IT WOULD be unwise of landowners to 'batten down the hatches' and assume that their current low delivering income streams are going to maintain their businesses.

According to William Fry, managing director of rural diversification advisers Rural Solutions (RSL), the 'only certainty' landowners should plan around is that traditional income streams will end.

“Now is the time to take along hard look at estate resilience and develop the right business strategy to reposition away from reliance on traditional incomes and invest in new enterprises in the countryside,” said Mr Fry.

His advice followed the firm's annual survey of UK estate owners that concluded there was 'increased confidence' in rural business, despite the current climate of uncertainty – 25% of respondents felt more optimistic about their business prospects now than at the start of 2019. Two-thirds planned to invest in a diversified enterprise and over 85% anticipate retained or increased income.

Compared to 22% last year, however, none of the respondents plan to diversify within farming and fewer than 4% are planning to start or expand a lease for agriculture. There was also a 10% decrease in plans to invest in further acreage.

Mr Fry said that land-based businesses were seeing the current uncertainty as a 'catalyst for action': “Enterprising, forward-looking landowners are committing to reshaping and repositioning their business to give it the best chance of thriving in a new era. Paradoxically, the greater the unknowns, the greater the confidence to take matters into their own hands.

"They have had time to digest that we are living in precarious times and they are not willing to rest on their laurels any longer. They have priced in the Brexit risk – they know agricultural support payments are on the decline, that attitudes to tenancy agreements, public good and planning consent may change – and they are ready to shift from a farming focus towards diversification trends in order to maintain profits.”

More than half of respondents (56%), which represent over 250,000ha of Scotland, England, and Wales, believed it was a good time to be investing in a rural business and a further 11% had committed to capital projects over the next 12 months to deliver alternative revenue sources.

Investment plans are weighted towards increasing the countryside’s role in work, wellbeing and pleasure, with 47% investing in commercial space, 40% in self-catering accommodation, 38% in residential lettings and 36% in events including festivals and weddings.

“Some of the top trends developing are health and well-being, co-working space, off-grid holiday retreats firmly plugged into mindfulness and more sophisticated rural visitor attractions,” said Mr Fry. “These need to be in the right location and right environment to have long-term success. It’s more than just thinking 'let’s start a farm shop'. It’s important to build a self-sufficient sustainable business that has commercial appeal and longevity. You need to look at the current business, the skills and assets already in the business, and what would complement and sustain these into a profitable future.”

Investment in existing renewable energy was down, but 21% of respondents planned to invest in new renewable energy sources.

James Thompson, who runs the Sansaw estate in Shropshire, commented: “It is clear that, whatever happens in the greater political and economic arena, it’s up to us to assert some control over the sustainability of our business and that’s why, despite – or perhaps because of – this, we feel confident to take bold steps now psychologically, strategically and financially to secure the future of the business. As landowners across the UK, we need to invest in growth and in jobs in the countryside, maximise on the natural capital and work with experts like Rural Solutions for long- term traction.”