Property
Six ‘easy’ benchmarks to get ready for Brexit
• Identify areas to make improvement • Prepare for end of direct payments • Look at how business is structured
A
rable farmers looking to get their business into best shape ahead of Brex- it are being encouraged to look at six ‘easy to calculate’ man- agement benchmarks as a use- ful starting point. “For some farmers, the word
‘benchmarking’ conjures up a dry and tedious process they’d rather not undertake – but it can be invaluable,” says Will Gem-
mill, head of farming at Strutt & Parker, who has devised six simple Key Performance Indi- cators (KPIs).
These KPIs can be calculated without needing to delve into the depths of farm accounts (see box). When used, they can highlight areas where costs savings might be found and where it might be benefi cial to dig deeper into the fi nancials.
6 Key Performance Indicators KPI
Cropped hectares per arable labour unit Litres of gas oil per cropped hectare Horsepower per cropped hectare Drilled hectares per metre of drill
Mean (average) 266
104 1.79 107
Cropped hectares per metre of sprayer boom 27 Combined hectares per metre of combine 79
Mr Gemmill says: “The fi g-
ures, which are based on data we have captured from more than 145 farms, ranging from 100ha to 2500ha, will give an indica- tion of how your farm compares in terms of labour and machin- ery costs and capacity.”
Improve efficiency Farm businesses need to be as fi t as possible to cope with the re- duction or even loss of direct sup- port payments – currently worth more than £200/ha. This means cutting costs and improving effi - ciency is a pressing reality, says Mr Gemmill. Strutt & Parker recently com- pleted a detailed benchmarking exercise for the AHDB Monitor Farms in England and Scotland. It involved reviewing labour and machinery costs to a level of de- tail previously unseen within ge- neric farm benchmarking. To help arable farmers review their current business operations, the fi rm is now offering detailed arable crop production reviews to
Calculating costs can pave the way for better farm performance, says Will Gemmill
other farmers. No two farms are the same, but calculating costs and considering the logistics of making a change can help im- prove performance.
Searching questions “Growers can get some answers to some searching questions,” says Mr Gemmill. “Would hiring a ma- chine be more economical for the hours it does? Could a contractor do the same job at the same cost? Or could sharing a combine with a neighbour work logistically?” One recent arable crop produc- tion review carried out on a 400
Clear strategy needed for farm support after Brexit
• Smooth transition needed for farmers • Substantial losses for farm businesses • Urgent need for improved IT systems
D
efra must set out clear paths and timelines for phasing out the basic pay- ment to farmers and introducing a new environmental land man- agement scheme, says the Cen- tral Association of Agricultural Valuers (CAAV).
In its response to the govern-
ment’s consultation on its propos- als to reform support for agricul- ture post-Brexit, the CAAV said it
72 ANGLIA FARMER • AUGUST 2018
was vital that farmers have time to plan and adapt to the biggest changes the industry has seen since 1945. CAAV secretary and adviser
Jeremy Moody said: “We are at a moment that this country has not had in 70 years, when we can de- termine policies that will support and enhance agriculture’s role as a creator of value for the econo- my and society.
Far-reaching changes “Confi rmation this year of the di- rection of policy and the paths and timeline for the transition of pay- ments will give farmers a frame- work in which to make their de- cisions.”
Creating a viable vision will require far reaching changes – not just simply phasing out the basic payment and shifting farm support to a new system large- ly based on rewarding farmers for undertaking environmental measures, said Mr Moody. “These range from taxation and tenancy law to research and knowledge exchange, stimulating
the people, skills and investments needed to deliver our goals so that we have a competitive and en- vironmentally successful farm- ing sector. The shift from direct pay- ments to largely environmental payments will see a very sub- stantial initial loss in margin for farms before consequent market adjustments, he added. “A posi- tive framework needs to be put in place as early possible to facil- itate future success.”
Productivity challenge Defra must take a long view – and manage the transition to help
[source: Strutt & Parker]
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