More and more farmers and landowners are looking to add value to their existing farming enterprises.
The ideas have been thought out, the planning application has been submitted and the banks have been contacted.
However, one area which is often given little, if any, consideration in these pre-planning stages is the feasibility study, finding out if there is actually a market or need for your product or service.
Barbara Huddart, Managing Director of Glendale PR and Marketing, based in Wooler, has completed a plethora of feasibility studies over the years, from accommodation businesses to food products such as rapeseed oil, ice cream, cheese and puddings.
Many of these have both national and international reputations, and the key to their success has always been the same, planning and research, finding out the facts and demonstrating if there is a need.
Ms Huddart, who regularly completes advisory sessions with agricultural students at Newcastle University, said: “Without proper research, a burgeoning business cannot know which markets the product will suit, who will buy or use the offering, and therefore the best places to market the new product, all of which are essential parts of launching a new business venture.
“It is imperative that you do your homework and establish the following; Is there a market for your product? Who are your competitors? Who are your customers going to be? What price do you need to charge?”
In-depth research is a must and often the best way to launch a new food product is to first trial it at a local farmers’ market by offering samples of your produce. After all, if these customers don’t like it, then chances are the rest of the crowd won’t either.
“It is quite a common mistake people make when starting a new business,” said Ms Huddart. “They have a product, some perhaps taking years to complete and perfect, and then they cannot see the wood for the trees.
“It is important when you have completed your research to review it and ask yourself: Are you offering what the customer wants or do you need to change or upgrade your product or service idea to make it more attractive/saleable? What is going to be your competitive advantage? Where are they going to be based?”
A classic example of this is accommodation. Plenty of farms have barns ripe for conversion into a potential holiday rental business, especially in the Northumberland area.
Knowing what the tourism trends are predicting going forward, the annual average occupancy levels and what the competition is doing are all important factors to consider.
Having all of this information will help you to establish the type of facilities likely to be needed in order to satisfy market demands. Analysing occupancy levels in detail will give you an idea of the potential for the annual income you can expect to generate.
Ms Huddart said: “Any farmers looking to diversify and start a new business should take time to fully complete their research.
“Specialist and trade magazines often carry specialist industry reports. Dedicated industry events, forums and conferences are also very good sources of information. Getting the offering and the product right is essential, and the only way to do this is to first carry out a feasibility study. This meticulous planning in advance will help to prevent poor performance.”