Farms, Farm Shops and beyond (Part 2)

Expansion of a farm enterprise can take many forms. In the second of this two-part series, I'm looking at other ways to successfully diversify your farm business by turning it into a popular destination site.

In part one, we listed numerous approaches to farm diversification, including food service, drinks production, rural tourism, retail and more. We then looked more closely at a couple of the more obvious approaches – the Farm Shop and Café. In part two, we will take a look at yet more ways to bring customers and revenue into your diversified farm business.

Crucially, the economics suggest that keeping customers on site is the key. You now have a farm shop, selling terrific local produce, some from your own farm, additionally from local producers. You have a customer base, a profitable shop, followed by a vibrant café serving top notch farm to fork food.

So where next?

Farm diversification blog buildings

You have space, buildings, parking, location, and customers. New activities can make even better use of your farm’s physical resources and characteristics, find new uses for existing skills and moreover make your farm even stronger. There are few limits on the kind of businesses a farm can diversify into, agricultural or non-agricultural.

Check out my list from Part #1

Let's look, in more detail at a few of these.

Entertaining the kids

Play barns have become very popular and, for some, a successful addition to a farm shop location.

The advantages include being able to make use of additional buildings, create a thriving business and added footfall for other areas. The downsides include the requirement for additional investment, seasonal and weekday fluctuation, the weather, wear and tear and unruly customers.

Farm diversification blog playbarn

So, how to approach this?

As always, first explore an initial concept in depth and decide on the scale of the project, a budget and make a plan. As early as possible, visit others, get recommendations on suppliers and if possible, have really good discussions with others who have made this leap – try to get the 'good' and 'bad'.

It’s important to consider what your unique selling point will be to set apart an indoor play centre from the competition. Understanding the development process is essential and best to see about competition in the surrounding area.

The design will be crucial to the quality of the guest experience which will directly affect the impact on revenue. It is therefore important to decide how high to set the bar as this will determine how much customers are willing to spend, whether they use other parts of the farm shop and more importantly, whether they will return.

It can also be useful to choose a supplier who will design and install the play barn equipment as well as managing the build from start to finish. Planning permission will normally be required.

Aspects to consider are:

  • What sort of food service to offer, if any?
  • How much to charge?
  • Ages targeted – this is important and may require more than one section;
  • Insurance;
  • Staff – training, checks;
  • Cleanliness and repair.

It will also need a sales and marketing plan. It won’t be enough simply to open the doors and hope. As with all aspects of farm enterprise, we need to find customers, plan events, target the quiet periods, communicate and promote.

There are bodies out there to help.

- The Association of Play Industries;

- The Play Providers Association.

Getting lost

Another popular diversification is the Maize Maze. Originating in Pennsylvania, the Maize or Corn maze is cut from a large field of living maize plants and is a good use of land that provides a productive and timely income during the school holidays.

Farm diversification blog maze

These have become more ambitious with time in terms of the size, scope and design of the maze, but can be useful footfall drivers as well as bringing income from paying customers. They also sit well with other activities such as play areas and tractor rides.

For more information, contact the Maize maze Association.

Another home grown crop that can add to the visitor numbers is the pumpkin; if well planned and integrated with a good Halloween series of events, pumpkins add terrific value.

Pumpkins are great fun to grow for children, they are easy to cultivate, but need a sunny position, plenty of water and shelter from cold winds.

Yorkshire farm shop Farmer Copley’s Pumpkin Festival has been running and growing for many years – and now claims to be the largest with, for 2019, around 130,000 pumpkins planned.

Cookery schools

Cookery schools have great appeal – they fit well with the farm shop story, can use local talent, can be built within unused space, can include butchery and baking courses that again create links and bring enthusiastic food-minded customers. However, a school may not be as lucrative a use of the space as a restaurant, but as an exercise in public relations it’s invaluable. If well planned, it can be an opportunity to invite suppliers to do tastings and staff training and attract local residents.

Farm diversification blog cookery school

Cookery schools can of course require a considerable investment – in particular with classes rather than simply demonstrations, so the addition of cooking stations.

The argument for capitalising this may not necessarily be purely financial, but rather publicity orientated. It’s more about having people engage with the farm shop. People go away, they talk, and they come back with friends. It’s an investment in a long term relationship with customers.

Some can run team building days for business customers where a group, and the chance that many customers won’t be experienced home cooks, will watch a cookery demonstration for the morning then have lunch in the restaurant.

PYO

For those of a certain age, pick-your-own evokes memories of a bygone era. However, some farmers consider converting to a PYO because there is reduced labour required for harvesting, it brings additional footfall, is another attraction, and connects the farm with the consumer.

Farm diversification blog strawberries

Personally, I have been cautious due to the potential for damage and of course, the less than honest picker who consumes on the way and expects to pay for only a small amount. I can only recommend building a model that takes this into account. Challenges can be varied, and I would guard against it being the sole source of income as the risks of a bad summer could have a significant impact on footfall thus turnover. Also, you should be aware that such an investment is not cheap, it will take a few years for plants to reach best yields and footfall is limited to the picking season.

Garsons Farm Pick Your Own is probably one of the largest and has been in operation for over 35 years. They grow 30 crops totalling over 75 different varieties - ensuring the picking season lasts from June until October. There are also other examples of well implemented PYO operations, including Craigies Farm Shop, near Edinburgh in Scotland.

Staying on a farm

Farmers who open their gates to weekenders and holidaymakers are taking their farms into a potentially lucrative area. With some capital investment required but potentially healthy returns, this type of accommodation has become a popular choice for some farmers looking to diversify.

People have a curiosity of the countryside, for some it’s an experience and by staying on a farm they get peace and quiet, fresh air, views and great value for money. For many it is about getting that rural experience - and each is unique.

Figures show that the 'Staycation' market is growing 28% year on year and urban dwellers can enjoy a rural experience, often good value, with perhaps on site activities and connections with farming.

The offer can be wide ranging; from traditional 'real' camping, to 'glamping', to stylish shepherds’ huts, log cabins, yurts and, even, tree houses.

Farm diversification blog camping

What are the benefits to farmers?

  • Income;
  • Added footfall to make use of existing commercial offers such as farm shop, café etc.
  • High margin. The hotel model has a high GP with costs being labour (housekeeping), laundry and toiletries;
  • If you go for log cabins for example, these offer self contained facilities and as they are fully insulated, can be used throughout the year. These also have a longer life span than other options.

However, there are a number of considerations before setting up this type of operation.

  • As ever, it needs a business plan. The feasibility of accommodation is based primarily on occupancy rates, normally seen as a % of total available.
  • Housekeeping needs planning based on need and is more efficient with volume of rooms/units.
  • Identifying a site that is accessible but in a quiet area, with attractive views of the surrounding countryside.
  • Access to the main buildings
  • It is important to ensure separation between units to give privacy.
  • Infrastructure services such as electricity, water and drainage.
  • It will probably, as with most of the other areas of diversification, need consent for change of use of the land for temporary or permanent structures. It may be worth speaking to the local council as some local authorities encourage the development of tourism and farm diversification.
  • It’s worth aiming for quality furnishings to achieve premium pricing and good occupancy rates
  • Looking for extras that will add value to the offer such as access to other activities, provision of fridge essentials on arrival, a hot tub, fire pit, BBQ, and bicycles.
  • Operators of this sort of activity will, however, be in the hotel business so it’s important to learn about the technical systems, requirements and customer expectations.
  • Online booking for most is now the norm, so good to find a supplier of this sort of software. It’s also very important to have useful data capture – it’s a long list and not all will be required, but good to consider customer information, occupancy and revenue totals, revenue available per unit and per booking, price comparisons, average occupancy, length of stay.
  • There will be a need to look at those that are able to integrate with the current systems for ease of billing, combining with other activities and introducing promotions
  • Camping is likely to be seasonal.

Some options of suppliers can be found here.

Blackdown Shepherd Huts

Modular Leisure Buildings

Bringing it all together

As the farm enterprise grows, so it probably requires some consistency, of branding, message and tone.

I would encourage owners to take time to look into this. I am not suggesting some sort of corporate stronghold, but to give customers familiarity and to have some solid aspects from which all additions take their lead. I also encourage all to see how best to cross reference and cross promote.

There is a huge range of opportunities here, some are subtle, some involve data capture, and many require a reliable EPOS system to deliver real benefits.

However, I would also make sure it’s a realistic proposition. I am regularly challenged by farm shop owners who question why they do not get much cross trade from one department to another, despite having customers on site. The reasons are varied – it may simply be internal signage, branding or staff who are not engaged.

I do however approach with another reason. If, for example, a parent arrives with children to use a play barn, they are in 'children mode'; finding a fun activity to while away the time. They are not in 'shopping mode'; they probably don’t have a shopping list; it may not be the day of the week when they shop regularly and they simply are not going to buy food.

I should also add that whilst we in the farm shop world are engaged in selling delicious local produce, never forget that the majority of consumers buy their food in supermarkets, and a visitor to a play barn, whilst happy to enjoy that element, may simply not buy food from farm shops.

So, my advice is – enjoy both customers, but don’t beat yourself up if everything you have tried doesn’t work.

Don’t lose sight of why you wanted to diversify in the first place.

Final thoughts...

I may be wrong but, for many farmers, their work is a predictable series of activities – many dictated by the weather, supply chain, seasons and needs of livestock.

When you enter the retail customer world the challenges are different, and the onslaught is relentless.

Yes, as a farmer you already understand long hours and seven days’ work. But consider customers, staff, marketing, competition, the EHO, machinery, seasons, road closures, sickness, complaints – oh, and you may end up losing money.

However, it may also be a lifeline, a huge success, something to provide jobs, and a real sense of community. In my experience, the farmers who really do well, have invested a huge amount of time and energy as well as cash to make these enterprises succeed.

It’s something to note that when farm shops have diversified into any of the areas I have looked at, poor old food retail can get a bit left behind.

It’s the one that challenges most – waste, margin, stock management, labour, etc. and the newcomers, such as play barns and events, just seem easier.

Some of the larger farm retailers are now really either landlords for other retailers or event organisers. Nothing wrong with that – if they are happy to spend their time administrating and collecting rent – with a bit of marketing thrown in.

But, what of the real reason for the development? What of the genuine addition to farming? And what of the pride in simply creating and selling great food?

Keeping yourself motivated can also sometimes be a challenge. When you start a business, you have to motivate yourself and your employees so make sure you find ways to keep it interesting and exciting.

Don’t lose sight of why you wanted to diversify in the first place and make sure you listen to your customers’ needs and please them as much as you can to sustain a successful business.

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Edward Berry

Edward Berry

Contributor

www.theflyingfork.co.uk

Edward operates the Flying Fork, a food and retail advisory service for independent food retailers, farm shops, delis and food producers. He works closely with the Guild of Fine Food, judges Shop of the Year, Great Taste Awards and World Cheese Awards, has worked on projects for FARMA, speaks on industry subjects, mentors at the Speciality Fine Food Fair and is a regular contributor to publications such as the Fine Food Digest.

Great minds think alike.

Let’s put our heads together for a win-win partnership that benefits your business and ours.
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