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Ploughing your own furrow


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Unearthing a blueprint for new entrants striving to establish their own farm business in the UK

Unearthing a blueprint for new entrants striving to establish their own farm business in the UK

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  • 1.        PLOUGHING  YOUR  OWN  FURROW:   Unearthing  the  blueprint  for  new  entrants  striving   to  establish  their  own  farm  business  in  the  UK.             G e o r g e   B r o w n                                 A p r i l   2 0 1 2  
  • 2.             ACKNOWLEDGEMENTS   I   am   grateful   to   a   number   of   individuals   who   have   been   incredibly   patient   in   answering   my   many   and   varied   questions.     While   the   views   presented   here   do   not   necessarily   reflect   their   own,  they  have  been  invaluable  in  shaping  arguments  in  this  study.    They  include:     • Ruth  Layton  of  FAI  Farms,     • Mike  Gooding  of  FAI  Farms,  Chairman  of  the  Oxford  Farming  Conference  Council  2012   • Charles  Baines  of  Laurence  Gould   • Alison  Rickett,  National  Fresh  Start  Coordinator   • Richard  Gooding  of  BQP   • Martin  Law  of  Hardcastle  Burton   • Jim  Baird,  Nuffield  Scholar  2011   • George  Dunn,  Chief  Executive  of  the  TFA   • Oliver  Hardwood,  Chief  Surveyor  at  the  CLA   • Rupert  Clark,  Partner  and  Head  of  Rural  Estate  Management  at  Smiths  Gore   • Ian  Pigott,  Nuffield  Scholar  2002  and  Founder  of  Open  Farm  Sunday   • Sarah  Palmer,  NFYFC  Agriculture  and  Rural  Affairs  Officer   I   am   also   extremely   grateful   to   the   farmers   who   agreed   to   be   case   studies   in   this   project.     They   provided   me   with   a   fantastic   array   of   information   and   are   some   of   the   most   inspirational   people  I  have  ever  met.    They  are  listed  in  the  appendices  at  the  end  of  this  study.   Finally   I   would   like   to   thank   my   college   for   their   support   in   funding   some   of   the   travel   expenses   incurred   in   undertaking   this   research,   and   Mary   Young,   my   long   suffering   dissertation  supervisor,  for  all  of  her  help  in  developing  this  report.     2  
  • 3.         CONTENTS   Introduction   4   Literature  Review   5   Methodology   11   Data  Presentation   12   The  Blueprint  –  Land   15   The  Blueprint  –  Capital   24   The  Blueprint  –  Output   29   The  Blueprint  –  Labour   34   Conclusion   38   Endnote   42   Bibliography   43   Appendices   49         3  
  • 4.   INTRODUCTION  Concern   over   the   number   of   young   people   pursuing   careers   in   agriculture   has   recently  received   much   attention   in   the   farming   press.     A   number   of   factors   have   been   highlighted   as  contributing  towards  the  aging  agricultural  workforce,  but  to  date  the  literature  available  has  offered  little  in  the  way  of  practical  guidance  for  new  entrants  striving  to  establish  their  own  farm  business.    Two  quotations  succinctly  contextualise  this  issue,  and  consequently  clarify  the  aim  of  this  dissertation.   “Encouraging   the   next   generation   to   be   motivated   about   starting   their   own   business   is   vital   to   building   a   stronger   future   for   British   farming.     We   need   young  people  with  ideas,  ambition,  commercial  acumen,  skills  and  drive,  if  the   challenge  of  producing  more  food  and  impacting  on  the  environment  less  is  to   be  realised.”  (King,  2011)     “This  winter  [2011/2012],  CAP  reform  aside,  I  have  heard  more  presentations   on   ‘new   entrants’   than   anything   else.     The   subject   is   hugely   important,   but   I   have  been  disappointed  by  the  array  of  papers  I  have  heard.    None  have  offered   any  substance  beyond  rhetoric  and  utopian  wishes.”  (Pigott,  2011)    This  paper  seeks  to  look  beyond  the  “rhetoric  and  utopian  wishes”  and  uncover  the  practical  means  by  which  new  entrants  to  agriculture  to  establish  a  thriving  farm  business?  Definitions   “There   are   three   recognised   routes   to   farm   ownership:   patrimony,   matrimony   and     parsimony.”  (Shadbolt  and  Martin,  2005,  p270)    The   terms   ‘new   entrant’   and   ‘young   farmer’   shall   be   used   interchangeably   throughout   this  analysis.    Art.  8  Council  Regulation  Ec  1257/1999  defines  a  young  farmer  as  someone  under  40  years  of  age,  possessing  adequate  occupational  skills,  setting  up  as  the  established  head  on  an  economically  viable1  agricultural  holding  for  the  first  time.    While  this  definition  is  not  without  fault2,  it  nonetheless  serves  as  an  adequate  guideline  in  defining  the  type  of  person  described  as   being   a   ‘new   entrant’   in   this   paper.     Nevertheless,   more   simply,   how   can   ambitious   young                                                                                                                  1  ‘Economically  viable’  is  defined  as  fulfuling  one  of  the  thresholds  given  in  Regulation  (EC)  No  1166/2008  ANNEX  II,  namely  that  the  holding  consists  of  more  than  5  hectares  of  agricultural  land,  one  hectare  of  orchards,  0.5  hectares  of  vegetables  or  0.1  hectares  of  protected  crops,  or  more  than  10  cows,  50  pigs,  20  sheep,  20  goats,  or  1,000  poultry.    The  same  criteria  are  also  used  by  DEFRA  (2010)  to  define  the  minimum  threshold  deemed  to  be  ‘commercial’.  2  For  example,  a  ‘new  entrant’  may  not  be  establishing  themselves  as  the  head  of  the  holding  straight  away,  or  may  have  already  gained  a  delicate  foothold  in  the  industry  but  still  face  a  number  of  obstacles  that  are  the  same  as  those  faced  by  someone  deemed  to  be  a  ‘new  entrant’  (TFF,  2008),     4  
  • 5.  people  with  little  prospect  of  acquiring  a  farming  enterprise  through  patrimony  or  matrimony,  assist  themselves  in  developing  a  farm  business?    A  health  warning     “[T]he  first  rule  of  first  generation  farming  is  you  don’t  whinge  –  it’s  up  to  you  and  no   one  else.”  (Blanche,  2011,  p11)      While   it   will   be   demonstrated   that   a   number   of   factors   currently   make   it   difficult   for   new  entrants   to   establish   a   farm   business,   it   is   not   the   intention   of   this   paper   to   criticise   current  policy  or  campaign  for  reform.    Instead  the  aim  is  to  analyse  solutions  to  the  barriers  to  entry  as   they   currently   exist.     To   many   these   metaphorical   hurdles   seem   insurmountable,   and   it   is  therefore   hoped   this   dissertation   will   examine   some   of   the   ways   in   which   successful   new  entrants  have,  and  can,  overcome  them.  This  analysis  will  not  seek  to  unearth  a  single  ‘best’  solution;  farming  is  an  incredibly  diverse  industry  therefore  a  one-­‐size-­‐fits-­‐all  answer  is  unlikely  to  exist.    That  said,  there  are  a  number  of   common   issues   facing   new   entrants,   thus   it   is   not   unreasonable   to   suggest   that   there   may  also  be  a  number  of  common  solutions.         LITERATURE  REVIEW    Agriculture’s  labour  force   “[T]he   industry   is   facing   a   recruitment   and   succession   crisis   with   the   average   age   of     farmers  in  the  UK  at  58  and  rising.”  (The  National  Trust,  2001,  p2)  In  England,  52%  of  farmers  are  aged  over  55,  compared  to  just  22%  of  the  self-­‐employed  urban  workforce   (ADAS,   2004).     Nationally,   the   median   age   of   farm   holders3   varies   from   55   to   60  years  across  all   farm   types   (DEFRA,   2011),  and  almost  half  of  National  Trust  tenant  famers   are  past  retirement  age  or  within  10  years  of  it  (The  National  Trust,  2008).      The  problem  extends  beyond  just  the  age  of  farm  holders.    In  the  UK  a  quarter  of  the  sector’s  workforce  is  55  or  older4  (LANTRA,  2011a).    Across  Europe  this  figure  is  higher  still,  with  47%  of  agricultural  workers  in  the  EU-­‐15  being  55  years  or  older  (DGARD,  2010),  and  while  there  has   been   a   decrease   in   the   total   number   of   farmers   by   9%   from   2000-­‐2007,   the   number   of  farmers  under  the  age  of  35  has  fallen  by  42%  in  this  same  period  (DGARD,  2010).                                                                                                                  3  The  ‘holder’  being  defined  as  the  person  in  whose  name  the  holding  is  operated  (DEFRA,  2011)  4  Compared  to  a  UK  average  of  17%     5  
  • 6.  British   further   and   higher   education   institutions   have   been   producing   just   50-­‐70%   of   the  recruits   that   UK   employers   need5   (Spedding,   2009),   and   the   National   Employer   Skills   Survey  2009   revealed   that   8%   of   UK   agricultural   industry   employers   had   a   vacancy   at   the   time  (LANTRA,  2011b).  Farming   is   ‘crying   out’   for   new   entrants   (Tasker,   2011).       Forecasts   suggest   that   the   UK  agricultural   industry   will   need   approximately   60,000   new   entrants   coming   into   the   sector  between  2010  and  2020  (LANTRA,  2009;  Spedding,  2009;  LANTRA,  2011a),  and  it  is  apparent  that   even   if   overall   employment   in   agriculture   does   continue   to   decline6,   there   will   still   be   a  significant  demand  to  replace  those  who  are  exiting  from  the  sector  (Spedding,  2009).      The  significance  of  an  aging  agricultural  workforce     “The  key  to  developing  an  agricultural  industry  we  can  be  truly  proud  of  in  a  worldwide   context   is   innovation.     They   key   to   innovation   is   new   ideas   and   individuals   willing   to     develop  these  ideas  with  dynamism.    Innovation  is  a  dish  best  served  by  the  desperate   and   the   different,   those   with   little   to   lose   but   a   massive   need   to   succeed.”   (Blanche,   2011,  p7)    Dwindling   entry   of   such   magnitude   normally   characterises   an   industry   in   decline   (Gale,   1993),  however   as   agriculture   and   food   are   strategic   sectors   impacting   significantly   upon   rural  communities  and  the  British  economy  (ADAS,  2004;  Williams,  2006;  Price’s  Trust,  2008;  CEJA,  2011),   this   degeneration   cannot   be   allowed   to   occur   unchecked.     Farming   needs   to   attract  progressive   and   entrepreneurial   individuals   with   outstanding   business   management   skills,  who  embrace  change  and  steer  the  political  agenda  (Spedding,  2006,  2009).  Studies   have   identified   age   as   a   barrier   to   the   introduction   of   more   effective   and   efficient  management  practices  (Foskey,  2005  cited  in  Owen,  2009)  and  it  is  noted  that  the  innovative,  entrepreneurial   and   risk   taking   abilities   of   new   entrants   are   beneficial   to   the   industry  (Shadbolt   and   Martin,   2005;   Owen,   2009).     Younger   farmers   have   been   shown   to   be   better  trained   than   their   older   counterparts7   (DGARD,   2010),   and   new   entrants   are   also   considered  more  adaptable  and  more  focussed  on  longer-­‐term  success  (Williams,  2006).    Farmers  below  35  years  old  also  show  40%  more  economic  potential  than  their  superiors  (DGARD,  2010).                                                                                                                      5  Although  is  should  be  noted  that  enrollment  on  agriculture  and  related  courses  has  recently  increased,  and  in  fact  saw  the  greatest  percentage  increase  across  undergraduate  courses  between  2009/10  and  1010/11  (HESA,  2012)  6  Which  would  seem  likely  given  that  it  is  a  near-­‐universal  feature  that  the  percentage  of  the  population  involved  in  agriculture  declines  with  a  nation’s  increasing  economic  development  (ADAS,  2004)  7  “The  share  of  farmers  with  full  agricultural  training  decreases  with  increasing  age  of  the  farmer”  (DGARD,  2010  p.21)     6  
  • 7.  Moreover,   Lobley   et   al.   (2002)   categorised   farmers   into   3   groups:   those   who   ‘embrace’   change  (31%   of   respondents),   those   who   change   in   response   to   new   pressures   and   opportunities  (‘reactors/adaptors’,  51%)  and  those  who  ‘resist’  change  (18%).    While  every  age  group  could  be   found   in   each   category,   ‘embracers’   were   generally   shown   to   be   better   educated8,  “somewhat   younger”   and   on   bigger   farms9.     This   goes   some   way   towards   explaining   why,  despite  the  fall  in  number  of  young  farmers  across  the  EU-­‐12,  there  has  been  an  increase  in  the  area  farmed  by  them,  implying  that  those  few  who  have  stayed  in  business  have  increased  the  size   of   their   holdings   (DGARD,   2010)   and   that   it   is   they   who   are   therefore   achieving   the  economies   of   scale   required   to   keep   many   farm   businesses   viable.     Lobley   et   al.,   (2002)   also  found  that  ‘static’  businesses  were  far  less  likely  to  be  operated  by  young  farmers10,  suggesting  that  an  ambitious  young  workforce  could  strengthen  a  dynamic  agricultural  industry.  Thus,  the  main  reason  that  the  aging  agricultural  workforce  is  an  area  of  policy  concern  is  the  association   of   young   farmers   with   increased   efficiency,   adaptability   and   ultimately  competitiveness   (ADAS,   2004).   “Young   people   matter   for   farming;   we   need   their   vitality   and  new   ideas   to   help   meet   the   challenges   of   increasing   food   production   and   climate   change”  (Princes  Trust,  2008,  p.2).      Of  course  there  remains  a  place  for  the  older  generation  in  farming;  their  wealth  of  skills  and  experience   is   undoubtedly   beneficial.     Nevertheless,   there   is   a   strong   body   of   evidence  suggesting   that   it   would   be   advantageous   for   the   average   age   of   the   industry   to   be   reduced.    After   all,   what   looks   like   a   daunting   future   to   a   60-­‐year-­‐old   farmer   may   represent   a   golden  opportunity  to  a  driven  30-­‐year-­‐old  (Chamberlain,  2006;  Spedding  2006).  Factors  discouraging  entry  to  agriculture   “Most  people  imagine  farmers  to  be  dull,  conventional,  conservative  and  Conservative.”     (Naylor,  2011)    A   number   of   negative   stereotypes   discourage   prospective   new   entrants   from   considering  careers  in  farming.    There  is  a  perception  that  agricultural  employment  involves  working  long                                                                                                                  8  71%  of  embracers  had  some  post-­‐school  education  or  training,  and  44%  were  educated  to  diploma  or  degree  level  (compared  to  11%  of    ‘resistors’)  (Lobley  et  al.,  2002)  9  Embracers  represented  31%  of  the  respondents,  but  were  responsible  for  45%  of  the  area  surveyed  (Lobley  et  al.,  2002)  10  Only  18%  of  operators  of  static  businesses  were  aged  under  45,  while  73%  of  static  businesses  had  been  in  the  hands  of  their  current  operator  for  20  years  or  more  (Lobley,  et  al.,  2002).     7  
  • 8.  hours11   for   low   wages   (Padwick,   2010;   IGD,   2008   cited   in   DEFRA,   2010),   and   that   it   is   a   low  skilled   industry12   (Curry,   et   al.,   2002;   Kyle,   2006),   needing   to   become   more   professional  (Spedding,  2006).    The  result  is  that  potential  new  entrants  don’t  believe  farming  offers  them  a  future  (The  National  Trust,  2008),  and  there  is  strong  consensus  that  the  industry  is  struggling  with  an  out-­‐dated  image  (Spedding,  2009).  Nonetheless,   although   beneficial   in   understanding   the   context,   combating   the   stereotypes  surrounding   agricultural   employment   is   an   entire   issue   in   itself,   beyond   the   scope   of   this  evaluation.     Of   greater   relevance   to   this   study   are   the   practical   problems   facing   prospective  farmers   that   have   served   to   discourage   entry   into   the   industry   and   therefore   encourage   an  aging  workforce.    There  are  two  key  problems  in  this  area:  the  poor  availability  of  land  and  the  high  start  up  costs  of  establishing  a  farm  business  (Williams,  2006;  Ilbery,  2009;  DGARD,  2010;  Blanche,  2011),  the  two  issues  being  closely  linked.  UK  farmland  supply  in  relation  to  new  entrants   “Without   doubt,   access   to   land   remains   the   single   greatest   structural   obstacle   facing     the  new  generations  of  farmers  and  growers.”  (Payne,  2012)    Older   farmers   in   the   industry   who   don’t   want   to   retire   restrict   the   ‘room’   available   for   new  entrants  (Owen  and  Cowap,  2009).    Retirement  from  farming  is  often  a  progressive,  drawn-­‐out  affair,  different  from  the  dramatic  change  in  lifestyle  often  experienced,  for  example,  by  blue-­‐collar   workers   (ADAS,   2004).     Indeed,   Errington   (2002)   identified   a   “succession   ladder”   within  farm  businesses,  where  retirement  of  the  older  party  is  protracted  over  5  stages13.                                                                                                                  11  ONS  statistics  show  the  average  working  week  in  the  agriculture  and  fishing  sector  is  46.4  hours,  (compared  to  a  national  average  of  31.7  hours  per  week  in  the  period  April-­‐Jun  2011)  and  rises  to  50.8  hours  when  only  the  hours  worked  by  men    (who,  after  all,  account  for  77%  of  the  workforce  in  agriculture  (LANTRA,  2011b))  are  considered  (ONS,  2011b).    The  average  number  of  hours  worked  by  employees  in  agriculture  climbs  further  still  when  farm  workers  specifically  are  calculated,  rising  to  52  hours  per  week.    On  top  of  this,  during  peak  times  the  average  number  of  hours  in  a  farm  worker’s  week  escalates  to  80  hours,  with  23%  of  them  working  100+  hours  in  their  peak  week  (Padwick,  2010)  12  In  spite  of  the  considerable  skill  level  within  the  industry,  only  20%  of  the  workforce  are  qualified  to  level  4  and  above,  and  24%  have  no  qualifications.    This  is  compared  with  36%  and  7%  respectively  across  all  sectors  in  the  UK.  (Higher  Education  Statistics  Agency  cited  in  LANTRA,  2011b)  13  First  technical  and  tactical  decisions  are  shared,  such  as  day  to  day  planning  and  organisation  of  work.    Secondly  the  successor  becomes  involved  in  strategic  planning  of  the  business  and  in  long  term  decision  making.    Then  employment  and  staff  management  decisions  are  shared,  before  fourthly  the  successor  becomes  directly  involved  in  financial  matters  such  as  negotiating  sales  and  loans.    The  fifth  and  final  stage  in  completing  succession  of  the  farm     8  
  • 9.  Personal   reasons   that   discourage   the   retirement   of   older   partners   from   farms   include   their  enjoyment   of   farming,   a   desire   to   maintain   control,   general   inertia,   their   ability   to   work   to   a  greater   age   and   emotional   ties   to   the   business   (ADAS,   2004;   Baird,   2011;   Hanson,   2011).    Financial   issues   such   as   being   unable   to   afford   to   retire,   an   inadequate   pension,   subsidies  cushioning   risk   (Mishra   and   El-­‐Osta,   2008,)   and   inheritance   tax   advantages   are   seen   to   further  delay   retirement,   as   do   practical   problems   such   as   the   lack   of   a   successor14   (Williams,   2006;  Ilbery,   et   al.,   2009).     Thus,   for   many   reasons   farmers   may   avoid   retirement,   restricting   the  supply  of  land  for  new  entrants.  Combined  with  this  is  the  difficulty  new  entrants  face  in  obtaining  tenancies  from  traditional  sources.    While  the  National  Trust  owns  245,000  hectares  of  countryside15  (The  National  Trust,  2001),   turnover   of   Trust   farms   is   slow16   (The   National   Trust,   2008).   County   Council  Smallholdings   (county   farms)   are   also   hard   to   come   by,   with   the   number   having   fallen   by  72.5%  from  1964-­‐2007  (Ilbery,  et  al.,  2009)  as  holdings  were  sold  off  or  amalgamated  to  create  bigger  units17  (Gemmill,  2005;  Ilbery,  et  al.,  2009;  LANTRA,  2009;  TFA,  2010;  RICS,  2011a).  The  options   open   to   new   entrants   to   acquire   land   through   these   two   traditional   routes   are  therefore  negligible.  Simultaneously,  land  values  have  been  climbing.    It  is  generally  accepted  that  farmland  prices  are   high   in   relation   to   their   potential   productive   agricultural   return   (ADAS,   2004;   Gemmill,  2005;   Shadbolt   and   Martin,   2005),   and   they   reached   record   highs   in   the   first   half   of   201118  fuelled  by  increasing  demand  from  commercial  buyers  (RICS,  2011b).    Referred  to  as  being  like  “gold  with  a  cash  flow”  (Farming  Today,  2012),  land  remains  a  prime  asset  class  in  turbulent  markets  (RICS,  2011b)  and  commercial  buyers  continue  to  invest  in  order  to  increase  output  and  capitalise  upon  strong  commodity  prices.    Residential  demand  also  remains  firm,  with  the                                                                                                                                                                                                                                                                                                                                                                                      business  occurs  when  the  successor  is  finally  given  control  of  the  purse  strings,  and  control  of  the  cheque  book  is  relinquished  (Errington,  2002).  14  Due  to  children  from  farming  families  electing  other  career  paths,  there  being  no  other  family  members  wanting  to  take  up  the  reigns,  or  the  business  being  unable  to  sustain  the  involvement  of  another  partner  (Williams,  2006).  15  60%  of  which  is  let  out  as  whole  farms  to  700  tenants  (The  National  Trust,  2001)  16  Only  ten  to  fifteen  National  Trust  farms  become  available  to  let  each  year  (The  National  Trust  2008)  17  Currently  the  national  estate  stands  at  less  than  125,000  hectares,  with  Cambrigeshire  Country  Council  owning  more  than  10%  of  this;  holding  an  estate  of  13,500  hectares    (Cambridgeshire  County  Council,  2011a).    However  even  in  Cambridgeshire,  just  3  new  tenants  were  taken  onto  County  Council  farms  during  2011,  illustrating  how  few  holdings  are  available  (Cambridgeshire  County  Council,  2011b).  18  At  £7,479  per  acre  for  land  which  includes  a  residential  component,  and  a  hypothetical  £6,115  per  acre  for  pure  bare  land  values  (RICS,  2011b)     9  
  • 10.  ‘lifestyle   value’   of   land   being   high   (Ingram   and   Kirwan,   2011)   particularly   in   areas   close   to  large   conurbations.     Thus   it   is   apparent   that   the   demand   for   farmland   from   commercial   and  lifestyle   buyers   contributes   to   higher   land   values   that   price   many   young   farmers   out   of   the  market.  A  remaining  option  for  new  entrants  is  to  rent  land  under  Farm  Business  Tenancies19  (FBTs).    Created  to  reduce  tenant  immobility  and  thus  encourage  the  letting  of  agricultural  land  (ADAS,  2004),   FBTs   theoretically   offer   new   entrants   the   opportunity   to   farm.     However,   in   helping  young  farmers  the  effects  of  the  ATA  1995  have  been  ‘disappointing’  (Whitehead,  et  al.,  2002;  TRIG,  2003).    When  FBTs  do  become  available,  demand  for  land  from  neighbouring  farmers  is  often  high  as  they  anticipate  being  able  to  increase  output  without  much  increase  in  fixed  costs  (ADAS,  2004)  thus  meaning  they  can  outbid  new  entrants.    The  result  is  that  new  entrants  “feel  barred  to  a  great  extent  from  taking  up  such  opportunities  because  of  the  high  rents  and  stiff  competition   from   established   farmers   for   the   FBTs   available”(Whitehead,   et   al.,   2002,   p60).    Furthermore,   the   short   duration   of   many   FBTs20   (Ingram   and   Kirwan,   2011;   Walker,   2011)  prevents  tenants  from  planning  for  the  long  term.  Capital  costs  of  farm  business  establishment   ‘For  the  group  of  former  students  not  brought  up  on  a  farm  but  who  had     intended  to  enter  farming,  lack  of  capital  was  the  main  constraint”  (ADAS,   2004)    There  are  large  capital  costs  associated  with  building  many  farm  businesses,  and  it  is  generally  the  excessive  fixed  costs  rather  than  high  variable  costs  that  are  problematic  for  new  entrants  (Shadbolt   and   Martin,   2005).     For   example,   to   purchase   11721   freshly   calved   dairy   cows   at   July  2011  prices22,  would  cost  £151,398  and  that  is  before  any  of  the  infrastructure  necessary  for  their   management   has   been   purchased.   Put   in   perspective,   this   figure   is   almost   7   times   the  average   annual   salary   of   a   farm   worker   (Padwick,   2010),   reinforcing   how   large   this   capital  threshold   is   likely   to   seem   to   prospective   young   farmers   seeking   to   develop   their   own   farming  enterprise.      Additionally,  new  entrants  suffer  from  diseconomies  of  scale  in  establishing  their  businesses,  meaning   that   their   capital   costs   are   comparatively   higher   than   those   of   larger   producers                                                                                                                  19  Introduced  by  the  Agricultural  Tenancies  Act  1995  (ATA  1995)  20  The  average  length  of  FBTs  is  now  consistently  under  four  years  (TFA,  2010;  RICS,  2011a)  21  The  UK  average  dairy  herd  size  in  the  2010  June  Census  was  117  cows  (DairyCo,  2011)  22  The  average  price  of  freshly  calved  dairy  cows  in  July  2011  was  £1,294/head  (AHDB,  2011)     10  
  • 11.  (ADAS,   2004;   Shadbolt   and   Martin,   2005).     The   capital   costs   in   starting   a   farm   business   are  therefore  a  significant  ‘barrier  to  entry’  faced  by  new  entrants.  Agricultural  subsidisation   “I   have   never   been   comfortable   with   agricultural   subsidies…   They   diminish   the     impetus   to   innovate,   they   protect   inefficiency   and   therefore   reduce   business   fluidity.”  (Baird,  2011,  p8)    Currently   the   Common   Agricultural   Policy   (CAP)   presents   new   entrants   with   a   number   of  problems,  not  least  that  subsidies  are  capitalised  in  land  and  asset  values,  increasing  the  cost  of  farm   business   establishment   and   expansion   (Baird,   2011).     In   recognition   of   the   difficulties  faced  by  new  entrants,  it  is  expected  that  the  forthcoming  CAP  reforms  will  offer  more  support  for   young   farmers,   most   likely   under   Pillar   2.     However,   while   any   such   measures   will   be  beneficial,   the   current   playing   field   is   so   far   from   being   level   that   any   changes   to   the  subsidisation  scheme  are  unlikely  to  make  it  easy  for  new  entrants.    Thus,  the  ultimate  success  of  any  new  entrant  will  still  depend  more  on  the  “skills,  vision,  determination  and  budgetary  controls”  of  the  young  farmer  than  the  particular  subsidy  on  offer  (Gemmill,  2005,  p4).      This  being  the  case,  what  are  the  options  for  new  entrants  looking  to  overcome  these  barriers  and  establish  their  own  farm  business?           METHODOLOGY     “The  problems  that  are  studied  are  real  ones  to  farmers,  and  so  must  be  studied  in  the     context  of  a  real  world  situation.    Therefore,  the  case-­‐study  approach  cannot  easily  be     divorced  from  the  study  of  farm  management.”  (Shadbolt  and  Martin,  2005,  p11)    The   ‘transdisciplinary’   nature   of   farming23   makes   case-­‐study   based   analysis   essential   in  understanding   farm   business   decision   making   (Shadbolt   and   Martin,   2005),   and   solutions   to  the  practical  difficulties  that  face  young  farmers  today  are  best  identified  through  analysing  the  means   by   which   previous   new   entrants   have   overcome   similar   hurdles.     A   number   of  exceptional   individuals   have   managed   to   develop   farm   businesses,   and   so   it   is   hoped   that  through   interviewing   these   new   entrants   and   understanding   the   variables   that   have  contributed  towards  their  success,  a  number  of  common  factors  have  been  identified  that  could  be  replicated  by  future  young  farmers  looking  to  emulate  their  achievements.                                                                                                                      23  Describing  how  successful  farm  management  draws  upon  many  different  disciplines  to  resolve  a  variety  of  problems  (Shadbolt  and  Martin,  2005)     11  
  • 12.  Such   exceptional   individuals   are   often   highlighted   in   the   farming   press   so   some   have   been  identified   by   this   means.     However,   further   case   studies   were   sourced   through   contacting  prominent   individuals   within   the   industry   and   seeking   recommendations   from   them,   in   the  process  also  drawing  on  their  own  expertise  in  relation  to  this  topic.  It  remains  the  proximal  aim  of  this  study  to  ‘unearth  a  blueprint’  for  young  farmers  seeking  to  develop  their  own  farm  businesses.    While  in  reality  it  may  not  be  possible  to  establish  a  single  ‘best’   template   for   prospective   new   entrants,   to   attempt   to   base   such   a   blueprint   of   the  experiences   of   suboptimal   businesses   would   seem   somewhat   futile.     Accordingly   this   study  remains   focused   on   an   exceptional   minority   of   successful   young   farmers   in   the   hope   that  identifiable  common  factors  can  be  replicated  by  a  wider  majority  of  new  entrants.  Biophysical,  financial  and  human  resources  are  all  employed  in  a  farm  business  (Shadbolt  and  Martin,   2005)   and   conventional   economic   terminology   suggests   these   can   be   classified   as   land,  capital   and   labour.   This   analysis   therefore   evaluates   the   options   available   to   new   entrants  looking  to  resolve  issues  relating  to  land  and  capital  before  discussing  the  output  options  best  suited   to   young   farmers   and   addressing   how   human   factors   influence   the   success   of   new  entrants  to  agriculture.    There  is  currently  a  dearth  of  literature  on  this  topic.    It  is  relatively  easy  to  find  information  on  the  problems  faced  by  new  entrants  and  the  need  for  young  farmers;  it  is  even  relatively  easy  to   find   examples   of   new   entrants   who   are   establishing   their   own   farm   business.       However,  there  is  a  shortage  of  literature  that  coherently  breaks  down  the  issues  and  offers  supported  solutions  (Pigott,  2011),  and  as  such  it  is  hoped  that  this  study  does  just  that.     Data  Presentation  Having   undertaken   the   semi-­‐structured   interviews   and   compiled   a   range   of   case   studies,   it   has  been   necessary   to   categorise   and   retrofit   the   data   into   workable   groups.     Primarily   for  analytical  reasons,  the  data  has  been  collated  into  tables.    The  process  has  enabled  quantitative  comparisons   of   the   case   studies,   with   repeatable   trends   being   identified.     Unfortunately   the  process  resulted  in  the  loss  of  certain  nuances  of  the  data,  and  so  where  appropriate  they  will  be  highlighted  in  the  latter  sections  of  this  study.    That  said,  the  more  direct  analysis  enabled  by  the  grouping  of  the  case  studies  in  this  way,  offsets  the  regrettable  loss  of  some  of  the  data  specifics.         12  
  • 13.  For   a   number   of   case   studies   being   involved   in   a   joint   venture   was   fundamental   in   shaping  their   business,   making   this   a   logical   initial   distinction   with   which   to   group   the   data.     Four   case  studies  fell  into  this  category  (Group  2),  and  common  variables  within  this  grouping  have  been  identified.    Although  there  were  a  number  of  other  new  entrants  whose  businesses  contained  aspects  of  ‘jointness’,  they  have  remained  in  Group  1  as  it  has  been  held  that  being  involved  in  a  joint   venture   was   not   as   fundamental   in   contributing   towards   their   successful   business  development.      Those  enterprises  left  in  Group  1  have  been  sub-­‐divided  into  2  further  groups.    Almost  all  the  businesses  in  Group  1  had  an  initial  part  time  labour  requirement  but  it  could  be  seen  that  a  number  of  the  enterprises  required  a  lower  time  commitment,  had  a  lower  capital  threshold,  were   generally   less   intensive   in   their   land   use   and   were   less   predisposed   to   offering   a  consistent   cash   flow.     These   businesses   have   been   summarised   in   Group   1(b),   while   the   others  have  remained  in  Group  1(a).  One   significant   anomaly   is   apparent   amongst   the   case   studies.     While   characteristics   of  Charlotte  and  Ben  Hollins’  farm  business  are  comparable  with  case  studies  within  Group  1(a)24,  it   would   mask   anomalous   features   of   their   accomplishments   to   include   them.     However,  aspects   of   their   success   are   undoubtedly   replicable   by   other   new   entrants   and   so   will   be  mentioned  where  appropriate  in  latter  sections.    Nevertheless,  in  being  anomalous  in  relation  to   the   groupings   in   this   study,   they   ultimately   serve   to   reinforce   that   there   is   no   single   best  means  by  which  young  farmers  can  develop  their  own  farm  enterprise.      The  grouped  data  is  presented  overleaf.                                                                                                                  24  For  example,  they  have  followed  CSA  principles,  have  utilised  rare  breeds  and  direct  marketing,  and  have  developed  customer  relations  while  employing  extensive  media  coverage     13  
  • 14.   Group   Group  1(a)   Group  1(b)   Group   Group  2     (JV’s)   Core  Enterprise   Dairy,   Pigs,   Poultry   or   4/5  sheep     Vegetable   -­‐   higher     Core   3/4  dairy     output/better   cash     flow   Enterprise   First  Generation?   5/6  first  generation   3/5  first  generation     First   2/4/       Generation?   Formal  Agricultural   5/6  formal  agricultural   4/5   formal   agricultural   Formal   All   possessed   qualification   qualification   Qualification   Agricultural   formal     agricultural   Relevant  skills  develop-­‐ Generally  had  practical   Generally   had   practical   Qualification   qualification     ment  prior  to  enterprise   track  record   track  record   Practical   All   developed     significant   establishment   experience     practical   Sourcing  Land   4/6   prior   contacts   to   4/5   prior   contacts   to   experience,   and   Stakeholder   secure  land   secure  land   Relations   all   had   worked     abroad   Landlord  Size   All   smaller   part   of   Mixed,   often   with   land   Development   All   utilised   landlords   larger   spread   across   a   of  JV  relations   networking   portfolio/  estate   number  of  areas.   contacts   -­‐   this   is     very  important.   Under-­‐ 5/6   made   partial   or   Mixed.     Predominantly   Capital   Land   Personal   capital   Principles  of   Utilised  Land   full   use   of   previously   made   use   of   small   is   essential   –   the   land  use     underutilised  land   grazing  blocks   provision   young   farmer     "needs   to   bring   Initial  Land   Small   -­‐   5/6   on   10   acres   2/5   under   10   acres,   something   to   the   or  less   2/5  10-­‐30  acres.       Area   party"   Required   Business   Mixed   -­‐   contract   Structure   farming   Tenure   Rented,   many   short   Rented,   many   short   agreements   are   term   with   little   term  with  little  security   security  of  tenure   of  tenure   favourable,   and   partnerships   to   Sources  of  Start-­‐up   Varied,   but   some   Varied,   but   some   help   develop   Finance   personal  finance  is  key.     personal  finance  is  key.     farming   business   CSAs   and   private   Private   investors   provide   investors   appear   to   be   appear   to   be   a   good   opportunities   to   good  options   option,   plus   bank   loans   leverage   debt   if  needed   against   other   Initial   4/6   commenced   with   2/5   commenced   with   people’s  capital   Applicable  to  New  Entrants   an   enterprise   that   was   an   enterprise   that   was   Enterprise   Business   Enables   below   the   threshold   below   the   threshold   Capital   Principles  of  Finance   Size   economies   of   deemed   to   be   deemed   to   be   Development   scale   to   be   commercial   commercial   reached   much   Investment   Investment   reflects   Investment   reflects   more   quickly   tenure   security   tenure   security   and   Priorities   (these   4   are   (greater   security   relatively   low   capital   definitely   in   the   enabled   investment   in   threshold   required   to   biggest   5   assets   that   were   more   enter   the   sheep   enterprises   in   fixed  in  nature)   industry   this  study)   Cost  Control   Second   hand   Fairly   low   cost   Key  Messages   Network,   find   a   equipment,   DIY,   low   production  systems   good   system,   be   capital  production     knowledgeable,   Cash  Flow   Relatively   consistent   Relatively   seasonal   accumulate   cash   flow   (for   farming   cash  flow   capital   and   a   anyway)     Product   proven   track   Secondary   5/6   initially   had   5/5   initially   had   record,   be   good   secondary   secondary  employment   at   negotiating   Employment   employment   and   have   Rare  Breeds   4/6   made   part   or   full   2/5   made   part   or   full   exceptional   use  of  rare  breeds   use  of  rare  breeds     communicative   Direct   5/6   utilised   direct   3/5   utilised   direct   ability.     Also   be   Output   marketing   marketing   excellent   at   Marketing   Marketing   enthusing  others,   Customer   5/6   heavily   engaged   2/5   heavily   engaged   and   telling   them   Relations   with   developing   with   developing   how   great   your   consumer  relations   consumer  relations   business   idea   is.     Media   4/6   used/benefited   2/5   used/benefited   Personal   from   national   media   from   national   media   Coverage   characteristics   coverage   coverage     (labour)   are   very   Niche   6/6  in  Niches   2/5   (although   other   3   significant   in   producers   businesses   determining   the   contained   niche   success   of   a   joint   elements)   venture.         14  
  • 15.   THE  BLUEPRINT  -­‐  LAND  Agricultural  production  is  inherently  linked  to  land  management.    Even  if  large  tracts  of  land  are   not   required   in   order   to   establish   an   agricultural   enterprise,   some   ‘space’   is   still   necessary.    Yet  acquiring  land  is  a  significant  barrier  to  entry  for  new  entrants  (Payne,  2012).    Accordingly,  this  section  will  discuss  possible  solutions  to  some  of  these  challenges.      Principles  of  Land  Use  Applicable  to  New  Entrants  1)  Making  use  of  unwanted  land   “New  entrants  are  using  marginal  land  that  no-­‐one  else  wants  to  farm.”  (Amiss,     2011,  p7)    In  order  to  establish  a  new  farm  enterprise,  young  farmers  may  initially  need  to  make  use  of  land   that   is   currently   under-­‐employed   by   existing   industry   operators.     The   majority   of   the  Group   1(a)   new   entrants   made   use   of   under-­‐utilised   plots25   and   80%   of   Group   1(b)   new  entrants   grew   or   are   growing   their   enterprises   on   relatively   small   parcels   of   often   widely  distributed  land26.    Even   the   most   efficient   farms   are   likely   to   have   a   corner   that   is   under-­‐utilised;   these   are   the  areas   on   which   new   entrants   can   grow   their   businesses,   finding   more   profitable   uses   for  otherwise   unexploited   land   parcels.     Landowners   invariably   embrace   the   additional   revenue  presented   by   utilizing   vacant   plots,   and   established   operators   in   a   given   sector   will   welcome  the   opportunity   to   diversify   income   streams.     There   are   opportunities   for   environmentally  sensitive   farming   in   woodland27   and   many   traditional   farm   buildings   are   incompatible   with  modern  agricultural  machinery  so  consequently  sit  unused28.  While   it   may   seem   counter   intuitive   to   suggest   that   a   new   entrant   who   is   already   at   a  disadvantage  because  of  their  small  size  and  lack  of  capital,  attempt  to  establish  a  business  on  a  sub-­‐optimal   plot   of   land,   it   must   be   remembered   that   there   is   likely   to   be   little   alternative.    Furthermore,  the  proposed  enterprise  needn’t  be  based  on  this  plot  forever;  initially  the  aim  is                                                                                                                  25  Ranging  from  unmanaged  areas  of  woodland  to  unused  farm  buildings  26  For  example,  one  new  entrant  is  taking  on  additional  grazing  60  miles  from  his  base,  and  another  estimates  that  in  the  last  5  years  he  has  spent  1100  hours  driving  to  and  from  his  sheep,  in  the  process  covering  a  distance  equivalent  to  twice  the  circumference  of  the  globe!  27  Pigs  and  poultry  are  obvious  examples,  but  there  is  also  scope  for  silvopasture  enterprises  28  Shifting  economic  pressures  and  agricultural  practices  have  resulted  in  many  traditional  farm  buildings  loosing  their  origincal  purpose  (HELM,  2011)     15  
  • 16.  simply   to   get   the   business   off   the   ground29.     Once   the   business   model   has   been   shown   to   work,  inevitably   more   opportune   plots   of   land   will   become   available,   and   with   a   proven   track   record  landlords  will  be  more  likely  to  consider  allowing  the  enterprise  to  expand  onto  their  property.  2)  Intensity  of  land  use     “[I]t   is   not   the   acreage   you   farm,   but   the   intensity   of   production   you   maintain,     which  determines  the  financial  success  of  the  venture.”  (Henderson,  1943,  p41)    With  land  being  expensive  and  difficult  for  new  entrants  to  source,  production  from  the  area  obtained   should   be   maximised   in   order   to   minimise   costs.     Traditional   economic   theory  suggests  that  capital  increases  returns  from  land  and  labour,  so  the  difficulty  is  in  establishing  a  system  that  produces  maximal  returns  without  incurring  significant  capital  costs.  The   particular   farming   operation   will   dictate   the   way   in   which   production   is   intensified;   a  number  of  the  Group  1(a)  new  entrants  demonstrated  however,  that  increased  output  could  be  obtained   from   a   relatively   small   plot   through   running   a   variety   of   different   enterprises30.    Alternatively   management-­‐intensive   grazing   techniques   are   potentially   well   suited   to   new  entrants31  and  have  been  successfully  employed  by  all  3  dairy  operations  in  Group  2,  and  also  used   to   varying   extents   by   a   number   of   Group   1   new   entrants.     A   common   criticism   of  management-­‐intensive   production   methods   is   the   labour   requirement   involved   in   their  implementation;   the   high   cost   of   land  however,   means   that   such   techniques   can   most   likely   be  justified  in  order  to  minimise  land  related  costs.      3)  How  much  land  is  really  required?     “‘[H]ow   many   acres?’   or   ‘how   many   cows?’   is   largely   irrelevant   as   a   measure   of     success.”  (Amiss,  2011,  p14)    A   number   of   enterprises   included   in   this   study   challenge   perceptions   on   the   amount   of   land  required  to  start  a  farm  business.    Over  60%  of  Group  1  new  entrants  began  their  enterprises  on   10   acres   or   less,   and   fewer   than   20%   started   with   more   than   30   acres.     Some   of   the                                                                                                                  29  This  may  require  something  of  a  culture  shift  in  the  UK,  where  it  has  been  commonly  expected  that  farmers  cultivate  the  same  plot  of  land  for  much  of  their  lives.    However,  in  New  Zealand,  it  is  frequently  seen,  particularly  in  the  dairy  industry,  that  a  farmer  may  have  worked  on  and  had  varying  degrees  of  investment  in  multiple  farms  businesses  throughout  their  lifetime  (Shadbolt  and  Martin,  2005)  30  By  way  of  example,  one  case  study  reared  ducks  for  meat  and  eggs,  geese  for  christmas,  had  a  flock  of  70  sheep,  a  herd  of  20  cows,  some  pigs,  and  ran  a  poultry  processing  facility,  all  on  57  acres.  31  New  entrant  dairy  farmers  in  Wisconsin  were  shown  to  be  far  more  likely  to  employ  management  intensive  grazing  techniques  than  their  established  counterparts  (Buttel,  et  al.,  1999;  Barham,  et  al.,  2001)     16  
  • 17.  enterprises  were  and  continue  to  be  dependent  upon  externally  purchased  inputs,  but  this  in  itself  helps  develop  links  with  the  local  farming  community.    Besides,  it  is  unlikely  that  it  will  initially   be   cost-­‐effective   to   produce   the   limited   inputs   that   are   required   for   a   fledgling  business   as  fixed  costs  are  spread  across  a  relatively  small  output.    The  initial  land  area  will   be  unlikely   to   provide   full   time   employment   for   the   new   entrant,   but   once   the   micro-­‐business   has  proven  itself  to  be  profitable,  expansion  opportunities  are  more  likely  to  become  available.  Tenure  Options  Applicable  to  New  Entrants  Nonetheless,  the  need  for  some  land  remains,  meaning  tenure  options  suited  to  young  farmers  must  be  considered.      Farm   ownership   is   a   long-­‐term   aim   held   by   many   new   entrants32,   and   as   an   aspiration   it   is  adequate;   it   implies   a   long-­‐term   commitment   to   farming,   and   the   significant   equity   growth  required   in   order   to   fund   land   acquisition   is   an   understandable   commercial   aim.     However,  while  land  appreciation  has  been  a  valuable  source  of  asset  growth  in  previous  years,  it  should  be  remembered  that  “[l]and  ownership  has  absolutely  nothing  to  do  with  successful  farming”  (Salatin,   1998,   p46)   and   that   for   a   new   entrant,   sinking   limited   capital   into   land   ownership  represents   a   questionable   investment   from   the   point   of   view   of   establishing   a   farm   enterprise.    While   the   security   of   tenure   benefits   that   accompany   freehold   possession   should   not   be  underestimated,   greater   returns   are   available   when   limited   capital   is   employed   elsewhere.    Thus   it   is   consistent   with   this   theoretical   angle   that   none   of   the   new   entrants   in   this   study  initially  developed  farm  businesses  on  land  that  they  owned  themselves.      1)  Short-­‐term  licenses     “Small  areas  of  land,  let  seasonally,  with  no  security  are  relatively  easy  to  obtain.”     (Blanche,  2011,  p18)    Seasonal   grazing   licenses   and   grass   keep   agreements   offer   young   farmers   a   foothold   in  establishing  a  farming  enterprise.    While  they  provide  no  real  security,  their  inherent  flexibility  is  advantageous  to  a  small  enterprise  growing  and  developing  rapidly  as  it  makes  it  relatively  easy  for  new  opportunities  to  be  taken  should  they  arise.    Furthermore,  while  businesses  are  small   and   investment   stakes   are   relatively   low,   if   need   be   non-­‐fixed   assets   can   be   liquidated  should  the  supply  of  land  discontinue,  with  the  business  being  recommenced  when  additional  land  becomes  available.                                                                                                                  32  LANTRA  (2009)  suggests  that  57%  of  survey  respondents  aspired  to  be  farm  owners  in  the  next  15  years.     17  
  • 18.  Short-­‐term   licenses   are   therefore   important   in   securing   land   for   beginning   enterprises,   with  the   hope   of   later   progressing   onto   plots   that   offer   greater   security   of   tenure.     While   ex-­‐ante  they  may  seem  to  be  of  little  benefit,  they  provide  a  valuable  first  rung  on  the  widely  quoted  ‘farming  ladder’.    The  key  point  is  that  it  is  necessary  to  simultaneously  restrict  investment  to  non-­‐fixed   assets   that   can   be   readily   moved   or   liquidated33,   reflecting   the   non-­‐fixed   nature   of  the  land  tenure.  2)  Tenancies  Although  it  was  suggested  previously  that  agricultural  tenancies  are  difficult  to  secure,  they  are  available   and   should   not   be   ruled   out   by   new   entrants.     By   ensuring   capital   is   not   tied   up   in  land   ownership,   tenancies   offer   increased   business   liquidity   while   providing   greater   security  than   short-­‐term   licenses.     A   number   of   premises   have   recently   been   targeted   specifically   at  new  entrants,  and  county  council  holdings  do,  occasionally,  become  available.    However,  they  are  very  competitive.  For   new   entrants   to   successfully   compete   with   existing   producers   who   have   significant  economies  of  scale  when  applying  for  tenancies,  new  entrants  must  set  themselves  apart  from  the  crowd  of  applicants.  This  begins  to  sound  somewhat  like  the  ‘utopian  rhetoric’  that  it  was  hoped   would   be   avoided,   but   there   cannot   be   a   single   way   to   stand   out   from   the   crowd;   by  definition  it  involves  being  different.    Whether  this  is  through  media  publicity,  innovative  ideas,  irrefutable   operational   excellence   or   any   other   multitude   of   distinguishing   factors   need   not  matter,  but  the  common  theme  is  clear;  through  setting  themselves  apart  from  the  competition,  young  farmers  can  increase  their  likelihood  of  securing  a  tenancy34.  3)  Joint  ventures  -­‐  opportunities     “[T]he   increase   in   unconventional   tenures   which   include   partnerships,   share     farming  and  contract  farming  (collectively  called  joint  ventures)  would  appear   to  offer  new  opportunities  for  those  wishing  to  enter  or  leave  farming.”  (Ingram     and  Kirwan,  2011,  p917)    Joint   ventures   could   equally   be   discussed   in   relation   to   securing   capital,   as   in   many   cases   a  party  may  provide  land  and  a  number  of  capital  assets  to  a  new  entrant  with  which  they  are                                                                                                                  33  Such  as  stock,  electric  fences  and  portable  water  bowsers;  this  explaining  why  short  term  licences  were  demonstrated  to  be  popular  with  sheep  and  pig  producers  in  this  study  34  By  way  of  examples,  one  case  study  who  had  been  struggling  to  secure  a  tenancy  proceeded  to  estabish  their  own  micro-­‐business  on  small  seasonal  lets  in  order  to  develop  a  prooven  track  record  and  business  plan  that  was  supported  by  practical  evidence,  something  which  their  competition  lacked.    Another  case  study  that  successfully  secured  a  tenancy  was  able  to  set  herself  apart  through  her  sheepdog  trialling  success  and  growing  media  attention.     18  
  • 19.  entering   into   a   joint   venture.     However,   it   is   common   for   the   land-­‐owning   partner   to   finance  fixed  assets  that  have  long  repayment  periods,  making  them  similar  to  land  in  their  nature.      For  the  Group  2  case  studies  in  this  paper,  the  joint  venture  into  which  they  entered  was  a  core  part   of   their   enterprise.     Predominantly   entailing   contract-­‐farming   agreements,   they   also  included   partnerships   and   machinery   sharing   arrangements.     The   enterprises   of   three   case  studies  within  Group  1(a)  also  contained  aspects  of  ‘jointness’,  again  including  agreements  that  ranged  from  machinery  sharing  to  divisible  surpluses35.    A   multitude   of   benefits   are   commonly   seen   to   accompany   collaborative   farming   agreements.    For   the   new   entrant,   entering   into   a   joint   venture   provides   expansion   opportunities   from  landlords  who  are  reluctant  to  lease  their  land,  while  also  offering  security  of  tenure  benefits  arising   from   the   landlord   being   given   an   interest   in   the   businesses   long-­‐term   success.     They  provide  a  means  of  achieving  significant  equity  growth36  and  can  offer  opportunities  for  new  entrants  to  leverage  debt  against  a  second  party’s  capital.    For  the  landowning  party  bringing  a  fresh   pair   of   eyes   onto   a   premises   with   the   enthusiasm   to   follow   changes   through   can   be  incredibly   beneficial.     Production   efficiencies   and   economies   of   scale   are   more   likely   to   be  achieved37  and  joint  ventures  offer  phased  retirement  possibilities  for  the  landowner,  allowing  retention  of  property  assets  that  are  appreciating  in  value38.  4)  Joint  ventures  –  practicalities   “Obtaining  the  highest  possible  rent  is  never  the  only  factor,  nor  is  it  advisable  to     be  too  rigid;  flexibility  and  sensible  compromise  are  often  the  hallmarks  of  a  truly   successful  arrangement”  (Nicholas  Ford  cited  in  LandShare,  2012,  p10)    ADAS,  (2007)  lists  6  distinct  types  of  joint  venture  farming,  as  well  as  a  further  ‘other’  category.    Gemmill  (2005)  and  Ingram  and  Kirwan  (2011)  add  to  the  list,  suggesting  joint  venture  limited  companies   and   simple   partnerships   based   on   a   profit-­‐share   agreements   be   included,   thus  illustrating  the  variety  in  the  types  of  joint  ventures  available.    However,  while  the  form  of  the  joint   venture   may   vary,   the   basic   principles   generally   remain   the   same;   one   party   provides                                                                                                                  35  Nonetheless,  they  were  still  included  within  case  study  Group  1  as,  although  beneficial,  the  ‘joint’  aspect  of  their  enterprise  was  not  deemed  to  be  as  influential  in  determining  their  enterprise  establishment.  36  For  example,  one  case  study’s  personal  equity  growth  under  a  partnership  progressed  from  owning  a  7%  share  of  80  cows  in  2005  to  a  50%  share  of  1600  cows  today.  37  As  both  parties  become  strongly  motivated  to  run  the  farming  operation  to  its  full  potential  and  mutual  knowledge  and  skills  sharing  between  the  parties  offers  production  benefits  38  While  also  maximising  financial  benefits  such  as  taxation  advantages  to  the  farm  owner  (DairyCo,  2009,  p1)     19  
  • 20.  most   of   the   capital   requirements,   while   the   other   provides   the   variable   inputs   and  management  in  order  to  achieve  the  production  goals  (Gemmill,  2005).  For   new   entrants   in   the   UK,   the   difficulty   lies   in   encouraging   landowners   to   engage   in   joint  ventures.    An  area  of  concern  is  that  of  risk  and  that  the  stories  of  partnerships  that  circulate  are  of  those  that  have  gone  wrong.    That  said,  there  are  many  instances  where  joint  ventures  have   been   successful   (as   shown   by   the   case   studies   in   this   paper)   and   it   appears   that   they  present   new   entrants   with   opportunities   to   access   land   and   grow   a   farm   business.     The  inherently  human  element  involved  in  their  success39  means  the  specifics  of  the  agreement  will  likely   vary   widely,   but   it   is   evidently   essential   that   parties   initially   clarify   their   objectives;   with  clear   income   and   cost   sharing   agreements,   and   discussion   of   the   issue   of   ‘control’.     It   is   vital  that   the   parties   are   likeminded   and   in   compatible   (often   distinct   from   comparable)  circumstances,  are  up  front  in  stating  their  ultimate  objectives,  and  are  prepared  to  discuss  all  aspects  of  the  agreement  in  question.    That  said,  the  more  complex  the  contract,  the  smaller  the  likelihood  that  a  joint  venture  agreement  will  be  obtained40.      A   prior   association   between   the   parties   is   often   beneficial   and   was   cited   as   being   one   of   the  reasons  why  the  matchmaking  aspect  of  the  Fresh  Start  initiative  was  unsuccessful  (Ilbery,  B.  et  al.,  2009).    All  of  the  case  studies  in  this  report  that  made  use  of  joint  ventures  had  already  developed   a   prior   relationship   with   the   second   party.     While   this   requirement   for   a   previous  connection   may   seem   to   disadvantage   new   entrants,   this   study   has   demonstrated   that   it   is  possible   for   prospective   young   farmers   to   develop   relations   with   established   operators   and  reiterates   the   importance   of   personal   as   well   as   business   characteristics   in   developing   an  agricultural  business.  5)  Re-­‐writing  tenure  agreements     “The   post-­‐feudal   stage   in   England   and   Wales   (exemplified   by   the   era   following     the   1995   Agricultural   Tenancies   Act   and   the   introduction   of   Farm   Business   Tenancies   –   FBTs)   is   described   as   driven   by   a   free   market   orthodoxy,   with   arrangements   brought   about   through   negotiation   rather   than   being   pre-­‐   determined  under  law”  (Ingram  and  Kirwan,  2011,  p919)  The   culmination   of   the   considerable   variation   of   arrangements   under   the   guise   of   ‘joint  ventures’   is   the   opportunity   to   effectively   re-­‐write   traditional   tenure   agreements.     While  inadvisable   without   professional   advice,   there   is   considerable   scope   for   new   entrants   to                                                                                                                  39  With  a  successful  joint  venture  inherently  requring  the  close  cooperation  of  multiple  parties  40  With  the  relative  simplicty  of  single  enterprise  dairying  being  recognised  as  one  of  the  main  reasons  why  uptake  of  partnerships  and  sharemilking  agreements  has  been  so  great  in  the  New  Zealand  dairy  industry.     20  
  • 21.  discuss  alterative  tenure  options  with  landowners  to  fulfill  both  parties’  requirements.    There  were  examples  in  this  study  of  new  entrants  to  whom  land  was  offered  in  partial  lieu  of  wages,  as  well  as  others  who  entered  into  mixed  tenancy/joint  venture  arrangements.  Through   understanding   respective   objectives   parties   can   contract   towards   their   preferred  aims,   selecting   particular   strengths   of   different   models   and   in   effect   creating   a   hybrid  management   contract.     Communication   remains   key;   re-­‐writing   tenure   agreements   can   be  beneficial,   but   the   outcome   must   still   be   clear   and   comprehendible   by   both   parties.     That   there  exists  only  a  limited  amount  of  guidance  in  this  field  needn’t  discourage  young  farmers;  as  the  case  studies  in  this  paper  demonstrate,  unconventional  tenure  agreements  can  be  invaluable  in  helping  new  entrants’  businesses  to  grow.  Stakeholder  Relations  A  number  of  issues  must  be  considered  during  negotiations  with  landlords,  some  of  which  are  discussed  below.  1)  Landlords  and  risk     “Landlords  are  frightened  by  anything  they  perceive  as  risk.”  (  Amiss,  2011,  p26)    Stereotypically,   rural   landlords   are   risk-­‐averse;   agricultural   land   is   considered   to   be   a   stable  investment,   making   it   unattractive   to   purchasers   looking   for   large   risk   and   returns.     Land   is  also   frequently   a   family   asset   and   the   current   owner   will   not   want   to   be   known   as   the  generation  that  lost,  or  degraded,  the  family’s  “crown  jewels”.    Accordingly,  new  entrants  will  need  to  appear  to  be  a  low  risk  option  when  approaching  landlords,  discussed  in  more  detail  below41.  2)  “Over  the     hedge”  relations   “Ultimately   you   can   not   make   people   get   together,   it   is   a   personal   decision.”     (Ingram  and  Kirwan,  2011,  p924)  Landlords   are   motivated   by   factors   other   than   economic   efficiency   when   deciding   upon  management   decisions.     They   care   about   the   ‘health’   of   their   land   and   how   it   is   used.    Accordingly  they  care  about  who  is  using  it.  Aggregating  case  study  Group  1  and  2,  it  can  be  seen  that  80%  of  new  entrants  in  this  study  utilized   pre-­‐existing   contacts   and   networks   they   had   developed   in   order   to   secure   additional                                                                                                                  41  See  p36     21  
  • 22.  land.     News   of   good   land   management   travels,   and   if   a   neighbour   can   see   that   the   grass   is  metaphorically   and   literally   greener   on   the   new   entrant’s   of   the   fence,   then   they   are   more  likely   to   be   interested   in   getting   the   new   entrant’s   input   into   their   own   enterprise.     An  additional   advantage   is   that   local   gossip   is   likely   to   bring   local   contacts,   and   logistically   it   is  easier  to  manage  a  growing  enterprise  that  is  distributed  across  local  sites.  A  fleeting  conversation  ‘over  the  hedge’  can  be  unquestionably  beneficial  in  bringing  space  for  a  business  to  grow.    3)  Size  matters  If  personal  relations  and  networking  play  a  significant  part  in  new  entrants  securing  land,  then  it  would  seem  that  targeting  smaller  landlords  where  it  is  relatively  easy  to  build  relations  with  the  head  of  the  property  would  be  the  most  sensible  approach  for  young  farmers  to  take.    On  smaller  estates  there  is  likely  to  be  less  management  bureaucracy,  making  it  easier  to  influence  landlord  decision-­‐making  and  bring  desirable  changes.    A  minority  of  case  studies  across  both  groups  illustrated  this  point.  However,   to   repeat,   landowners   are   risk   averse.     Greater   success   is   therefore   likely   through  engaging  with  a  larger  landowner  who  is  able  to  offer  a  proportionately  smaller  area  of  their  land  to  a  new  entrant,  thus  reducing  their  personal  risk.  10  of  the  11  case  studies  in  Group  1  suggested   this   was   the   case,   each   operating   on   land   that   constitutes   a   small   proportion   of   a  larger   estate,   and   often   utilising   parcels   of   land   owned   by   different   individuals,   further  spreading  landlord  risk.  Separate   studies   have   shown   that   larger   farms   are   more   likely   to   offer   contract-­‐farming  agreements,   and   that   conventional   and   unconventional   tenancies   are   concentrated   on   larger  farms   (ADAS,   2007;   FiBRE,   2008).     While   the   exception   is   in   relation   to   ‘gentleman’s  agreements’42,   opportunities   for   new   entrants   to   acquire   land   are   more   likely   to   become  available   through   larger   landlords,   and   consequently   young   farmers   should   favour  approaching   them.     It   may   be   more   difficult   to   access   decision-­‐makers   on   such   estates,   but  larger   landlords   ultimately   appear   more   likely   to   bear   the   proportionately   smaller   risks   of  having  a  new  entrant  engage  in  activity  on  part  of  their  land.                                                                                                                  42  33.8%  of  which  were  shown  to  be  on  farms  under  20  hectares  (FiBRE,  2008)     22  
  • 23.   Section  Summary   1. Short-­‐term   licenses   provide   an   invaluable   first   rung,   but   business   liquidity   should   be   matched   to   security   of   tenure.     If   tenure   security   is   low,   then   investment   should   be   prioritised  in  assets  that  can  be  readily  moved  or  liquidated.   2. Land  ownership  is  not  necessary.    Instead  look  to  effectively  increase  security  of  tenure   through  giving  landlords  an  interest  in  the  business.   3. Seek   out   land   that   existing   operators   are   under-­‐utilising.     It   is   cheap   to   acquire   and   finding  a  use  for  it  will  diversify  landowner  portfolios  and  provide  a  new  income  stream.     4. Start  small.    The  ‘250-­‐acre  myth’  (Amiss,  2011)  is  not  required  to  start  a  farm  business.     Take   advantage   of   small   plots   and   maximise   their   productivity.     Developing   a   track   record   and   demonstrating   the   business   is   both   profitable   and   scalable   will   lead   to   larger   plots  becoming  available.   5. Talk   to   landowners.   Listen   to   their   requirements.     Repeatedly   those   who   were   interviewed   suggested   that   they   would   be   prepared   to   engage   with   a   new   entrant   on   their  land.           23  
  • 24.   THE  BLUEPRINT  –  CAPITAL  Every   business,   no   matter   how   small,   needs   some   start-­‐up   capital   (Aubrey,   2007).     For   a  prospective   new   entrant   with   limited   funds,   obtaining   the   capital   required   to   commence   a  farming  enterprise  presents  a  number  of  problems.    This  section  will  discuss  certain  principles  that  young  farmers  can  employ  in  order  to  reduce  the  amount  of  capital  that  they  require,  as  well  as  possible  sources  of  funding.  Principles  of  Finance  Applicable  to  New  Entrants  1)  Great  oaks  and  tiny  acorns     “There  is  a  ‘farming  ladder’  for  all  who  can  make  use  of  it,  but  remember  that  it  is     a   ladder   and   not   an   escalator;   it   must   be   climbed   step   by   step   and   one   must   be   prepared  to  take  the  full  weight  on  each  rung.”  (Henderson,  1943,  p6)    One   interviewee   made   clear   that   the   first   rung   on   the   farming   ladder   is   not   the   mythical  tenancy,  but  instead  is  the  micro-­‐business.    Small,  minimal-­‐capital  enterprises  offer  a  low  risk  training  ground  from  which  to  build  a  larger  farm  enterprise.      Over   half   of   the   Group   1   new   entrants   in   this   study   started   with   a   business   that   was   below   the  threshold   deemed   to   be   ‘economically   viable’43,   while   in   contrast   all   of   the   Group   2   new  entrants   commenced   with   an   enterprise   that   was   significantly   above   this   threshold.     The  common  theme  is  therefore  noticeable;  if  a  new  entrant  is  establishing  a  business  without  the  assistance  of  another  party,  it  is  often  advisable  to  start  small.    It  enables  mistakes  to  be  made  on  a  lesser  scale,  providing  an  incubation  period  in  which  to  test  ideas  and  establish  formulae  that   can   be   incorporated   into   a   larger   business.     Initially   a   lack   of   funds   may   even   be   beneficial  in  controlling  risk  taking  and  preventing  premature  expansion,  but  the  business  will  eventually  require  additional  capital  to  fund  growth.  2)  Degree  of  debt  financing     “Getting   into   too   much   debt   early   on   was   one   of   the   biggest   threats   to   the     beginning  farmers  in  this  study.”  (Barham,  et  al.,  2001,  pii)    While   increasing   personal   equity   in   the   business   makes   it   possible   to   leverage   more   debt  capital   to   finance   expansion,   the   risk   of   failing   on   debt   servicing   repayments   is   higher   if   the  company   is   more   heavily   geared.     The   debt-­‐to-­‐equity   ratio   into   which   a   young   farmer   enters  must  therefore  consider  the  type  of  enterprise  undertaken.                                                                                                                      43  ‘Economically  viable’  is  defined  as  fulfuling  one  of  the  thresholds  given  in  Regulation  (EC)  No  1166/2008  ANNEX  II     24  
  • 25.  Debt  financing  can  be  greater  in  a  business  with  a  higher  turnover44,  as  illustrated  by  some  of  the   dairy   enterprises   in   both   Groups   1(a)   and   2.     In   contrast,   the   relatively   low-­‐input  enterprises   of   Group   1(b)   young   farmers   that   produce   comparably   inconsistent   income  streams  require  lower  cost  structures  in  order  to  maintain  similar  profitability.  3)  Investment  priorities       “Buy  flesh  not  metal”  (Blanche,  2011,  p37)    Savings   from   wages   are   indicative   of   prudent   monetary   management,   but   alone   are   unlikely   to  be  a  source  of  sufficient  capital  accumulation45.    Constrained  by  limited  capital,  it  is  essential  to  invest   in   assets   that   appreciate,   or   at   least   hold   their   value.     Currently   breeding   livestock  appear   to   retain   much   of   their   initial   purchase   price   as   culls,   while   offering   potential   for  income  earning  in  between.    Store  animals  increase  in  value  as  they  grow,  and  salad  crops  are  worth  significantly  more  than  their  seed.    The  dairy  producers  in  Group  2  generally  focussed  their   investment   on   cow   ownership   in   order   to   build   equity46   and   the   majority   of   the   Group  1(b)  producers  employ  low  cost  production  systems  in  order  to  prioritise  investment  in  stock  which  provide  higher  returns  on  capital.      Sources  of  Finance     “When  capital  was  the  chief  constraint,  people  were  incredibly  resourceful  in  its     sourcing  and  deployment.    They  were  not  preoccupied  with  asset  ownership  and   in   many   cases   developed   business   structures   that   either   leveraged   existing     resources  or  employed  other  peoples’  capital.”  (Baird,  2011,  p24)    In  current  markets,  banks  are  reluctant  to  lend  to  borrowers  where  they  consider  there  to  be  significant   risk   and   from   the   point   of   view   of   a   bank,  lending   to   a   young   professional   with   little  track   record,   who   is   looking   to   start   a   farm   business   following   a   period   of   substantial   volatility  in  farm  input  and  output  prices,  represents  a  considerable  risk.    The  perishable  nature  of  many  farming   outputs   adds   to   this   risk47,   thus   while   it   may   be   possible   to   obtain   start   up   finance                                                                                                                  44  Such  as  a  dairy  enterprise  45  To  paraphrase  Shadbolt  and  Martin  (2005,  p271),  saving  $10,000  per  annum,  and  achieveing  a  consistent  real  investment  return  of  8%  [in  itself  questionable]  generates  $456,000  of  equity  after  20  years.    They  also  suggest  that  to  purchase  a  full-­‐time  livestock  farm  [albeit  in  New  Zealand]  requires  $1m  to  $1.5m  of  equity  capital,  providing  an  equity  loan  of  45-­‐50%  is  available.    All  of  a  sudden,  that  $456,000  seems  somewhat  insufficient.  46  To  the  extent  that  one  case  study  questioned  the  logic  behind  purchasing  a  tractor  when  it  was  possible  to  buy  another  30  cows  instead.  47  To  paraphrase  an  interviewee,  rather  than  producing  an  asset  that  can  reside  in  a  warehouse  until  the  market  recovers,  “you  instead  have  a  pig  that  is  getting  over  fat,  costing  money  to  feed  and  house,  and  all  the  while  is  diminishing  in  value”.     25  
  • 26.  from   a   bank,   the   chance   of   doing   so   at   an   affordable   interest   rate   is   fairly   slim,   making   it  necessary  to  explore  alternative  sources  of  finance.  1)  Grants  Grants  are  available  to  young  farmers  from  a  range  of  different  sources.    A  minority  of  the  case  studies  across  Group  1  made  use  of  start-­‐up  grants,  ranging  from  funding  to  promote  local  food  initiatives,  to  others  geared  towards  business  start-­‐up.    However,  although  all  the  individuals  recognised  that  the  grants  had  been  useful  in  helping  their  businesses  to  grow,  few  suggested  that  the  grant  funding  had  been  a  critical  factor  in  furthering  their  enterprise,  indicating  that  such   grant   funding,   although   beneficial,   in   isolation   is   not   sufficient   to   build   a   viable  agricultural  enterprise  and  that  alternative  sources  of  financing  are  also  required.  2)  Private  investment     “If  those  with  capital  see  there  is  a  yield  to  be  had  and  they  trust  you;  if  they  see     you   as   a   money   making   machine,   capital   is   obtainable.     It   relies   on   making   contacts,  proving  yourself  and  selling  yourself.”  (Blanche,  2011,  p40)    Evidently  a  new  entrant’s  desire  to  succeed  makes  an  enormous  difference  in  determining  the  success   of   a   farming   operation,   and   passion   is   perhaps   best   conveyed   to   private   individuals  outside   a   corporate   setting.     It   is   difficult   to   build   a   relationship   with   a   bank   manager   with  whom   you   are   not   yet   a   customer,   while   it   is   far   easier   to   discuss   a   new   farm   business  proposition   with   a   friend,   family   member   or   acquaintance.     This   imperfect   informational  relationship   between   new   entrants   and   corporate   sources   of   finance   is   evidenced   by   the   fact  that   many   of   the   individuals   in   this   study   initially   financed  aspects   of   their   businesses   through  private  sources  of  investment,  particularly  in  Group  2  where  the  capital  threshold  required  to  engage   in   joint   ventures   was   high.     Private   individuals   appear   predisposed   to   consider   the  pivotal   human   factors   that   determine   the   success   of   a   new   farming   operation,   meaning   that  young   farmers   are   likely   to   be   more   fruitful   in   securing   finance   when   pursuing   private   sources  of  investment.  3)  Community  supported  agriculture  (CSA)     “CSA’s   are   an   option   for   funding   working   capital   and   a   guarantee   of   customer     support.”  (Amiss,  2011,  p7)  Developing   the   previous   section   on   private   investment,   certain   CSA   initiatives   effectively  replicate   a   corporate   shareholder   model;   with   investment   from   private   individuals   used   to  finance   an   agricultural   enterprise.     A   number   of   initiatives   exist   under   the   CSA   banner,  including   producer-­‐led   subscriptions,   community-­‐led   co-­‐operatives,   producer-­‐community     26  
  • 27.  partnerships  and  community-­‐owned  farms  (Soil  Association,  2011).    A  range  of  definitions  of  CSAs  are  in  circulation48,  but  from  a  new  entrant’s  perspective  the  key  point  is  that  of  reducing  personal  risk  by  encouraging  community  investment  in  a  farming  enterprise  and  strengthening  customer  support.  The   specifics   of   a   young   farmer’s   CSA   initiative   may   vary.     For   example,   Charlotte   and   Ben  Hollins   created   England’s   first   community   owned   farm   through   establishing   Fordhall  Community   Land   Initiative,   and   in   doing   so   were   able   to   provide   themselves   with   an  opportunity   to   obtain   a   tenancy.     Another   case   study   utilised   a   producer   led   subscription  framework  in  establishing  a  vegetable  box  scheme  and  a  further  individual  broadly  made  use  of   CSA   principles   through   the   sale   of   ‘cow   bonds’49;   providing   community   investors   with   a  return  and  enabling  the  initial  partnership  to  purchase  required  working  capital.    Essential  to  success  in  all  cases  has  been  communication  between  the  farmers  and  investors,  however  CSAs  offer  ambitious  and  proactive  young  farmers  with  the  capacity  to  engage  with  the  community  an  opportunity  to  access  non-­‐traditional  sources  of  capital  and  develop  customer  loyalty.  4)  “Only  your  imagination  limits  the  capital  you  can  get”  (Macher,  1999,  p21)  This  again  verges  on  the  utopian  rhetoric,  but  the  above  examples  illustrate  the  varied  means  by   which   it   is   possible   to   finance   a   farming   operation.     While   a   new   entrant   is   unlikely   to  succeed   in   loan   applications   if   there   are   doubts   over   practical   skills,   financial   management  abilities   or   their   character   (Shadbolt   and   Martin,   2005),   to   quote   Baird   (2011,   p29)   “if   other  elements  of  a  business  case  are  compelling  enough,  capital,  from  whatever  source  should  not  be  a  show  stopper”.                                                                                                                  48  Although  the  Soil  Association  (2011,  p1)  recently  defined  CSA  as  meaning  “any  food,  fuel  or  fibre  producing  initiative  where  the  community  shares  the  risks  and  rewards  of  production,  whether  through  ownership,  investment,  sharing  the  costs  of  production,  or  provision  of  labour”.  49  A  ‘cow  bond’  being  a  fixed  term  investment  of  3  years  with  a  5%  rate  of  return  per  year     27  
  • 28.   Section  Summary   1. Personal   savings   will   be   required.     Personal   investment   reinforces   commitment   to   the   business   and   the   prudent   financial   management   required   to   accumulate   savings   is   attractive  to  prospective  investors.   2. Leverage   the   business   in   accordance   with   the   enterprise   profitability   and   cash   flow.     Focus  investment  on  assets  that  hold  their  value  and  are  capable  of  generating  a  return.   3. Imperfect   informational   relationships   in   corporate   settings   mean   private   investors   are   likely  to  be  a  more  fruitful  source  of  funding.   4. CSA  initiatives  offer  young  farmers  with  the  capacity  to  engage  with  the  community  an   opportunity  to  access  non-­‐traditional  sources  of  capital  and  develop  customer  loyalty.     28  
  • 29.   THE  BLUEPRINT  –  OUTPUT  The  purpose  of  this  discussion  is  not  to  find  a  single  agricultural  output  that  all  new  entrants  should  focus  on  producing.    The  range  of  enterprises  undertaken  by  new  entrants  in  this  study  is  evidence  of  the  fact  that  there  is  no  ‘best’  product  young  farmers  should  market.    That  said,  there   are   a   number   of   common   features   running   though   many   of   the   case   studies   in   this   paper  in   relation   to   the   target   market,   the   marketing   strategy   and   the   enterprise   output,   that   are  worthy  of  further  discussion.    The  Market  1)  Niches     “The  aging  farm  population  is  creating  cavernous  niches  begging  to  be  filled  by     creative  visionaries  who  will  go  in  dynamic  new  directions.”  (Salatin,  1998,  px)    Niche  markets  involve  product  differentiation,  which  increases  heterogeneity,  allows  non-­‐price  competition,   and   in   turn   enables   businesses   to   make   the   supra-­‐normal   profits   that   facilitate  significant   reinvestment   and   growth.     Particularly   important   to   Group   1   new   entrants,   over  70%   of   the   farmers   within   this   category   exploited   niche   markets   in   order   to   develop   their  initial   enterprise,   and   the   remaining   businesses   in   this   group   generally   contained   subsidiary  niche   elements.     Through   marketing   niche   products,   young   farmers   are   able   to   command  premium   prices   and   insulate   themselves   from   direct   competition,   protecting   their   fledgling  businesses  and  providing  a  secure  environment  in  which  to  grow.  2)  “Adapt,  innovate,  overcome”  (Baird,  2011,  p22)     “The  hardest  thing  to  change  on  a  farm  is  the  mindset  of  the  farmer!    Cows  adapt!       Pastures   adapt!   To   flourish   in   turbulent   times   the   farmer   needs   to   be   adaptable!”   (Kuriger,  cited  in  Williams,  2011,  p27)    While  large  producers  have  significant  economies  of  scale,  to  reach  this  position  they  will  have  invested   heavily   in   a   given   form   of   production.     Consequently   they   will   find   it   comparatively  difficult   to   adjust   business   direction   if   market   conditions   change.     In   contrast,   a   small   business  can   relatively   simply   restructure   in   order   to   pursue   new   production   goals,   with   this  representing   a   comparative   advantage   that   must   be   utilised   by   young   farmers.     Here   the  theoretical  framework  is  best  illustrated  though  brief  mention  of  two  specific  case  studies.    One  began   his   farming   enterprise   producing   organic   veal   from   a   suckler   herd,   but   in   light   of  increased  competition  completely  restructured  his  business  and  began  producing  sheep.    The  other   had   already   grown   a   pig   enterprise   when   increased   feed   costs   reduced   business  profitability.     He   took   a   step   back,   re-­‐evaluated   his   system   and   was   able   to   implement   changes     29  
  • 30.  that  increased  pig  productivity  and  brought  him  back  into  the  black.    Both  individuals  highlight  that   successful   new   entrants   must   be   able   to   evaluate   their   business   objectively,   reiterating  how  the  speculative  model  is  supported  by  grass  roots  evidence  in  this  study.    The  innovative  ability   of   young   farmers   is   highlighted   in   existing   literature   as   being   one   of   their   key  advantages   (Shadbolt   and   Martin,   2005;   Owen,   2009),   and   so   is   something   that   successful   new  entrants  must  exploit.  The  Marketing     “Traditional   agriculture,   as   they   say,   is   the   only   business   in   the   world   that   buys     retail,  sells  wholesale,  and  pays  the  freight  both  ways.”  (Macher,  1999,  p219)  Many  of  the  Group  1  case  studies  in  this  paper  engaged  in  direct  marketing50.    This  trend  was  most   pronounced   amongst   the   Group   1(a)   young   farmers,   where   5   out   of   the   6   interviewees  engaged   in   direct   marketing.     Ceteris   paribus,   reducing   distribution   chains   results   in   increased  producer   profitability,   in   turn   enabling   increased   reinvestment   and   business   growth.    Furthermore,  while  ‘adding  value’  is  technically  about  the  product  rather  than  the  marketing  strategy,  it  comes  hand-­‐in-­‐hand  with  direct  marketing;  again  offering  increased  gross  income  and  net  profit,  provided  additional  costs  are  controlled.      Successful   direct   marketing   is   intertwined   with   developing   customer   relations.     Through  making   use   of   social   media   and   personal   websites,   new   entrants   are   able   to   foster   positive  customer   relations,   building   brand   loyalty   while   educating   the   public   about   farming   best  practice.     A   selection   of   Group   1   case   studies   promote   their   respective   brands   through   social  networking  sites,  while  additional  case  studies  engage  with  consumers  at  farmers  markets  and  on   delivery   rounds.     Increased   consumer   loyalty   reduces   sensitivity   to   price   changes   and  ultimately  allows  producers  to  be  in  position  where,  as  one  new  entrant  explained,  customers  “not  only  buy  the  produce,  but  also  a  bit  of  your  life”.    For  many  new  entrants,  the  success  of  their  farm  business  was  not  just  down  to  the  fact  that  they  were  technically  efficient  producers;  often   activities   beyond   the   farm   gate   were   of   equal   importance   in   helping   their   businesses  flourish.  In  light  of  the  importance  of  direct  marketing  and  proactively  developing  customer  relations,  it  is   unsurprising   that   many   new   entrants   in   this   study   successfully   utilised   media   coverage.    Particularly  significant  for  Group  1  young  farmers,  more  than  half  of  the  new  entrants  in  this  group   have   made   use   of   national   media   publicity.     Perhaps   most   significantly,   Charlotte   and                                                                                                                  50  be  it  through  on  farm  sales,  delivery  services,  farmers  markets  or  farm  shops,  often  utilising  more  than  one  of  the  above     30  
  • 31.  Ben   Hollins   managed   to   raise   much   of   the   £800,000   required   to   secure   Fordhall   Farm   through  their  extensive  media  campaign,  simultaneously  painting  a  favourable  image  of  farming  to  the  wider  public.      It   might   be   suggested   that   the   selection   procedure   used   to   obtain   case   studies   for   the   report  meant   that   there   was   a   selection   bias   towards   interviewing   highly   publicised   new   entrants.    However,   the   evidence   presented   here   ultimately   suggests   that   for   Group   1   new   entrants,  engaging   in   direct   marketing   and   developing   customer   relations   is   essential,   so   it   is   directly  compatible  with  this  theoretical  framework  that  a  significant  majority  of  young  farmers  have  successfully  utilised  media  coverage  in  order  to  achieve  these  objectives.  The  Product  1)  Cash  flow     “By   far   and   away   the   most   significant   obstacle   to   entry   reported   by   the   entry     survey   respondents   was   being   able   to   maintain   an   adequate   cash   flow   during   the   first  few  years.”  (Buttel,  et  al.,  1999,  p9)  Businesses  require  cash  flow  in  order  to  remain  in  operation,  however  the  seasonal  nature  of  agricultural   production   is   not   conducive   to   maintaining   a   consistent   income   stream.     This  presents   problems   for   new   entrants   who   have   taken   on   debts   that   require   regular   servicing  and  who  need  to  purchase  farm  inputs,  thus  making  it  important  to  select  an  enterprise  that  provides  a  consistent  cash  flow.  The   Group   1(a)   enterprises   in   this   study   illustrate   this   point,   all   of   them   offering   products   that  are   comparatively   unaffected   by   seasonal   fluctuations51.     The   relatively   consistent   income  streams  provided  by  dairy  businesses  are  beneficial  in  this  regard,  in  part  explaining  why  dairy  enterprises   were   popular   amongst   Group   2   new   entrants   who   could   overcome   the   high   capital  threshold  required  to  enter  this  sector.    In  contrast,  in  the  absence  of  consistent  cash  flow,  the  enterprise   selected   must   have   low   cost   requirements,   as   illustrated   by   the   Group   1(b)   new  entrants  in  this  study  who  were  predominantly  focused  on  sheep  production.                                                                                                                      51  Although  it  should  be  explicitly  stated  that  this  does  not  mean  that  they  are  exempt  from  the  vagaries  of  of  the  seasons.     31  
  • 32.  2)  Part  time     “It   is   often   necessary   to   live   on   other   savings   or   other   sources   of   income   in   the   early   stages   of   a   new   business.   Remember,   the   owner   gets   paid   last.”   (CFBMC,     1999,  p6)  It   is   unlikely   that   the   proposed   fledgling   enterprise   will   initially   generate   sufficient   profits   to  enable  a  significant  wage  to  be  drawn  from  the  business.    Consequently  the  initial  enterprise  must   have   a   flexible   time   requirement   that   allows   income   to   be   maintained   from   alternative  employment.     Illustrating   this   point,   over   90%   of   the   Group   1   young   farmers   had   primary  employment  elsewhere  while  their  own  farm  business  was  growing52.    It  is  effectively  a  given  that   a   new   entrant   will   have   to   maintain   an   additional   income   stream   in   the   early   stages   of  business  establishment,  and  the  time  commitment  the  initial  enterprise  requires  must  reflect  this.  3)  Rare  breeds  Rare   breeds   present   young   farmers   with   a   number   of   advantages   beyond   their   suitability   to  niche   marketing;   not   least   that   their   alleged   greater   hardiness   reduces   the   time   input   involved  in   their   management   and   their   infrastructural   requirements.     While   it’s   hoped   a   new   entrant  will  be  technically  proficient  in  the  enterprise  undertaken,  rare  and  heritage  varieties  may  be  more  forgiving  of  possible  mistakes  and  the  quality  associated  with  their  produce  is  well  suited  to  direct  sales  and  niche  marketing.    Additionally  the  recent  media  coverage  rare  breeds  have  received  means  that  part  of  the  marketing  of  their  products  has  already  been  completed.  Approximately   half   of   Group   1   new   entrants   in   this   study   utilised   rare   breeds   in   their   initial  enterprise,   however   even   across   these   enterprises   the   focus   on   rare   breeds   varied.    Consequently   it   is   difficult   to   conclude   that   there   is   an   unambiguous   trend   among   successful  new   entrants   to   use   heritage   varieties.     Nevertheless,   the   relationship   between   using   rare-­‐breeds  and  directly  marketing  produce  is  strong,  and  is  indicative  of  the  symbiosis  of  these  two  variables.                                                                                                                  52  Notable  examples  included  one  individual  who  maintains  3  separate  income  streams,  and  another  who  had  established  an  800  ewe  flock  which  in  2010  on  average  required  a  mere  29-­‐hour  week  to  run,  providing  free  time  for  allocation  elsewhere.         32  
  • 33.   Section  Summary   1. Niche   markets   offer   a   protected   environment   in   which   to   establish   a   fledging   farm   enterprise   by   shielding   new   entrants   from   mainstream   competition.     Utilised   alongside   principles   of   direct   marketing   and   added   value   they   can   optimise   business   profitability.       2. Developing  customer  relations  and  brand  loyalty  are  essential.    Many  new  entrants   have  made  the  most  of  media  coverage  in  order  to  promote  their  businesses.       3. Products  offering  consistent  cash  flow  opportunities  are  favourable,  particularly  for   new  entrants  with  debt  repayment  obligations.     4. A   secondary   income   source   may   initially   be   required.     The   enterprise’s   labour   requirement  should  reflect  this,  only  requiring  a  part-­‐time  commitment  in  the  early   stages.     33  
  • 34.   THE  BLUEPRINT  –  LABOUR  A   number   of   common   variables   are   apparent   among   the   case   studies   included   in   this   study  aside  from  the  characteristics  of  their  businesses.    Many  of  the  issues  discussed  in  the  following  section   are   incredibly   subjective   and   therefore   are   not   predisposed   to   inclusion   within   the  strict  confines  of  a  ‘blueprint’.    That  said,  failing  to  mention  them  would  have  meant  neglecting  a   considerable   issue;   namely   that   the   personal   characteristics   of   a   new   entrant   are   highly  significant  in  determining  their  success.  Motivation  1)  Purpose     “I  accept  that  not  everyone  is  monetarily  driven,  but  it  distorts  normal  economic   forces,  and  does  a  disservice  to  other  more  progressively  minded  businesses,  when     decision  making  is  not  based  on  sound  business  rationale.”  (Baird,  2011,  p28)  Is  farming  a  ‘way  of  life’?    Allot  of  the  new  entrants  interviewed  for  this  study  cited  the  lifestyle  farming   offered   as   being   an   attraction   that   drew   them   to   the   profession.     However,   as   Baird  (2011)  makes  clear,  the  term  ‘way  of  life’  should  not  be  “used  to  justify  a  sub-­‐standard  business  mindset”,   especially   in   the   early   stages   when   business   growth   is   required.     Regardless   of  whether   lifestyle   considerations   may   be   motivational   factors,   while   the   odds   are   stacked  against   success   the   business   model   must   be   profit   focused.     Illustrating   this   point,   a   number   of  the   new   entrants   across   both   groups   in   this   study,   commenced   in   building   enterprises   in  sectors  that  were  not  their  initial  preference,  recognising  greater  opportunities  in  other  areas.      The   challenges   of   agricultural   production53   mean   that   “tenacity…   or   just   bloody   mindedness”54  is   a   likely   prerequisite   to   success.     If   it   helps   explain   motivational   factors,   farming   can   be   an  “emotion”  or  a  “calling”  (Blanche,  2011),  but  in  order  to  develop  a  successful  enterprise  focus  must  remain  first  and  foremost  on  business  profitability.  2)  Ambition     “Ambition   is   energy   and   determination   rolled   into   one.     People   are   either   born     with  ambition  or  not.”    (Williams,  2011,  p30)  Many   established   land   owning   farm   businesses   are   able   to   include   land   appreciation   in   their  bottom  line.    For  a  non-­‐land  owning  new  entrant  where  returns  from  production  are  the  single  factor   contributing   towards   profitability,   production   profits   must   not   only   match   but   also                                                                                                                  53  Including,  but  not  limited  to,  the  vagaries  of  the  weather,  livestock  production,  disease  risks  and  complex  regulations  54  Quoting  one  of  the  case  studies  interviewed  in  this  study     34  
  • 35.  exceed   those   of   an   established   operator55   in   order   to   fund   business   growth.     This   presents  something  of  a  challenge.  “Don’t   be   a   farmer   like   everyone   else”   said   one   case   study.     For   another   “operational  excellence”   and   “top   5%”   are   practically   catchphrases.     There   are   highly   skilled   farmers  struggling   to   make   ends   meet.     In   order   to   not   only   make   ends   meet,   but   also   grow   a   business,  operational  excellence  -­‐  or  at  least  aspirations  of  it  -­‐  is  essential.      All   successful   new   entrants   are   ambitious;   after   all   there   are   easier   ways   to   make   a   living   in  agriculture   than   starting   a   new   farm   business,   and   there   are   easier   industries   in   which   to   start  a   new   business   than   farming.     Thus,   for   someone   to   be   seriously   contemplating   establishing  their  own  agricultural  enterprise,  it  must  be  taken  as  a  given  that  they  are  passionate  about  the  subject,  committed  to  the  cause  and  incredibly  driven,  (or  at  least  sufficiently  resilient,)  to  be  able  to  make  it  a  success.  It  is  hoped  that  this  final  point  lifts  this  issue  back  out  of  the  utopian  rhetoric.    That  everyone  interviewed   in   this   study   was   ambitious   was   an   obvious   common   factor   that   could   not   be  excluded.     The   problem   with   a   less   tangible   factor   such   as   ‘motivation’,   is   that   in   this   context   it  is   difficult   to   effectively   quantify.     However,   by   considering   an   ambitious   personality   to   be  prerequisite   when   embarking   upon   establishing   an   agricultural   enterprise,   perhaps   it   can   be  deemed  a  common  foundation  stone  in  determining  a  new  entrant’s  success.      Business  Skills  1)  Goal  setting     “If   you   don’t   know   where   you   are   going,   how   will   you   know   when   you   get   there?”     (Macher,  1999,  p233)  Most   successful   new   entrants   could   clearly   articulate   their   aspirations   for   the   future.     Goals  were   anything   from   general   concepts   to   measurable   targets,   but   in   all   cases   helped   keep   the  business  on  track  and  prevent  investment  in  unnecessary  side-­‐lines.    This  is  not  to  suggest  that  driven   new   entrants   loose   track   of   the   day-­‐to-­‐day   enjoyment   of   running   their   farming  enterprise,  simply  that  they  remain  focussed  on  longer-­‐term  objectives  and  seek  to  avoid  being  distracted  from  eventual  business  goals.                                                                                                                  55  Who  also  has  considerable  economies  of  scale     35  
  • 36.  2)  The  risk  dichotomy     “Unless   they   are   of   exceptional   ability   new   entrants   are   regarded   as   carrying     greater  risk”  (TFF,  2008,  p9)  The   risk   taking   ability   of   young   farmers   is   cited   as   being   one   of   their   key   advantages   (Shadbolt  and  Martin,  2005;  Owen,  2009),  yet  at  the  same  time,  a  new  entrant  needs  to  demonstrate  to  landowners   and   investors   that   they   are   not   a   high-­‐risk   proposition.       This   represents  something  of  a  dichotomy,  but  has  a  relatively  straightforward  solution;  to  overcome  perceived  risk,  a  young  farmer  must  be  exceptionally  skilled.    There  is  no  escaping  the  need  for  practical  competence   in   establishing   a   farming   enterprise,   and   ‘operational   excellence’   is   likely   to  require  more  than  mere  ‘competence’.      3)  Practical  expertise     “[I]f   you   don’t   know   your   meat,   make   sure   you   know   your   butcher   really   well”     (Murphy,  Cited  in  Baird,     011,  p48)   2The   Group   2   interviewees   particularly   articulated   the   importance   of   acquiring   relevant  experience   before   embarking   upon   their   own   business,   and   have   evidently   done   this  themselves.     All   Group   2   new   entrants   in   this   study   had   completed   higher   education   in  agriculture  or  a  related  subject,  and  all  had  spent  a  period  of  time  working  overseas  furthering  their  skills.    In  advancing  their  knowledge  base  they  developed  their  credibility,  and  ultimately  ensured  they  appeared  a  low  risk  investment  when  joint  venture  opportunities  arose.  A   number   of   the   Group   1   new   entrants   reiterated   the   importance   of   developing   practical   skills  prior   to   business   establishment.     It   was   explained   how   an   initial   period   working   for   other  people   was   invaluable   to   enable   knowledge   acquisition   in   an   environment   where   others   can  compensate  for  mistakes.    Blanche  (2011)  remarks  that  such  expertise  can  be  “free,  cheap  or  even  cash  positive”  to  develop,  and  through  undertaking  a  range  of  different  work  experience  and  employment  placements,  new  entrants  can  readily  acquire  necessary  skills.    By  going  out  of   their   way   to   acquire   these   skills,   new   entrants   can   reduce   perceptions   of   risk   towards   them,  placing  them  in  a  stronger  position  when  embarking  upon  their  own  enterprise.  4)  Communication     “The  more  people  you  know  and  the  more  people  that  know  you  -­‐  the  more     opportunity.  It’s  a  direct  correlation.”  (Blanche,  2011,  p52)  Networking  ability  and  people  management  skills  are  essential  in  starting  any  business,  as  is  the   capacity   to   articulate   aspirations   and   objectives.     In   a   rural   community   where   by   definition     36  
  • 37.  there   is   greater   isolation,   new   entrants   must   be   able   to   engage   with   those   around   them.  Communicative   abilities   are   essential   in   generating   opportunities   to   access   land   and   capital,  and  are  also  pivotal  in  developing  customer  support  and  business  relations.  Passion,   ambition,   business   acumen   and   commitment   are   prerequisite   skills   to   establishing   a  successful  farm  business,  but  they  are  far  more  effective  if  they  can  be  conveyed  to  others.    It  could  be  a  flaw  in  the  selection  procedure  utilised  to  obtain  case  studies  for  this  evaluation,  but  all  those  interviewed  in  this  study  were  able  to  clearly  explain  their  stories  and  convey  their  passion  for  their  respective  businesses.      5)  Commercial  acumen     “99%  of  the  money  you  make  from  farming  comes  from  the  top  3  inches  of  your     body.”  (Blanche,  2011,  p53)  Inevitably  there  is  more  to  establishing  a  business  than  communication,  goal  setting  and  taking  risks.     Successful   young   farmers   in   this   study   were   adept   at   creating   and   acting   upon  opportunities.     They   were   able   to   re-­‐evaluate   and   restructure   their   respective   enterprises  when   required,   and   were   not   afraid   of   acknowledging   strengths   and   weaknesses   of   their  businesses.     Many   of   them   were   confident   in   their   capabilities   while   being   able   to   recognise  current  limitations,  were  professional  in  their  nature  and  had  a  positive  mindset.    As   one   interviewee   stated,   successful   new   entrants   “have   some   oomph   about   them”;  encapsulating  the  constellation  of  personal  characteristics  including  intangible  factors  such  as  being  driven,  sharp  and  dedicated,  that  promote  business  establishment  in  agriculture.   Section  Summary   1. Following  the  principles  successfully  utilised  by  previous  industry  participants  can  make   you  an  actor,  but  it  is  ultimately  personal  character  traits  that  will  make  you  the  George   Clooney   of   the   farming   fraternity.     While   chiselled   good   looks   probably   aren’t   prerequisite   in   furthering   an   agricultural   career,   hard   work,   charisma,   drive   and   the   ability  to  stand  out  from  the  competition  are.       2. Practical   and   business   skills   are   significant   in   promoting   the   achievements   of   new   entrants,   but   ambition,   communicative   ability   and   a   hunger   for   further   knowledge   are   most  likely  more  important  factors  in  ensuring  eventual  success.       37  
  • 38.   CONCLUSIONS     ”Never  let  any  young  man  [or  woman!]  say  there  are  no  opportunities  in  farming.       They  are  there  all  right,  but  mostly  disguised  as  hard  work.”  (Henderson,  1943,   p.290)    The   evidence   collated   in   this   study   suggests   there   are   two   primary   means   by   which   new  entrants  can  establish  their  own  farming  business,  detailed  below.    Blueprint  1  –  the  part  time  micro-­‐business  Young   farmers   may   develop   a   farming   enterprise   through   creating   a   part-­‐time   fledgling  business.    Small56,  niche,  low-­‐capital  enterprises,  commonly  utilising  rare  or  heritage  breeds  on  under-­‐utilised  areas  of  land,  enable  new  entrants  to  develop  their  business  skills.      Low-­‐capital   fledgling   businesses   by   definition   have   a   low   funding   threshold   however   if  external  funding  is  required,  CSA  principles  provide  a  means  of  securing  funds  and  customer  support.     Once   a   viable   business   plan   has   been   demonstrated,   investment   can   be   mobilised  through  effective  promotion  to  private  investors  that  are  able  to  consider  the  personal  factors  that  contribute  towards  successful  farm  business  establishment,  and  grant  funding  may  also  be  available  for  selected  enterprises.      Short-­‐term   licences   initially   enable   new   entrants   to   access   land,   before   later   seeking   to  increase   security   of   tenure   through   longer-­‐term   lease   agreements.     As   such   agreements   can   be  difficult   to   obtain,   a   preferable   solution   may   be   to   effectively   increase   security   of   tenure   by  giving  the  landlord  an  interest  in  the  business57,  in  doing  so  providing  them  with  motivation  to  support  the  longer  term  success  of  the  enterprise.      It   is   possible   to   select   a   number   of   agricultural   sectors   best   suited   to   new   entrants.     Many  existing   arable   and   vegetable   enterprises   boast   significant   economies   of   scale,   utilise   capital-­‐intensive   machinery   and   cover   large   areas   of   ‘prime’58   agricultural   land.     These   factors   make  the  sectors  poorly  suited  to  prospective  new  entrants.    While  contracting  opportunities  may  be  available,   new   entrants   will   be   in   direct   competition   with   existing   producers   who   have   more  efficient  cost  structures,  and  such  work  will  often  be  seasonal  in  nature  therefore  offering  an  inconsistent  income  stream.                                                                                                                  56  Often  initially  below  the  size  deemed  to  be  ‘commercial’  holding  by  DEFRA  (2010)  57  Perhaps  through  a  profit  sharing  agreement,  or  a  synergy  with  another  aspect  of  the  landlord’s  enterprise  58  read  ‘expensive’     38  
  • 39.  Cattle   present   comparable   problems;   their   purchase   and   infrastructural   requirements  necessitating   substantial   capital   investment.     Suckler   cows   pose   cash   flow   difficulties59,   and  while  dairy  cattle  may  be  better  in  this  regard,  their  infrastructural  needs  are  even  greater.    For  this   reason   dairy   sheep   and   goats   may   be   preferable,   with   both   their   respective   milk   and  cheeses  being  well  suited  to  niche  marketing  campaigns.      Outdoor   pigs   and   poultry   both   offer   opportunities   for   relatively   consistent   cash   flow  enterprises  while  requiring  reduced  initial  capital  investment.    Similarly  sheep  enterprises  also  have  lower  capital  requirements,  although  their  income  stream  is  likely  to  be  less  consistent.    However,   their   seasonal   labour   commitment   may   be   suited   to   a   new   entrant   engaged   in  similarly   seasonal   employment   elsewhere,   and   their   low   infrastructural   requirements   are  beneficial  to  new  entrants  with  restricted  start-­‐up  capital.      This   argument   assumes   alternative   enterprises   are   directly   substitutable,   but   in   reality   this  may  not  be  the  case;  geographical  location,  sectorial  knowledge  and  a  host  of  other  factors  may  ultimately   dictate   enterprise   selection.     There   are   also   additional   business   options   that   have  not  been  considered,  and  there  are  new  entrants  in  this  study  engaged  in  building  businesses  in  sectors  that  the  above  discussion  would  imply  are  suboptimal.    However,  as  was  said  at  the  start,  the  aim  of  this  study  was  not  to  find  a  single  best  solution,  it  was  instead  to  look  at  the  variables   that   promote   a   new   entrant’s   success.     In   this   area,   these   variables   appear   to   be  finding  a  niche,  developing  customer  relations  through  direct  marketing  and  media  campaigns,  starting   on   a   part-­‐time   basis   within   a   low-­‐capital   enterprise   and   often   utilising   non-­‐mainstream   breeds.     Relevant   practical   experience   in   the   enterprise   to   be   undertaken   is   also  important,  but  it  should  be  noted  (although  not  advised!)  that  a  number  of  new  entrants  in  this  study   commenced   upon   establishing   a   micro-­‐business   in   a   sector   in   which   they   initially   had  limited  direct  experience.  In  the  long  term  it  will  be  necessary  to  produce  a  business  model  that  is  scalable.    While  the  aims  of  the  operator  may  ultimately  determine  the  eventual  business  size,  all  the  case  studies  in   this   report   had   aspirations   of   the   enterprise   undertaken   being   able   to   provide   full   time  employment   for   at   least   the   primary   operator,   if   they   weren’t   at   this   point   already.     It   is                                                                                                                  59  A  suckler  cow,  which  costs  £1000  and  likely  takes  a  year  to  produce  a  single  calf  that  requires  a  further  2  years  of  growth  before  being  marketable  as  beef,  and  in  between  demands  costly  inputs  is  not  conducive  to  promoting  cash  flow.    That  said,  a  case  study  in  this  paper  is  engaged  in  developing  a  suckler  operation,  however  cited  cash  flow  as  being  an  issue,  with  “dead  money”  being  tied  up  in  breeding  and  young  stock.     39  
  • 40.  possible  to  develop  a  business  of  considerable  scale  through  this  route60,  but  it  takes  time  and  appears  to  require  persistent  and  steady  growth.      Blueprint  2  –  the  joint  venture  A   second   means   by   which   a   new   entrant   can   develop   a   farm   enterprise   is   through   initially  engaging  in  a  joint  venture  with  an  established  operator.    Shadbolt   and   Martin   (2005)   suggest   that   joint   ventures   are   well   suited   to   the   dairy   industry.    The  ‘tie’  of  milking  cows  twice  a  day  requires  enthusiasm  and  energy,  perhaps  best  offered  by  a  new   entrant   and   the   consistent   income   stream   dairying   provides   is   also   attractive   to   joint  venture   participants,   as   is   the   simplicity   of   an   enterprise   with   a   single   primary   output.     The  high   returns   on   capital   dairy   enterprises   can   offer   adds   to   the   sector’s   appeal   and   the   New  Zealand   sharemilking   model   serves   as   an   excellent   guideline   in   illustrating   the   benefits   and  opportunities   joint   ventures   in   the   dairy   industry   can   offer.     Thus   although   it   is   possible   for  new  entrants  to  successfully  employ  joint  ventures  in  other  sectors61,  for  the  reasons  outlined  above,  they  are  particularly  well  suited  to  the  dairy  industry62.  While  engaging  in  a  relatively  high  capital  sector  selling  a  product  on  a  market  effectively  set  at  a   commodity   level   runs   contrary   to   much   of   the   discussion   in   previous   sections,   a   joint  venture63  can  enable  new  entrants  to  achieve  the  scale  required  to  compete  with  established  industry  producers,  thus  making  this  option  viable.  All  of  the  individuals  within  this  study  who  were  included  in  Group  2  have  studied  agriculture  or  a  related  topic  at  a  higher  educational  level  and  have  also  spent  a  period  working  abroad.    As  well  as  reinforcing  the  need  for  significant  prior  experience  in  the  field,  it  could  be  inferred  that  these   two   common   features   indicate   that   joint   ventures   are   most   successfully   employed   by  inquisitive  individuals  who  are  prepared  to  search  for  opportunities,  are  ambitious,  and  have  a  desire  to  accumulate  knowledge  and  skills.                                                                                                                      60  By  way  of  a  well-­‐known  example,  Bernard  Mathews  started  with  20  turkey  eggs  and  an  incubator  back  in  1950.  61  As  per  one  case  study  in  this  report  who  has  engaged  in  a  number  of  joint  venture  agreements  in  establishing  his  arable  and  sheep  enterprise  62  As  exemplified  by  3  dairy  farmers  in  this  study,  all  of  whom  are  succesfully  utilising  joint  venture  agreements    63  Be  it  contract  farming,  sharemilking,  an  equity  partnership  or  any  other  agreement     40  
  • 41.  Requirements   for   success   in   pursuing   this   avenue   therefore   include   excellent   communicative  and  negotiation  abilities,  as  well  as  management  and  technical  expertise64.    It  also  appears  to  be   necessary   for   young   farmers   who   are   engaging   in   joint   ventures   to   be   able   to   provide   a  degree  of  personal  capital  to  the  enterprise,  and  it  is  essential  that  they  are  good  at  networking  in   order   to   generate   the   contacts   needed   for   joint   venture   opportunities   to   materialise.     A  proven  track  record  is  vital,  without  which  engaging  with  a  new  entrant  will,  understandably,  be  considered  to  be  too  great  a  risk.    Developing  this  track  record  takes  time  but  once  attained,  it   can   ultimately   be   expected   that   the   period   of   business   growth   that   accompanies   the   joint  venture   establishment   will   be   rapid.     The   young   farmer   may   be   able   to   leverage   their   business  interest   against   another   party’s   assets,   and   the   knowledge   and   skills   sharing   between   the  individuals  should  optimise  returns.                                                                                                                    64  After  all,  a  new  entrant  is  needing  to  persuade  an  established  operator  that  an  enterprise  would  benefit  from  their  involvement     41  
  • 42.   ENDNOTE     “Farming  looks  mighty  easy  when  your  plough  is  a  pencil  and  you’re  a  thousand     miles  away  from  the  corn  field.”  (Eisenhower,  1956)  In  hindsight  it  is  perhaps  inevitable  that  the  two  blueprints  for  establishing  a  farm  business  are  either   to   grow   a   part-­‐time   micro   business   or   to   accumulate   skills   and   then   search   for   joint  venture   opportunities.     However,   all   the   evidence   collected   suggests   these   two   models  ultimately   provide   the   best   templates   for   young   people   looking   to   develop   a   farming  enterprise,   and   so   I   hope   that   through   beginning   to   unpick   some   of   the   issues   surrounding  these  two  blueprints,  this  discussion  has  been  of  some  use.  Perhaps   of   greatest   value   in   this   study   is   the   body   of   evidence   that   has   been   collected   that  suggests  it  is  possible  for  new  entrants  to  develop  their  own  farm  business.    This  dissertation  has   collated   a   list   of   just   a   few   of   those   who   have   succeeded   (or   are   in   the   process   of  succeeding)   in   developing   their   own   agricultural   enterprise,   and   so   by   bringing   together   this  evidence,  it  is  hoped  that  others  considering  starting  their  own  farm  business  will  be  motived  to  pursue  this  aim.  From  the  point  of  view  of  creating  a  blueprint,  it  is  a  shame  that  personal  characteristics  of  a  new  entrant  make  such  a  difference  in  determining  the  success  of  a  new  farming  venture;  after  all,   these   vague   and   semi-­‐tangible   factors   are   near   impossible   to   include   within   the   rigid  confines   of   a   model   business   plan.     Nevertheless,   from   the   perspective   of   a   prospective   new  entrant,   the   significance   of   human   factors   is   very   encouraging   as   they   are   something   it   is  possible  for  an  open-­‐minded  individual  to  change.      There   is   little   a   single   young   farmer   can   do   to   fundamentally   alter   the   system   they   are  presented   with,   but   personal   character   traits   and   attributes   certainly   aren’t   fixed.     At   an  individual   level   it   is   possible   to   acquire   the   skills,   do   the   networking   and   set   ambitious   targets.    It  is  possible  to  develop  practical  expertise,  to  be  hardworking  and  acquire  required  contacts.    If   individual   characteristics   are   so   important   in   developing   an   agricultural   enterprise   then   it  follows   that   it   therefore   must   be   possible   for   a   new   entrant   to   get   into   farming.     Thus   it   is   only  hoped  that  the  two  blueprints  described  above,  as  evidenced  by  the  case  studies  in  this  paper,  provide  a  tentative  framework  from  which  to  begin  when  looking  to  develop  a  farm  business.         42  
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  • 47.  sortBy=pubdate&sortDirection=DESCENDING&content-­‐type=publicationContentTypes&pubdateRangeType>  [Accessed  3  October  2011]    ONS   (Office   for   National   Statistics),   2011b,   Average   actual   weekly   hours   (by   industry   sector),  [pdf]   Labour   market   statistics   data   tables:   September   2011,   Table   HOUR03.     Available   at:  <>  [Accessed  24  September  2011]    Owen,  C.  and  Cowap,  C.,  2009,  Assessing  the  role  of  the  Fresh  Start  Academies  in  encouraging  new  entrants  into  farming,  [pdf]  Harper  Adams  University  College,  RICS  Rural  Research  Conference.    Available  at:  <>  [Accessed  25  September  2011]    Padwick,  N.,  2010,  Farm  Workers  Survey,  Survey  of  2000  farm  workers,  results  published  in  Farmers  Weekly  Magazine,  Issue  dated  2  July  2010,  pp.  20-­‐21    Payne,  A.,  2012,  How  do  you  find  a  million  more  farmers?    A  view  from  Reclaim  the  Fields,  Article  available  at:  <­‐do-­‐you-­‐find-­‐a-­‐million-­‐more-­‐farmers-­‐a-­‐view-­‐from-­‐reclaim-­‐the-­‐fields/>  [Accessed  29  February  2012]    Pigott,  I.,  2011,  New  generation  needs  to  think  in  new  ways,  Farmers  Weekly,  9  December  2011,  p28    Princes  Trust,  2008,  Cultivating  the  next  farming  generation,  [pdf].    Available  at:  <­‐entrants/documents/cultivating-­‐farming-­‐generation.pdf>  [Accessed  26  September  2011]    RICS,  2011a,  A  report  from  Fresh  Start  –  Farming  Ladder  Seminar,  [pdf]  Wednesday  10th  March  2011,  RICS  Rural  Professional  Group.    Available  at:  <>  [Accessed  25  September  2011]    RICS,  2011b,  RICS  Rural  Land  Market  Survey,  H1  2011,  [pdf]  RICS.    Available  at:  <>  [Accessed  25  September  2011]    Salatin,  J.,  1998,  You  Can  Farm  –  the  entrepreneur’s  guide  to  start  and  succeed  in  a  farm  enterprise,  Polyface,  Inc.,  Virginia,  USA    Shadbolt,  N.  and  Martin,  S.,  2005,  Farm  Management  in  New  Zealand,  Oxford  University  Press,  Australia  and  New  Zealand    Soil  Association,  2011,  The  impact  of  community  supported  agriculture:  Key  features  and  benefits,  [pdf]  A  paper  reporting  headline  findings  of  Provenance’s  evaluation  for  the  Soil  Associations  project  to  support  CSA  –part  of  Making  Local  Food  Work,  Bonnie  Hewson  and  Nick  Saltmarsh.    Available  at:  [Accessed  05  January  2012]    Spedding,  A.,  2006,  Focus  on  the  Future,  [pdf]  A  Royal  Agricultural  Society  of  England  report,  prepared  by  Alan  Spedding.  Available  at:     47  
  • 48.  <>  [Accessed  22  September  2011]    Spedding,  A.,  2009,  New  Blood  –  Attracting  the  best  young  people  to  agriculture,  [pdf]  A  Royal  Agricultural  Society  of  England  report,  prepared  by  Alan  Spedding,  Available  at:  <­‐and-­‐media/latest-­‐news/NewBloodReport.pdf>  [Accessed  22  September  2011]    Tasker,  J.,  2011,  A  fair  deal  for  apprentices  would  benefit  us  all,  Article  published  in  Farmers  Weekly  Magazine,  Issue  dated  18  March  2011,  p.  3    Tenancy  Reform  Industry  Group  (TRIG),  2003,  Final  Report,  [pdf]  published  by  DEFRA.    Available  at:  <>  [Accessed  5  October  2011]    Tenant  Farmers  Association  (TFA),  2010,  2020  Vision  for  Agriculture  –  From  the  Perspective  of  the  Tenanted  Sector  of  Agriculture  in  England  and  Wales,  Tenant  Farmers  Association,  Reading    Tenant  Farming  Forum  (TFF),  2008,  Assisting  New  Entrants  Into  Scottish  Farming  –  Recommendations  To  The  Cabinet  Secretary,  [pdf].    Available  at:  <­‐_Final_Copy__2_.pdf>  [Accessed  25  September  2011]    Walker,  J.,  2011,  The  next  generation  needs  a  viable  farming  ladder,  Article  published  in  Farmers  Weekly  Magazine,  Issue  dated  13  May  2011,  p.  33    Williams,  F.,  2006,  Barriers  Facing  New  Entrants  to  Farming  –  an  Emphasis  on  Policy,  [pdf]  SAC  Land  Economy  Research  Group.    Available  at:  <>  [Accessed  25  September  2011]    Williams,  R.,  2011.  Wealth  creation  in  dairy  farming,  Nuffield  Farming  Scholarships  Trust,  A  Trehane  Trust  Award.    Available  at:  <>  [Accessed  2  December  2011]    Whitehead,  I.,  Errington,  A.,  Millard,  N.  and  Felton,  T.,  2002,  An  Economic  Evaluation  of  The  Agricultural  Tenancies  Act  1995,  [pdf]  Newton  Abbot:  The  University  of  Plymouth.    Available  at:  <>    [Accessed  5  October  2011]         48  
  • 49.        APPENDICES   Case  Studies  Detailed  below  are  the  case  studies  that  formed  the  primary  research  used  in  this  study.    Some  of   this   information   was   consolidated   in   the   table   presented   on   page   14,   and   the   discussion  preceding   this   point   consists   of   my   interpretation   of   this   evidence.     Compiling   these   case  studies   was   truly   inspirational   and   for   myself   will   most   likely   prove   to   have   been   a   career  shaping  experience.    I  am  incredibly  grateful  for  all  of  their  help  and  encouragement,  and  only  hope   that   my   brief   summaries   of   these   outstanding   individuals   do   some   justice   to   their  fantastic  and  varied  stories.   Group  1(a)  Sam  Steggles  Primarily   producing   goats   milk   and   cheese   under   the   ‘Fielding   Cottage’   brand,   Sam   runs   his  businesses  while  maintaining  a  full  time  job  in  the  poultry  sector,  and  employs  a  couple  of  staff.      Starting  in  October  2009  with  10  goats,  the  herd  has  expanded  through  breeding  replacements  and   buying   in   extra   stock,   and   currently   milks   in   the   region   of   50   nannies,   with   billy’s  historically  bought  in  and  then  sold  after  mating  to  keep  costs  down.    Renting  a  local  farmer’s  barn   has   provided   Sam   with   the   minimal   amount   of   land   needed   to   start   the   business,   and   has  provided   his   landlord   with   a   new   diversified   income   stream   on   an   otherwise   arable   and  poultry   farm.     Furthermore,   Sam   has   been   able   to   source   straw   and   hay   from   his   landlord,  strengthening   their   relationship.     A   £5000   grant   helped   fund   investment   in   the   parlour   and  dairy,  and  also  serves  as  evidence  of  other  people’s  belief  in  his  business.      By   way   of   marketing,   Sam   makes   great   use   of   social   networking   sites   and   has   had   media  coverage   in   regional   and   national   papers.     Fielding   Cottage   products   are   sold   at   2   to   3   markets  per   week,   and   through   producing   dairy   products,   output   can   remain   (relatively)   constant   all  year,  enabling  continued  cash  flow.    Diversification  into  pigs  fed  on  the  whey  that  is  produced  as  a  by-­‐product  of  cheese  making  has  provided  an  additional  income  stream,  as  has  a  goat  meat  box  scheme  for  some  of  the  surplus  male  offspring.    Currently  exploiting  a  significant  niche  by  being  the  only  goats  cheese  producer  in  the  county,  Sam  has  ambitions  to  keep  growing,  and  looks  to  eventually  have  a  considerably  larger  herd  of  nannies.  Sam   demonstrates   how   through   making   use   of   under-­‐utilised   land   and   engaging   with   a  landowner  it  is  possible  to  secure  a  plot  on  which  to  start  a  business.    He  clearly  illustrates  how  exploiting   a   niche   market   can   help   a   fledgling   enterprise   to   grow   and   is   an   obvious   example   of  how   hard   work   and   determination   are   key   in   getting   an   enterprise   of   the   ground,   with   his     49  
  • 50.  successful   business   illustrating   what   can   be   achieved   when   you   are   prepared   to   put   in   the  hours  either  side  of  a  day  job.    Matt  Dale  Having   initially   started   the   business   with   the   purchase   of   3   cows   in   2006,   North   Aston   Dairy   is  an   organic   micro-­‐dairy,   producing   un-­‐homogenised   milk   from   a   herd   that   now   numbers   in   the  region   of   20   Ayrshire   cows.     Run   on   40   acres   of   a   larger   diversified   estate,   the   dairy   employs   2  full   time   staff   equivalents,   and   is   closely   tied   to   other   enterprises   on   the   larger   farm.   While   the  land   the   dairy   is   on   is   rented,   there   is   a   small   profit   share   agreement   with   the   landlord.    Machinery  sharing  is  commonplace  (even  an  Aberdeen  Angus  bull  is  borrowed  for  9  months  of  the   year),   and   the   dairy   shares   some   of   its   delivery   round   with   an   organic   vegetable   box  scheme.    Through  directly  marketing  a  niche  product,  profit  margins  are  optimised,  and  there  is  seemingly  an  insatiable  demand  for  the  milk.  Cow   longevity   is   maximised   (thus   reducing   replacement   costs)   through   managing   a   welfare  friendly,  low  stress  environment.    The  dairy  cows  are  run  on  a  15  month-­‐cycle,  of  which  only  the  first  6  months  are  spent  in  the  milking  herd.    Calves  are  then  adopted  onto  a  cow  who  is  been  milking  for  6  months,  and  fostered  for  a  6  month  period  before  being  sold  as  rose  veal.    Effectively   the   herd   therefore   functions   as   a   suckler   herd   within   a   dairy   herd,   with   milk  customers  encouraged  to  buy  veal  in  proportion  to  the  amount  of  milk  they  consume.  ‘Cow   bonds’   were   used   to   initially   finance   buying   the   cattle,   with   investors   contributing  towards  a  3  year  fixed  bond  with  a  5%  rate  of  return.    It  enabled  Matt  to  obtain  credit  at  a  rate  far   cheaper   than   the   banks   were   offering,   and   also   proved   to   be   a   fantastic   way   of   attracting  long-­‐term  customers.  As  a  business  model  it  is  incredibly  replicable,  indeed  it  would  be  mutually  beneficial  if  another  micro-­‐dairy  were  to  set  up  reasonably  near  by.    The  milk  round  provides  a  consistent  income  stream,  while  sales  at  farmers  markets  are  able  to  absorb  any  surplus.    While  not  necessarily  being  an  example  of  a  CSA  as  per  the  Soil  Association  definition,  the  local  community  is  the  sole  customer   of   North   Aston   Dairy,   and   it   is   also   members   of   the   community   who   have   invested   in  the  ‘cow  bonds’  that  helped  to  get  the  business  off  the  ground.  Rona  and  Nevil  Amiss  Rona’s   story   in   many   respects   reflects   what   one   might   traditionally   regard   as   the   first  generation   ‘farming   ladder’.     Both   her   and   her   partner   Nevil   are   from   non-­‐farming  backgrounds  but  were  desperate  to  farm.    After  completing  their  studies  at  Harper  Adams,  they  worked   on   a   range   of   farms,   making   the   effort   to   accumulate   the   skills   they   required.     After     50  
  • 51.  applying   for   a   number   of   tenancies   they   realised   that   lots   of   other   applicants   were   already  running   micro-­‐businesses   which   were   giving   them   a   competitive   edge,   so   Rona   and   Nevil  therefore  established  a  flock  of  Herbridean  sheep  and  started  rearing  chickens  and  geese  on  a  small   scale.     This   meant   that   when   they   later   applied   for   further   tenancies,   they   were   all   the  more   credible   when   stating   they   intended   to   directly   market   their   produce,   having   already  obtained  considerable  experience  in  this  area.  Hitting   the   organic   niche   just   as   it   was   taking   off,   in   1999   the   couple   obtained   a   180-­‐acre  tenancy   on   Exmoor,   and   in   2005   moved   to   a   57-­‐acre   farm   rented   from   Devonshire   Country  Council.     They   expanded   their   poultry   processing   facilities,   and   now   rear   ducks   for   meat   and  eggs,  geese  for  Christmas,  have  a  flock  of  70  sheep,  a  herd  of  20  cows  and  some  pigs,  all  on  57  acres!    On  top  of  this  they  have  additional  farmers   contract   rearing   chickens   for   them,   have   an  on   site   abattoir   and   butcher,   and   employ   two   additional   full   time   employees   plus   some   part  time  staff.  Having  just  completed  a  Nuffield  Scholarship  report  on  New  Entrants  (see  Amiss,  2011)  Rona  has   started   an   additional   side-­‐line   rearing   goat   kids,   and   is   investigating   applying   principles   of  CSAs  from  the  USA  to  pig  production  over  here.    Through  direct  marketing  and  a  few  wholesale  orders   to   a   list   of   clientele   that   include   the   likes   of   Hugh   Fearnly-­‐Whittingstall   and   Duchy  Originals,  the  pair  remain  closely  connected  to  their  customers,  with  Rona  suggesting  that  the  customers  not  only  buy  the  produce,  but  also  buy  a  bit  of  your  life.  By   running   a   highly   diversified   business   the   couple   clearly   illustrate   how   intensive   it   is  possible   to   be   on   a   small   acreage,   as   well   as   the   importance   of   marketing   and   identifying  niches.    In  her  Nuffield  report  Rona  posits  the  question;  “Is  a  57-­‐acre  tenanted  farm  making  a  living   for   a   family   of   seven   successful   of   not?”   (Amiss,   2011,   p14).     The   answer   has   to   be   a  resounding  Yes.  Lucy  Hollands  and  Damian  van  Aswegen  Ever   since   I   visited   Lucy   and   Damian   at   the   Rare   Breed   Pig   Company,   I’ve   been   wittering   on  about   the   benefits   of   pigs   in   woods.     Their   enthusiasm   is   infectious,   their   award   winning  sausages  are  delicious,  and  their  rapid  business  growth  is  quite  remarkable.  Deciding   they   wanted   to   follow   a   career   in   farming,   Lucy   and   Damian   googled   ‘pig   keeping  courses’,   and   after   attending   a   one-­‐day   event,   they   bought   4   pigs.     In   2007   they   started   their  business   on   5   acres   of   rented   woodland,   and   are   now   renting   a   40-­‐acre   site.     Currently   they  have   45   sows,   (having   only   started   breeding   pigs   in   earnest   2   years   ago)   and   around   200   pigs.    They  have  recently  opened  a  fantastic  farm  shop,  look  to  reach  350/400  pigs  in  the  near  future,     51  
  • 52.  and  are  in  the  process  of  helping  other  new  entrants  establish  alternative  enterprises  to  supply  them  with  additional  products.  Lucy  is  able  to  clearly  articulate  why  pigs  in  woods  is  an  absolute  no  brainer.    With  woodland  often   sitting   unused,   forest   enterprises   provide   landlords   with   the   opportunity   to   earn   an  additional   income   stream,   and   by   rotating   pigs   around   different   areas   of   the   woodland,   they  can   transform   the   undergrowth   and   forest   floor.     The   trees   provide   shelter   meaning   the   pigs  can  be  outside  all  year,  saving  on  capital/housing  infrastructure.    Rare  breeds  are  at  home  in  the  outdoor  environment,  and  even  if  they  do  take  a  bit  longer  to  grow,  could  not  look  more  content  in  amongst  the  trees.  In   spite   of   the   couple   producing   an   excellent   business   plan,   banks   proved   to   be   unwilling   to  lend   the   money   needed   to   get   the   business   off   the   ground.     Thus   initial   funding   came   from  personal  savings  and  financing  from  private  investors  who  were  able  to  recognise  the  human  factors  about  Lucy  and  Damian  that  were  likely  to  mean  that  they  were  successful.    By  growing  the  business  in  stages  (albeit  very  fast)  the  capital  investment  has  also  been  more  bearable.  Amongst   other   things,   Lucy   and   Damian   illustrate   that   if   you   do   your   homework,   produce   a  sound   business   plan   and   are   well   versed   on   what   you   are   looking   to   achieve,   then   landlords  will  be  more  likely  to  consider  your  business  propositions.    They  also  demonstrate  that  non-­‐traditional   sources   of   capital   are   available   and   are   another   example   of   the   benefits   of   direct  marketing  and  finding  a  niche.  Chris  Fogden  Chris   is   first   generation   pig   producer   who   started   his   business   in   1987.     He   liked   the   idea   of  farming  dairy  cows,  but  the  quota  system  presented  difficulties,  and  so  he  elected  to  start  up  with   pigs;   recognising   that   the   business   could   be   commenced   with   a   relatively   small   capital  investment  and  that  it  offered  the  potential  for  rapid  growth.    Outdoor  pig  production  provided  the   opportunity   for   a   regular   cash   flow,   and   ticked   many   other   boxes,   with   outdoor   pig  breeding  still  being  a  production  niche.  Starting   with   60   sows   on   a   ten-­‐acre   site,   Chris’s   business   was   able   to   grow   rapidly,   with   the  outdoor   system   he   adopted   being   comparatively   easy   to   restructure,   where   a   more   intensive  indoor  system  would  have  had  its  growth  constrained  by  its  existing  infrastructure.    He  found  there  was  a  ready  market  for  his  piglets,  and  so  in  spite  of  considering  direct  sales,  ultimately  never   needed   to   pursue   this   route.     Through   networking   and   making   use   of   existing   farming  contacts  Chris  took  advantage  of  short-­‐term  leases  on  light  land  which,  while  meaning  he  was  competing  with  vegetable  producers  who  could  offer  high  rents,  at  least  provided  him  with  the  space  the  business  required.     52  
  • 53.  Having   grown   to   1,000   sows   and   moved   into   finishing   pigs   too,   the   business   was   forced   to  restructure  in  light  of  higher  feed  costs.    Chris  took  a  step  back,  re-­‐evaluated  his  system,  and  was   able   to   implement   changes   that   increased   production   from   18   to   24   piglets   per   sow   per  year.  Chris’s  successes  again  show  how  important  it  is  for  new  entrants  to  exploit  niche  markets  in  the   initial   stages.     He   reiterated   that   “tenacity…   or   just   bloody   mindedness”   is   essential   in  bringing  success,  and  how  co-­‐operation  with  other  producers  can  have  great  mutual  benefits.    However,   perhaps   more   than   anything   else,   he   clearly   illustrates   how   important   it   is   to   remain  business   focused,   to   take   opportunities   as   and   when   they   arise,   and   to   re-­‐evaluate   and   re-­‐structure  your  business  as  required  in  order  to  optimise  profitability.  Ed  Hamer  "Start   small,   be   enthusiastic,   be   hardworking"   says   Ed.   His   successes   illustrate   what   can   be  achieved  when  you  do  just  that.    Growing   up   in   a   rural   area   where   paper   rounds   werent   available,   Ed   engaged   in   part-­‐time  farm   work   while   at   school.   Seeing   the   way   the   farming   landscape   was   changing   got   him  "hooked"   on   pursuing   a   career   in   agriculture,   and   culminated   in   him   completing   a   degree   in  agro-­‐forestry,   focusing   on   tropical   agriculture.   An   interest   in   agricultural   policy   led   him   to  work  in  Uganda,  Jamaica  and  Mexico,  before  deciding  the  tropical  climate  wasnt  for  him  and  returning  home.  Back  in  the  UK  Ed  worked  as  a  journalist  and  for  the  ecologist  magazine,  and  in  the  process  was  exposed  to  allot  of  literature  regarding  sustainable  agriculture,  but  became  aware  that  not  many  people  were  putting  the  theory  into  practice.    Recognising   there   were   lots   of   local   beef   and   dairy   farms,   he   identified   a   niche   that   could   be  utilised   growing   organic   vegetables.  He  then  met  Chinnie  Kingsbury,   co-­‐founder  of  Chagfood.    Together   they   were   able   to   obtain   a   grant   toward   the   capital   costs   involved   in   establishing   the  business   (under   the   lottery   funded   making   local   food   work   campaign)   and   so   proceeded   to  use  his  existing  farming  contacts  to  acquire  a  plot  of  land.    Operating   on   a   3-­‐acre   site,   the   business   now   supplies   50   vegetable   boxes   per   week   to   the   local  community,   and   follows   a   CSA   model.   Initially   customers   were   sourced   though   public  meetings;   with   the   planning   permission   application   process   required   for   the   business  polytunnels   being   beneficial   in   raising   awareness   and   bringing   public   support.   However   Ed  suggests  that  one  of  the  business  greatest  marketing  tools  is  their  horse,  Samson.  As  well  as  doing  the  majority  of  the  cultivation  work,  taking  Samson  on  the  veg  box  delivery  round  raised  awareness  of  the  scheme  among  the  local  community.  With  grant  funding  expiring  this  year,  the  businesses  will  need  to  be  producing  75  veg  boxes     53  
  • 54.  per   week,   and   at   that   stage   will   finally   be   able   to   provide   full   time   employment   for   Ed   and  Chinnie.  He  estimates  the  optimal  size  for  the  business  will  be  producing  120  boxes  per  week,  at  which  point  it  should  be  capable  of  sustaining  two  full  time  employees  as  well  as  additional  seasonal   labour.   Ed   believes   his   successes   are   absolutely   replicable,   and   that   while   the   grant  funding   was   unquestionably   beneficial,   the   business   would   still   have   been   able   to   get   off   the  ground  without  it,  (although  its  development  would  have  been  slower).  His  achievements  show  how  CSAs  are  well  suited  to  new  entrants,  offering  a  "built  in  resilience"  through  encouraging  consumer  engagement,  and  providing  working  capital  upfront.     Group  1(b)  Michael  Blanche  Michael  has  been  unbelievably  helpful  in  offering  advice  and  guidance  when  he  has  evidently  been  extremely  busy  caught  up  with  other  things.    For  that  I  owe  him  a  massive  thanks.      His  commitment  as  a  new  entrant  is  phenomenal.    He  calculated  that  in  the  past  5  years  he’s  spent   1100   hours   driving   to   and   from   his   sheep,   costing   £20,000   in   fuel   and   in   the   process  covering  a  distance  equivalent  to  twice  the  circumference  of  the  globe.    And  more  recently  he  has   quite   literally   travelled   around   the   world   researching   ‘the   farming   ladder’   (see   Blanche,  2011).  A  first  generation  farmer  and  farm  consultant,  Michael  a  spent  number  of  years  working  for  the  SAC  as  an  advisor  which  he  described  as  being  like  “working  in  a  sweetie  shop”,  with  experts  always  available  on  the  other  end  of  the  phone.    But  in  2003,  deciding  he  was  desperate  to  farm  in   his   own   right,   he   bought   50   ewes   using   a   balance   transfer   from   a   credit   card,   and   since   then  has  expanded  to  a  600  ewe  flock,  spread  across  seasonal  lets.    With  a  previous  landlord  he  had  an   arrangement   that   approached   being   a   share-­‐farming   agreement,   and   more   recently   has  finally   managed   to   secure   the   tenancy   he   has   been   searching   for.     Having   obtained   this   new  land  he  has  started  also  rearing  dairy  bull  calves  in  order  to  increase  cash  flow,  making  use  of  joint  venture  principles  to  the  parties  mutual  benefit.  Michael   is   evidently   ambitious.     In   his   own   words;   “I   have   to   be   the   very   best   farmer   I   can  possibly   be.     Achieve   Operational   Excellence.     Be   in   the   Top   5%   of   producers.     Gulp.”     He  believes  the  33%  p/a  equity  growth  he  has  achieved  to  date  isn’t  nearly  enough  growth  if  he  is  serious  about  building  a  farm  business  of  true  worth,  and  accordingly  has  begun  experimenting  with  paddock  and  cell  grazing  systems  with  his  ‘open  composite’  breed  of  sheep.     54  
  • 55.  Gareth  Barlow  When   asked   what   advice   he’d   give   to   another   new   entrant   looking   to   replicate   what   he’d  achieved,   Gareth’s   response   was;   “Believe   in   yourself   from   the   outset”.     In   many   respects   I’d  say   that   his   success   and   considerable   publicity   demonstrate   just   that,   while   he   is   quick   to  recognise  the  contribution  of  others.  Having  kept  a  few  sheep  since  2007,  Gareth  left  university  to  follow  his  farming  ambition.    In  April   2010,   his   business   started   to   take   off,   and   under   the   trading   name   of   Howardian  Hebrideans,  he  sold  150  lambs  in  the  2010/2011  season.    With  a  flock  currently  numbering  40  ewes,   he   intends   to   have   75   in   the   near   future,   and   sell   around   450   lambs   from   April   2011-­‐2012,  buying  in  stores  to  make  up  the  shortfall.      Incredibly   growth   orientated   and   with   considerable   business   acumen,   Gareth   describes   how  turnover  is  essential,  not  wanting  money  to  “stick  around”.    Buying  stores  creates  variety  in  the  flock,   enabling   lambs   to   be   sold   all   year   and   improving   cash   flow.     Nonetheless,   cash   flow  remains  the  key  variable  currently  limiting  business  expansion,  with  Gareth  indicating  the  he  hasn’t  had  too  much  trouble  finding  land,  recognising  that  if  people  can  see  you  doing  a  good  job  elsewhere,  they  will  generally  be  willing  to  offer  you  a  couple  of  additional  acres.  Working  part  time  as  a  butcher,  it  is  apparent  that  he  is  accumulating  key  skills  that  will  help  his  business  grow  further  and  is  reducing  the  additional  costs  of  adding  value  to  his  products  by   doing   the   butchery   himself,   with   the   result   that   direct   marketing   is   proving   to   be   an  excellent  sales  route.    Giving  samples  to  restaurants,  having  newspaper  and  magazine  articles  published,   and   using   social   media   sites   such   as   twitter,   has   all   helped   Gareth   to   build   his  customer  base.    Furthermore,  his  coverage  by  the  BBC  has  thrown  him  into  the  media  spotlight,  and  has  certainly  helped  in  building  the  credibility  of  his  brand.    So  is  his  model  replicable?    Yes,  but…  “Geography  matters”.    Location  has  played  a  big  part  in  helping   the   business   grow.     Yorkshire   is   very   food   based,   and   has   allot   of   Michelin   Starred  restaurants   which   has   helped   Gareth   to   exploit   a   considerable   food   niche.     Rare   breeds   have  proven  to  be  a  successful  avenue  to  pursue,  but  customers  have  needed  to  be  educated  as  to  their  benefits.      Finally,   the   big   question   is   the   BBC   coverage   –   has   that   been   critical   to   his   success?     No,   I’d   say  it  hasn’t  –  his  drive  and  determination  has  probably  been  more  important.    But  has  the  media  coverage  nonetheless  been  helpful?    Yes,  most  likely.       55  
  • 56.  Emma  Gray  Emma   cites   her   success   as   being   down   to   the   fact   that   she   has   “been   incredibly   lucky”.    Perhaps,  but  I  think  that  there  is  clearly  more  to  it  than  that.  A   daughter   of   tenant   farmers,   Emma   is   a   case   study   who   technically   isn’t   a   first   generation  farmer.     However,   with   her   parent’s   tenancy   being   relatively   short-­‐term,   there   was   little  prospect  of  any  succession,  and  so  she  was  left  in  the  position  of  a  textbook  new  entrant,  albeit  with  the  benefit  of  extensive  background  experience.    Upon  completion  of  a  sheep  management  course,   Emma   proceeded   to   take   a   shepherding   job   for   4   years,   but   was   keen   to   farm   in   her  own  right,  with  her  own  sheep  and  her  own  business.  After  applying  for  a  number  of  tenancies,  she  applied  for  a  5-­‐year  tenancy  at  Fallowless  Farm  –  a  National  Trust  property.    Lacking  allot  of  basic  infrastructure,  being  very  isolated  and  quite  small  with  severely  disadvantaged  land,  she  thought  there  would  be  little  demand  for  the  farm.    In   fact   there   were   25   cars   at   the   open   day,   and   a   great   deal   of   competition   for   the   tenancy.    Suspecting   the   National   Trust   were   keen   for   the   land   to   be   used   for   agricultural   production,  Emma   produced   a   business   plan   that   demonstrated   her   intention   to   farm.     Furthermore,   she  recognised   that   the   National   Trust   would   most   likely   welcome   the   publicity   she   was   already  been   receiving   for   her   sheepdog   trialling   successes.     By   evaluating   what   the   landlord   was  looking   for,   and   seeking   to   meet   their   requirements,   Emma   was   able   to   secure   the   tenancy,  seemingly  against  the  odds.  Since  beginning  to  farm  at  Fallowless,  Emma’s  public  acclaim  has  escalated.    Being  a  girl  in  a  predominantly   male   dominated   sheepdog   trialling   circle   meant   that   her   successes   with   her  dogs   attracted   attention   from   the   media,   which   led   to   an   article   in   the   Daily   Mail,   and  subsequently  an  appearance  on  the  BBC’s  Countryfile.    However,  her  publicity  has  by  no  means  been  essential  in  her  success.    By  having  a  diversified  income  stream  stemming  from  sheepdog  training  and  breeding,  contract  shepherding  and  her  own  flock,  she  has  provided  herself  with  a  more  stable  income  while  her  own  flock  grows.  Emma   suggested   that   one   of   the   main   problems   she   faced,   and   continues   to   contend   with,   is  getting   ‘stocked   up’.     Due   to   livestock   being   so   expensive   to   purchase,   Emma   only   needed   a  small  farm  to  get  started,  however  a  smaller  farm  (especially  of  the  type  of  land  she  farms)  is  only  able  to  generate  limited  returns  making  it  difficult  to  fund  the  expansion  she  is  seeking.    Nevertheless,   by   growing   steadily,   Emma   is   able   to   ensure   that   risks   are   taken   in   an  environment  where  mishaps  are  less  significant,  and  her  previous  practical  experiences  have  enabled  her  to  make  any  mistakes  in  an  environment  where  the  effects  are  less  pronounced.         56  
  • 57.  Evidently   incredibly   bright   and   personable,   Emma   illustrates   the   importance   of   standing   out  from  the  crowd  and  looking  to  set  yourself  apart  from  other  parties  competing  for  resources.    She  also  exemplifies  the  need  to  cater  your  proposed  enterprise  to  a  landlord’s  requirements,  and   how   it   is   useful   to   have   a   diversified   income   stream   in   the   initial   stages   of   business  development.  Tim  White  When  I  interviewed  Tim  in  November  he  said  “Don’t  be  a  farmer  like  everyone  else”.    I  presume  he   meant   differentiate   yourself   from   other   farmers,   as   opposed   to   give   up   on   a   career   in  farming  altogether!  The  former  being  the  case,  its  a  quote  that  has  stuck  with  me  ever  since.  Coming  from  a  non-­‐farming  background,  Tim  spent  a  number  of  years  working  on  a  range  of  farms,  before  undertaking  an  environmental  science  degree.    However  that  reinforced  to  him  that   more   than   anything   he   wanted   to   farm   and   be   self-­‐employed,   so   he   went   to   work   on   a  large  farm  where  he  articulated  that  a  condition  of  his  employment  be  that  he  should  have  a  patch  of  land  to  farm  as  he  wished.    Starting  a  20  cow  suckler  herd  exploiting  a  niche  producing  organic   veal,   he   was   forced   to   rethink   the   business   in   the   face   of   increased   competition,   and  bought  a  couple  of  hundred  sheep  (“as  a  hobby”!)  instead.  In  2007  he  started  his  sheep  business  in  earnest,  placing  an  add  on  the  soil  association  website  looking  for  land,  and  contacting  local  landlords.    Presently  he  has  8/900  ewes  spread  across  4  sites   of   short   term   grazing   lets,   and   relief   milks   for   one   of   his   landlords   in   exchange   for   winter  grazing.    Building  a  local  reputation  has  helped  him  secure  additional  grazing,  with  landlords  willing   to   rent   him   pasture   having   heard   of   the   good   job   he   has   done   elsewhere.     Currently   his  land  is  widely  distributed,  with  him  about  to  take  on  additional  grazing  60  miles  from  his  base,  but  by  employing  someone  else  to  do  the  day-­‐to-­‐day  stock  checks,  this  presents  few  significant  problems.      Tim’s   ability   to   exploit   niches   and   his   innovative   ideas   have   been   key   to   bringing   success,   with  him   recognising   that   both   factors   are   important   when   competing   with   larger   established  producers   who   have   considerable   economies   of   scale.     His   involvement   in   breeding   Exlana  sheep  (a  new  ‘easily  managed’  type  dam  line  for  prime  lamb  producers)  has  provided  him  with  a   beneficial   sales   route,   and   signs   beside   footpaths   that   cross   his   grazing   land   attract   further  customers.      Furthermore,  Tim  manages  his  time  carefully.    In  2010,  his  sheep  enterprise  only  required  on  average  a  29-­‐hour  week,  and  he  has  aspirations  to  farm  3/4000  ewes  in  a  ranched  low  input  system,  while  only  being  required  to  spend  40  hours  per  week  on  the  flock.       57  
  • 58.  Tim   offered   a   number   of   helpful   pieces   of   advise.     Firstly   he   made   clear   that   if   your   intial  enterprise  fails,  then  don’t  worry,  just  switch  to  something  new.    Secondly  be  emphasised  the  importance   of   asking   for   help   and   taking   opportunities   as   they   arise;   that’s   how   you   make  progress.    He  also  reiterated  the  importance  of  getting  on  and  getting  started  while  you  are  still  young,   and   that   it   is   effectively   a   given   that   you   will   initially   have   to   work   elsewhere   to  maintain  an  income  stream  while  your  business  gets  established.  Helen  Reeve  Although  Helen’s  family  have  a  history  of  involvement  in  farming,  there  was  no  prospect  of  inheriting   a   family   farming   enterprise.     The   gift   of   a   Dexter   heifer   when   she   was   14  galvanised  her  desire  to  pursue  a  career  in  farming,  and  following  completion  of  her  GCSEs  she   embarked   upon   employment   at   a   local   dairy   farm.     Subsequently   she   went   on   to  complete  an  NVQ  and  HND  in  agriculture,  all  the  while  developing  practical  skills  through  continued  employment  at  the  same  dairy  farm  where  she  continues  to  work  to  this  day.  In  2007  she  reached  a  turning  point  –  either  it  was  time  to  give  up  with  the  5  Dexter  cows  she   had,   or   push   on   and   establish   a   business   of   her   own.     Electing   the   latter   option,   she  proceeded   to   grow   the   herd   which   now   numbers   34   cattle,   under   the   Waveney   Dexters  brand.  Helen  says  that  obtaining  land  has  been  the  key  factor  constraining  her  businesses  growth,  with  her  currently  being  confined  to  an  8-­‐acre  paddock.    Strong  local  demand  for  grassland  makes   securing   additional   pasture   difficult,   although   she   is   now   looking   to   pursue  opportunities   for   conservation   type   grazing,   with   Dexter   cows   being   well   suited   to   such  land.     Through   converting   a   redundant   gilt-­‐rearing   shed   on   a   larger   farming   estate   she   has  provided  herself  with  much  needed  buildings  and  a  base  for  her  business.  Keen  to  minimise  borrowings,  Helen  has  funded  business  expansion  with  personal  savings,  and  has  benefitted  from  two  trust  funds  -­‐  the  Chris  Lewis  Award,  and  the  Growing  Business  Award.    While  cash  flow  remains  tight  (with  suckler  cows  tying  up  allot  of  “dead  money”)  Helen  is  reluctant  to  take  on  debts,  preferring  to  fund  business  expansion  through  natural  growth,  and  in  5  years  time  is  looking  to  be  running  around  70  head  of  cattle.  Helen   in   part   attributes   her   success   as   being   down   to   her   being   in   the   “right   place   at   the  right   time,   and   speaking   to   the   right   people   to   get   the   right   results”.     However,   through  direct   marketing   a   niche   product   she   is   looking   to   further   add   value   and   develop   an  established  brand,  eventually  seeking  to  gain  full-­‐time  employment  though  her  own  herd.       58  
  • 59.   Group  2  Robert  Law  In   a   very   successful   career   as   a   first   generation   farmer,   Robert   has   progressed   from   being   a  new   entrant   to   winning   the   accolade   of   Farmers   Weekly   Farmer   of   the   Year   in   2006.     It   is  therefore  not  a  surprise  that  he  was  described  to  me  as  being  “the  ultimate  new  entrant”.      Following  on  from  holiday  employment  as  a  farm  worker  and  then  a  period  studying  at  Harper  Adams,  Robert  returned  to  the  farm  he  had  worked  on  in  his  teens  and  progressed  to  becoming  a  manager  and  later  an  equity  partner  on  the  arable  and  sheep  farm.    7  years  down  the  line,  the  partnership   split   and   Robert   bought   out   the   other   partner   on   half   of   the   farm   using   existing  capital,  a  family  loan  and  a  large  mortgage.    Realising  in  the  early  90’s  that  the  farm  business  had  to  expand  to  remain  viable,  new  grazing  was  found  at  a  racehorse  stud,  and  more  land  was  taken  on,  with  the  original  partner  resuming  being  involved  in  the  operation  in  the  mid  90’s.    Additional  land  was  subsequently  purchased,  contracting  taken  up  in  new  areas,  and  the  sheep  flock   expanded   on   to   new   grazing.     Currently   the   arable   operation   spans   over   3,000   acres,   and  700  acres  of  grazing  are  available  at  various  times  in  the  year,  spread  a  considerable  distance  around  the  central  farms.      While  Robert’s  success  demonstrates  what  is  possible,  aspects  of  his  story  are  inapplicable  to  current   new   entrants,   not   least   that   some   of   his   land   is   currently   farmed   under   ‘old   style’  tenancies   that   are   no   longer   common   practice,   and   also   that   he   was   able   to   take   on   large   loans  that  are  unlikely  to  be  available  in  today’s  credit  market.      Nonetheless,   many   key   principles   of   Robert’s   success   are   applicable   to   current   first   generation  farmers.     Producing   sheep   in   a   largely   arable   area   has   enabled   the   business   to   keep   expanding  on   land   for   which   there   is   limited   local   demand,   and   the   initial   partnership   proved   to   be   a  successful  way  of  building  equity.    Furthermore,  while  Robert  says  he  has  had  to  ‘muddle  and  struggle   through’,   all   I   have   seen   of   his   businesses   suggests   it   is   incredibly   efficient,   employs  highly  skilled  staff,  and  has  been  very  growth  orientated  to  reach  its  current  scale.    On  top  of  this,   contracting   arrangements   where   profits   are   shared,   have   also   enabled   him   to   successfully  compete  for  new  land.  Rhys  Williams  Coming  from  a  family  who  had  a  10-­‐acre  smallholding  and  with  his  father  working  for  the  NFUW,   Rhys   certainly   had   an   agricultural   background   but   had   no   great   farming   enterprise  to  inherit.    Recognising  the  best-­‐paid  jobs  existed  in  dairy  farming,  he  therefore  took  a  job  as   a   herdsman,   soon   being   promoted   to   farm   manager.   Desperately   wanting   to   farm   on   his  own  account  but  realising  there  were  few  opportunities  available  at  the  time,  Rhys  went  to     59  
  • 60.  work   for   DEFRA   for   a   period   that   coincided   with   the   2001   F&M   outbreaks,   and   learnt  valuable   people   management   skills   in   the   process.     However,   aware   that   this   was   not   for  him,   in  2002   he  and  his  partner  set  off   to   New   Zealand   to   start   sharemilking,   with   the   goal  of   owning   500   cows   in   5   years,   but   in   2004   were   drawn   back   to   the   UK   following   an  unexpected  meeting  with  a  local  land  owner  looking  to  enter  into  a  partnership.      Returning  to  Wales,  the  grass  based  milking  system  took  off.    Starting  with  a  7%  share  of  an  80  cow  herd  in  2005,  he  now  has  a  50%  share  in  1600  cows  and  smashed  the  500  cows  in  5  years  target  on  route.  Looking   forward,   Rhys   is   keen   for   further   growth,   so   much   so   that   he   embarked   on   a  Nuffield   Scholarship   of   his   own   to   “look   at   farm   business   structures   that   encourage   and  enable  both  expansion  and  rapid  wealth  creation”  (Williams,  2011,  p1).    Looking  to  employ  only   the   best   staff,   he   seeks   out   the   top   students   he   can   find   and   then   arranges   work  experience   for   them   in   New   Zealand   (Baird,   2011),   and   has   aspirations   of   running   a  significantly  larger  herd  in  the  future.  Rhys   is   unequivocal   proof   of   the   returns   that   are   available   through   well-­‐run   farming  operations.     Dairying   offers   high   returns   on   capital   employed,   but   the   initial   capital  requirement   is   large.     His   focus   on   return   on   capital   and   equity   growth   are   phenomenal,  and   his   success   is   a   clear   indication   of   what   can   be   achieved   when   you   set   targets,   get   your  head  down  and  get  on  with  it.    He  was  inspirational  to  meet,  and  has  me  completely  hooked  on  the  career  opportunities  presented  by  grass  based  dairying.  Adam  Boley  With   a   family   already   involved   in   dairy   farming,   it   was   a   natural   progression   for   Adam   to   head  to  Agricultural  College.    Enthused  by  grass  based  dairying  systems  he  proceeded  to  fly  out  to  New   Zealand   the   day   after   his   final   exam   in   order   to   begin   his   “real   education”,   and   spent   3  years   immersed   in   dairying   on   the   other   side   of   the   world,   acquiring   skills   and   “living   and  breathing  low  cost  milk  production”.    Returning  to  the  UK  he  took  a  position  as  a  farm  manager  in   Wales,   expanding   the   business   while   enquiring   into   opportunities   for   various   forms   of  partnership.     Desperate   to   set   up   a   large   scale   pasture   based   dairy   farm   of   his   own,   but   still  believing  he  lacked  one  or  two  skills  necessary  to  establish  the  business,  he  went  to  work  as  an  Operations   Manager   in   the   USA   where   he   was   involved   in   the   management   of   a   number   of  recently  established  500  cow  farms.  Returning  to  the  UK  in  2008  Adam  engaged  in  networking  and  developing  contacts,  travelling  many   miles   to   generate   ideas   and   joint   venture   opportunities.     Through   the   Wye   Graze  Discussion   Group   he   met   Rich   and   Chris   Norman   who   had   recently   been   approached   by   a     60  
  • 61.  landlord  that  was  looking  to  establish  a  contract  farming  agreement  and  convert  a  beef,  sheep  and   arable   farm   into   a   dairy   unit.     With   the   Normans   having   recently   expanded   their   own  dairying   enterprise   they   were   unable   to   pursue   the   opportunity   alone,   but   were   willing   to  enter  into  a  Limited  Liability  Partnership  with  Adam.    Following  an  18-­‐month  negotiation  and  formalisation   of   contracts,   in   2009   the   farm   conversion   began.     Simultaneously   purchasing  yearling  cattle  and  growing  them  on  while  the  farm  was  in  conversion  helped  control  some  of  the   partnerships   costs,   while   also   enabling   investment   in   an   asset   that   was   appreciating   as   the  business  was  getting  off  the  ground.  A   contract   farming   agreement   is   employed,   with   the   landowner   paying   Norman   Boley   LLP   a  sum   to   lease   cows   plus   an   additional   fee   for   labour   and   machinery,   (although   Adam   makes  clear   that   investment   in   machinery   has   been   minimal,   questioning   the   logic   behind   buying   a  tractor   while   the   business   is   still   developing   when   instead   you   could   purchase   30   additional  cows,)  while  a  further  agreement  regulates  paying  the  landowner  to  rear  replacement  calves  on   his   land.     Once   all   costs   have   been   accounted   for,   and   the   partnership   and   landowners  respective   fees   have   been   paid,   the   divisible   surplus   is   then   split   in   favor   of   the   contractor,  incentivising   increased   production   efficiency.     The   Normans   separately   run   an   Autumn   block  calving   herd,   which   engages   in   machinery,   labour   and   bull   sharing   with   the   partnership,  helping  further  control  costs.      Utilising  a  joint  venture  has  enabled  Adam  to  be  involved  in  developing  an  enterprise  that  he  would   not   have   been   able   to   establish   by   himself.     Leveraging   personal   capital   against   other  parties,   has   enabled   increased   gearing   of   the   business   while   leaving   potential   for   greater  returns   on   capital.     The   contract   farming   agreement   has   enabled   Adam’s   participation   and  business   growth   within   a   capital-­‐intensive   industry,   and   his   successes   again   show   the  importance  of  networking,  and  developing  key  practical  and  business  management  skills.    On  top   of   this   Adam   reiterates   the   importance   of   investing   in   assets   that   are   appreciating   in   value  while   the   business   is   still   developing,   and   avoiding   wasting   money   over   capitalising   the  enterprise  by  investing  in  “bells  and  whistles”.  Matthew  Ingram  A   new   entrant   from   a   non-­‐farming   background,   Matthew   was   first   drawn   to   farming   though  involvement   with   his   school   farm.     After   completing   a   HND   in   agriculture   he   proceeded   to  spend   a   year   in   France,   studying   the   problems   and   opportunities   facing   new   entrants   over  there   before   returning   to   the   UK   to   obtain   a   Diploma   in   Advanced   Agricultural   Management.    Following  this  he  spent  a  couple  of  years  working  as  a  financial  advisor,  an  experience  which     61  
  • 62.  gave  him  a  strong  financial  and  sales  background,  but  also  reinforced  to  him  that  he  waned  to  farm.      Taking  a  job  as  a  herdsman,  Matthew  continued  to  develop  his  existing  practical  skills,  all  the  while   applying   for   County   Council   Tenancies.     In   hindsight,   he   now   recognises   that   failing   to  obtain  a  tenancy  was  one  of  the  best  things  that  could  have  happened  to  him  as  it  meant  that  when   the   opportunity   arose   to   become   a  self-­‐employed  contract  manager,  he   was  able  to   jump  at  the  chance  and  was  placed  in  a  position  of  having  control  and  management  of  a  dairy  herd.  After  a  number  of  years,  and  having  developed  a  track  record  with  the  landowner,  the  landlord  approached   Matthew   with   the   offer   of   entering   into   a   contract   farming   agreement.     Having  spent  many  years  rigorously  saving  and  “managing  personal  accounts  like  a  business”  Matthew  was   is   a   strong   financial   position,   and   in   2004,   with   the   help   of   family   support,   was   able   to  purchase  the  cows  and  machinery  on  the  farm.    A  10-­‐year  term  was  agreed,  and  all  being  well  will  be  continued  upon  its  completion.      Matthew’s   story   illustrates   the   importance   of   saving,   building   credibility   and   developing   a  proven   track   record.     While   not   every   new   entrant   will   have   the   benefit   of   family   financial  support,  it  is  likely  that  any  new  entrant  in  Matthew’s  position  with  strong  financial  records,  business  acumen  and  technical  ability  would  be  able  to  find  a  lender  willing  to  provide  start-­‐up  finance.    Additionally  Matthew  speaks  highly  of  the  Wye  Graze  Discussion  Group  of  which  he  is  a   member,   the   benefits   of   information   sharing   and   the   importance   of   learning   from   others  while  new  entrants  seek  to  develop  their  own  enterprise.     An  anomaly  Charlotte  and  Ben  Hollins  The   author   Colin   Tudge,   describes   Ben   and   Charlotte   as   being   “absolutely   geared   towards   a  different  model:  an  enlightened  agriculture”.  While  they  may  not  be  first  generation  farmers,  and  indeed  are  farming  land  that  was  farmed  by  their  father,  they  effectively  found  themselves  in  a  situation  similar  to  that  of  a  stereotypical  new  entrant  when  their  landlord  sought  to  sell  Fordhall  Farm  in  2005.    Given  until  July  2006  to  raise  £800,000  to  buy  the  farm,  they  established  Fordhall  Community  Land  Initiative  in  2005  and  proceeded  to  sell  7,500  £50  shares.    Through  hard  work,  determination  and  national  press  coverage   (with   The   Guardian   and   Telegraph   between   them   reckoning   they   were   responsible  for  raising  £400,000  worth  of  shares)  they  were  able  to  raise  most  of  the  required  amount,  and  with  the  assistance  of  a  further  loan  became  England’s  first  community  owned  farm.     62  
  • 63.  Fordhall  Farm’s  current  structure  facilitates  individual  involvement  in  the  project  at  a  variety  of   levels;   from   a   hands-­‐off   shareholder   to   the   more   active   involvement   of   volunteers.     Social  events   further   public   engagement,   drawing   in   support   for   the   mixed   livestock   farm,   and   the  140-­‐acre  site  and  its  butchery  now  provide  employment  for  4  full-­‐time  staff  equivalents,  selling  products  through  a  farm  shop,  online  and  at  farmers  markets.  Although  they  have  been  held  to  be  an  anomaly  within  this  study,  this  is  purely  because  they  could  not  easily  be  fitted  into  any  of  the  groupings  used  for  this  project.    However,  there  are  certainly   aspects   of   their   success   that   are   replicable   by  other   new   entrants.     Charlotte   suggests  that   “for   those   people   thinking   about   starting   a   community   project,   my   advice   would   be  communicate,   communicate,   communicate   –   as   much   and   however   you   can”,   and   amongst  other   things   the   farms   success   clearly   demonstrates   how   ambitious   and   proactive   young  farmers  have  the  capacity  to  engage  with  the  community,  and  access  non-­‐traditional  sources  of  capital.               63