Getting started in the agriculture industry – what are the key mistakes I need to avoid?
After a harsh and prolonged winter, the plight of those working in the agricultural industry has been so great that major banks, farming charities and farming experts have come together to discuss a plan of action for the future at a landmark summit called by Environment Secretary Owen Paterson.
“We should be proud of the fantastic job our farmers do. But this last year has been particularly tough. Farming contributes a huge amount to our environment and our economy. We want to ensure that farmers are able to deal with challenges like bad weather, to grow their businesses, create new jobs and help the country compete in the global race," stated Mr Paterson.
Here are just a few mistakes that those entering the industry will need to avoid to ensure that their business achieves continued success:
Under-budgeting
It is important that before you start your agricultural enterprise that you factor in all relevant costs, and that your budget fully reflects the starting capital you will need to get your business off the ground. This includes costs such as those involved with developing any farmland you have purchased to bring it up to standard, the costs of livestock/seedlings, machinery, tools and other materials.
Failing to investigate legal requirements
There will be a myriad of legal requirements involved in setting up your agricultural business, and you will need to seek out advice on agricultural regulations, labour costs, tax permits and more. Organisations such as The National Farmers Union (NFU) may be able to point you in the right direction. The Department for Environment, Food and Rural Affairs (DEFRA) also has a dedicated Farming Advice Service.
Not developing relationships with suppliers
Building up a relationship with the businesses or individuals you intend to supply your produce to at the earliest opportunity is essential – and this could be anything from local farm shops and restaurants to major supermarket chains, according to the scale of your operations.
Attending business networking events could help with this process.
Failing to anticipate worst-case scenarios
Anticipating worst case scenarios such as your crop failing, or adverse weather conditions, and putting a contingency plan in place will ensure that your business is able to continue its operations under a number of circumstances.
Agricultural businesses that are struggling in the current climate may want to seek insolvency advice on how to stabilise the business and streamline operations.