Keen to take maximum advantage of the opportunities on offer, but not always confident that they have the right management tools to use. That was the picture that emerged from a recent government survey of farming businesses in England.
The Farm Practices Survey 2018 asked a range of questions. These covered innovation; the use of data on market prices in decision making; risk management; the use of financial and management accounting software; and the prevalence of applications for grants and payments. The Survey found that 54% of farms had made key changes in the previous 12 months – often in the form of new or specialist machinery.
But better management was also on the list for farm businesses wanting to make changes. Some 10% of farms had looked to improve their management tools. HMRC’s Making Tax Digital (MTD) initiative was also specifically mentioned as a motivating factor. Many farms aimed to manage business risk. Among the top strategies mentioned were good business practice; business diversification; using market information on future prices; and creating financial forecasts. Significantly however, nearly half the businesses surveyed felt that they lacked the risk management tools they needed.
The survey also highlighted the role of the farm advisor. It found that advisors were often key in driving change – prompting innovation and suggesting sources of grant funding. A fresh look at financial management in areas such as cost control; cash flow; and the timing and financing of capital expenditure, will often create opportunities for better business management. We should be delighted to help you take stock of your farm management procedures.
This publication has been prepared by RRL LLP. It is to be treated as a general guide only and is not intended to be a comprehensive statement of the law or represent specific advice. No liability is accepted for the opinions it contains, or for any errors or omissions. All rights reserved.