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UK dairy podcast shares top tips on starting a dairy business

19 August 2020

A dairy farmer from Staffordshire says attending specific dairy courses and joining discussion groups were a vital part in equipping her and her husband with the skills to run their own business.

Liz Haines and her husband Nick first joined the dairy industry in 2014 when they took on a 10-year contract farming agreement in Shropshire. As first-generation farmers, the pair were enthusiastic setting themselves tough goals.

With no background in running a farming business, the couple taught themselves some of the basic aspects such as budgeting, as well as attending training courses which helped them with the strategic planning.

One of the most useful courses Mrs Haines recalls attending was the Entrepreneurs in Dairying course in 2014, when they were just six months into their contract farming agreement.

Speaking during the dedicated dairy podcast The Milk Digest, Mrs Haines said: “Entrepreneurs in Dairying covered some really important content on running a business. There are not a lot of other courses out there like it.

“When we attended the course, we were six months into running our own business and the course gave us the confidence to look at what we were doing.

“We applied some of the negotiation skills and it was interesting and inspiring to hear from other case studies about what they had done.

“Having a bank manager (at the course) was also interesting as they told us what a bank wants from you if you need to borrow money,” she added

The couple also learned some valuable lessons from the start after their entry into farming coincided with the milk price crash. “It turned out to be the worst and the best thing that could have happened. It was invaluable as it really made us look at our costs,” she said.

After just six years into their contract farming agreement, they had outgrown the business having built up enough capital from the business. In agreement with the landlord, they were able to get out of their contract.

In the past year, they have secured a tenancy with two other farming partners on a farm in Staffordshire. They each have equal shareholdings with the Haines managing the farm on a day to basis. The herd they are running is being moved from an all year-round high input system a block calving grazing system. They are building a new parlour and next year the plan is to milk up to 400 cows with the focus on getting more milk from grazed grass.

For new entrants into dairy farming, Mrs Haines recommends the following pointers:

  1. Do your homework when signing contract farming agreements. The longest length contract may seem ideal but goals and personal circumstances can change during that time. It is important to look at the get-out clauses closely.
  2. Look at what the contract agreement offers. There are a whole range of different entry levels from the basic level where you are just providing the labour through to others where you can invest in the business.
  3. Join a discussion group/ attend courses. They are a good way to share ideas, learn from others, and keep abreast of what is going on.
  4. Do your homework. Make sure you are happy with your landlord and you have the foundations to form good relationships. For that, it is important to understand their goals and visions from the start and make sure that it fits with yours.
  5. Do not be afraid to pay for some good advice. This is not always needed but there are circumstances where paying for some expert advice can be worth it.
  6. Be mindful of exit clauses in contract farming agreements

This year the Entrepreneurs in Dairying course is running virtually. The course is designed to offer specialist instruction focusing on business efficiency and the key factors involved with working and running a dairy farm as well as providing delegates with the ability to network and form mentoring partnerships.

The 10-day long course delivered between October and December, will cover topics such as understanding the milk market and supply chain, tax and trading, people management, business planning, finance, and future opportunities.

Applications must be in by 31 August 2020 with numbers restricted to 50. Applicants will be selected by the end of September. The programme is managed by the Royal Association of British Dairy Farmers (RABDF) in collaboration with AHDB Dairy, the NFU and The Andersons Centre and is sponsored by HSBC UK.

The fee for attending the intensive training is £325 which will include a final two-day session involving a farm visit and a day at NFU’s Headquarters at Stoneleigh Park, Warwickshire. Click here to find out more.

Click here to listen to the full interview with Liz on The Milk Digest.


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