Guide helps farmers decide on diversification options

For many farming and rural enterprises the New Year is the time to take a close look at the farm business to decide what changes can sensibly be made to increase farm income.

Diversification is one option for many farmers. Unused resources of land or buildings can be released to develop long-term sources of alternative income. As more farms seek diversification opportunities a well-thought-out development plan is essential, and this is where Lloyds TSB Agriculture can help.

"Our updated 'Guide to Farm Business Diversification' is just what it says it is. It is designed to help farm businesses see their way through the whole decision-making process by assessing diversification projects and giving example costings for over 70 alternative enterprises," said Tim Porter, Agriculture Director, Lloyds TSB Business Banking.

"Almost half of all farm businesses in the UK are now supplementing their income through non-farming enterprises. The most popular diversification route is renting redundant buildings for non-farming use. Other popular options are retailing farm produce, providing sports and recreation facilities and the development of tourist accommodation.

"The list is endless but diversification is not a decision to be taken lightly. As a first step our guide urges you to consider three key factors when exploring any potential diversification opportunities. Essentially what additional resources does the farm business have, what is the potential market for the new product or service and is the amount of risk you are prepared to take balanced with the amount your business can stand?

"The key is to plan all aspects in detail and subject every idea to the most critical examination of family, business partners, staff and professional advisors. We have 125 specialist managers in 43 regional offices and recommend that farmers speak to their local Lloyds TSB Regional Agricultural Manager, who will be able to help in the decision making process," he said.

Free copies of 'Your Guide to Farm Business Diversification' are available from your local Lloyds TSB Agriculture office or by emailing agriculture@lloydstsb.co.uk