Preparing for Brexit and the loss of the Basic Payment Scheme is causing businesses to rethink the way they have been operating. Many are focusing on finding efficiencies, diversifying into new areas or restructuring the businesses. So what are the opportunities for your business?
Business Planning and Succession
Having a five-year business plan of how to replace the BPS income is a good start. Be realistic, set out key goals and targets, and – if the timing is right – look at handover plans to the next generation.
“Making a business plan can seem daunting to some and unnecessary to others, but it does help focus on what needs to be done,” says Andrew Troughton, Managing Director at Carver Knowles. “It doesn’t have to be complicated, but a frank review of where the business is is an important start.”
Benchmarking costs (without BPS)
Although it’s hard to foresee what Bexit will bring, having a good handle on costs and income allows areas of weakness to be identified and targeted. Break the analysis down into individual enterprises so a proper comparison can be made.
Develop new income steams
There is no single answer, but examples include:
- Using existing machinery to do contract work
- Letting units for commercial storage
- Part-time off-farm job
- Tourism ventures
Foreign labour is already under pressure and looks like it will tighten in the short term. On-farm research and development may lead to innovation to save labour and there are significant tax breaks for this sort of expenditure.
Infrastructure and buildings
Reviewing where physical limitations are often reveals a need for better infrastructure and farm buildings, which can improve efficiencies and allow businesses to grow. “It’s important to think long-term so consider the position, size and future uses of buildings as well as what the business needs now,” says Andrew. “Planning applications need to be carefully put together but we find that, where the need for development is properly stated, there is generally support.”
Although there is no tax relief for new farm buildings, the fittings, fixtures and any infrastructure can qualify for 100% Annual Investment Allowance so it is worth carefully itemising expenditure and discussing with your accountant.
If you would like to how we can help your business please call us on 01684 853400