  • Ability - Are you a good farmer and are you good in business?
  • Management – How good are you at managing your finances? If you want to expand, do you have the management skills to do that?
  • Purpose – What do you want the money for? Does it fit your business strategy?
  • Amount – Exactly how much do you want? Don’t just go for a round figure, tell us how you got to that figure and get estimates.
  • Repayments – Can you afford the repayment? Are you generating sufficient profits to repay the loan comfortably?
  • Insurance – Do you have assets you can loan against? Typically banks would look for a 35 per cent loan to value

Dating agency for farm finance

Dating agency for farm finance

A financial dating agency linking farmers who need funding with rural lenders is being pitched as a new solution for short-term loans.


Matt Waterfield from Folk2Folk said peer-to-peer lending matches borrowers and lenders with deals lasting a maximum of five years.


Farm shops and other diversification projects have been among the projects financed in this manner since the company started in 2013.


While based in the South West, the company is already expanding into the Midlands and further into the North with plans to help more farmers secure funds.


The minimum sum that can be invested or borrowed is £25,000 but average loans are currently at £250,000.


“Rural investors are looking to invest significant amounts of money and in return they get an interest rate of 6.5 per cent,” Mr Waterfield said.


“They know who that business is and the borrower knows who lent them the money.”


Borrowers pay an interest rate of 7.5 per cent, with 1 per cent going to Folk2Folk.


Mr Waterfield added: “The security backing the loan is most important. There is no compensation scheme so the lenders want to know about the land and property behind the lending.”


Lenders are looking to lend up to 60 per cent of the forced sale value of the land and property – usually about 40 per cent of the market value.

Using technology to control costs

With increasing emphasis being placed on managing costs to improve profitability, a farmer’s son from south Norfolk has launched a price comparison site for farm inputs.


Yagro founder Daniel Jolly says increased visibility of outgoings is a cornerstone of a successful, profitable business.


His internet platform allows users to source quotes from leading suppliers and choose the most competitive


“It’s very surprising how much farmers focus on volume with less focus on costs,” he said.


“It’s easy to get visibility of your volume but not so easy when dealing with costs.”


Farmers can compare prices of chemicals, fertilisers, fuel, feed, seed and lubricants. Search results provide a quote from a number of suppliers, along with a delivery date.


To emphasise the difference between enterprises in controlling costs, Mr Jolly added that the top-performing 25 per cent of arable farms made a profit of £71/ha (£29/acre) in 2015, while the average arable farm made a loss of £296/ha (£120/acre).

What delegates said

What delegates said

Elizabeth Asquith, North Yorkshire

“The conference was a good opportunity for networking and to find out about managing finances. Our family has a small pig and poultry unit but I want to expand and start our own business. The event has been useful for me. Really informative.”


Oliver scott

Oliver Scott, South Norfolk

“I’m a farm manager on an estate and I can see that there could be some succession decisions to be made so I came to the conference from that point of view. I’m also looking to segregate the various enterprises on the estate so I was looking for professional advice to take back home with me and it was really useful for that.”

oly white

Oly White, East Yorkshire

“I’m from a traditional family farm and we have taken on quite a few rented acres recently. I came to look for new ideas and opportunities, particularly with on financing options for family farms. The networking has been good too.”

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