The shut-down and social distancing caused by the Covid-19 pandemic has changed societal behaviour in the short term and is likely to have long term effects on many activities that our businesses rely on. This article suggests what to considers when creating new income streams for your rural enterprise. So, whether you are looking to exploit a new opportunity or ensure that your existing business remains resilient for the medium term, now is the time to start considering the way forward for you and your business.
A good business will regularly review the social and economic markets within which it operates to consider opportunities and threats, planning accordingly. However, very few businesses could have foreseen the pandemic and the effects it has had on our lives. So now is the time to look at your assets and each enterprise in order to understand how those assets may best work for you.
If you are unfortunate enough to have been severely impacted by the rapid change in markets, such as withdrawal of milk contracts, then those issues need to be addressed first. If your boat is sinking, plug the whole to live another day.
It is still important to find the time to plan and consider the way forward. Can your existing business find other markets or alter its product in order to do so? Once the business has been steadied then consider the wider options.
Use your staff, family, trusted advisors and friends to list the interests of those involved in the business. An outsider’s perspective can help create new lines of thought. Then list everyone’s ideas. It doesn’t matter how silly or half baked the idea is, jot it down. A relaxed atmosphere will help ideas flow. One person’s’ ideas will spark new lines of thought.
Include adaptations and extensions to the existing business, as well as brand-new opportunities. Once you have a long list, divide all of the ideas into categories. The categories should be of your own making, but may be something like:
Now you have a list of potential enterprises, ordered into groups, consider the assets that the business has. Look at the assets in each class:
Real Estate – Land, buildings, amenity
People -their expertise, interests and strengths
Cash – access to it
Clients or customers
Locality – Special features, access, etc
Move on to considering the financial implications for the ideas that look most realistic. Ensure you understand the opportunity costs. Factor in rent for buildings and salary for staff, including yourself. Involve your management team and the professionals around you. It is important to check on issues such as the affect on your tenancies, tax implications, business rates and business structures. For many organisations reputational risk is also a key consideration.
In my 30 years’ experience in the rural property sector I have seen moribund woodlands, which attracted antisocial behaviour, transformed by holiday lodges and burial sites into pleasant, conservation rich habitat…profitably. Equally, farm businesses can be revitalised by direct selling, the creation of offices or a new enterprise. Opportunities will have changed post Covid 19, but there are exciting, rejuvenating businesses and operations that can be created in the rural sector.
©Iain Skinner 2020