With the Agriculture Bill still navigating its way through the House of Lords and the country still battling with the impact of COVID 19, one thing that remains certain is that in the words of Noel Edmonds, “Deal or No Deal”, we will be trading as UK Plc on 31st December 2020. What transpires in terms of global and EU trade deals, agricultural commodity trading conditions and the prospects of environmental stewardship and new schemes such as ELMS and, the recently announced, Sustainable Farming Incentive (SFI) is largely unknown. However, the Basic Payment Scheme (BPS) appears set for extinction on a sliding scale between now and 2028. With so much uncertainty, we need to focus on what we can control.
In the case of BPS, being forewarned is forearmed should always be the mantra for any farming business.
There are many changes that will impact farming businesses over the next few years but rather than focus on the challenges, it is a far more worthwhile exercise to recognise the opportunities. With every farming business this should start with an interrogation of your own business and how it is performing – making changes within your own sphere of influence should be the starting point. This can be done by answering a few simple questions:
- What profit do I need to make to remain viable now and in the future?
- Am I making the most use of the resources available to me and the farm?
- Do I use my financial data to determine the cost of production for all enterprises?
- Do I manage my staff in such a way that they are engaged and motivated?
- Am I embracing technological innovations that could make my business more efficient?
- Am I aware of how reducing my carbon footprint could lead to a more efficient farming system?
- Do I have a documented strategic plan for my business to cover the next 5 to 10 years?
Free help service available through ADAS
If you would like assistance with getting started on this journey, ADAS have developed a free service using our financial data analysis tool that allows for current financial performance and profitability to be plotted against a backdrop of declining BPS payments. It will allow farmers to determine the financial gap that they need to fill, and the decisions they need to make, come 2028.
Farmers will need to submit the last 3 years of farming accounts data and in return, ADAS will provide you with a profit requirement and BPS profit impact report and a free visit (COVID19 permitting) to discuss your results.
Please contact either firstname.lastname@example.org on 07920 879094 or email@example.com on 07785318948 for more details.
James Dunn is a Technical Director for Business Development within our Agriculture and Land Management team with expertise in dairy consultancy, financial and business management.
Talk to James at firstname.lastname@example.org or call 07920 879094
Tony is a Senior Business Consultant with over 40 years experience, specialising in business management for dairy and arable farmers.
Talk to Tony at email@example.com or call 07785 318948.