East of Scotland Agritourism Monitor Farm

East of Scotland Agritourism Monitor Farm

Meeting 2 - “Heads on Beds”

Peel Farm, Lintrathen, By Kirriemuir, Angus, DD8 5JJ

Over 40 Members of the Agritourism Monitor Farm Community Group at the second meeting

posing questions to members of the Rural Affairs Select Committee who visited the project.

Report from meeting 2held on Monday 4th August 2014

Introduction to the Agritourism Monitor Farm Project

Scottish Enterprise, supported by Scottish Government Skills Development Scheme funding, is leading on two agritourism monitor farms, one in the East (Peel Farm) and one in the South of Scotland (Laggan Farm). Both Monitor Farms will highlight to a rural tourism audience the opportunities and challenges of managing complex tourism businesses while also running productive farming enterprises.

Visit from Scottish Government Rural Affairs Select Committee

MSPS from the Rural Affairs Select Committee came to Peel Farm and met with the Fleming Family, Kim Gall, and representatives from the Monitor Farm Management Team.

MSPS also visited Laggan Farm and met with the McConchie Family, Jackie Green from Scottish Enterprise, the Project Manager and Peter Beattie, Project Supervisor.

The Rural Affairs Select Committee MSPSs who visited both farms had a discussion with participants around the fact that

Agritourism is a sector in its own right, with about 1000 businesses in Scotland generating £100 million direct at present
It can generate economic stability for a farming business by generating cash, keeping family members from different generations on the farming unit, creating employment in the local area, engaging consumers of Scottish food and drink directly with farmers as producers and attract a new tourism sector of International tourists to Scotland
In light of reducing subsidies on farms, Agritourism gives some farmers the opportunity to add value to their farming asset and supplement farming incomes
Agritourism is not represented in government currently in terms of policy resource
Agritourism linked to regulations on the use of (only) local (county) produce and Scottish produce exclusively could help to differentiate the sector and generate benefits for the food and drink sector
SRDP in the next 5 year round looks set not to be able to deliver the diversification support that farmers had access to in the last round, particularly in diversification into Agritourism (however discussions with the sector and Scottish govt are ongoing)
Knowledge exchange, access to data and support from peers to provide business confidence within Scotland and between Scotland and other parts of the world is essential to allow growth & investment in the sector

MSPS encouraged those attending to keep in touch – contact details in link above.

Theme of Meeting

The theme of the meeting was “Heads on Beds.”

Those attending were given some background on the new accommodation which represented a £320k investment, obtaining a £160k SRDP grant.

The Fleming Family shared the business plan for the project which had been undertaken by SAC to obtain the grant. Euan Hart of SAC came to the meeting and explained about the project.

Working Groups Feedback

GROUP ONE - Added Value Opportunities for new accommodation

Positioning as an Agritourism business
Name – Peel Farm Holidays, a Luxury Agritourism Experience
Linking the whole experience of the farm, farm shop, home cooked farm produce to the experience
Not positioning or mentioning as ‘self-catering’
Visit Scotland grading for Agritourism which describes accommodation on farm where food and drink from farm and local area integral part of experience
Short break packages with Jam Making lessons as part of break – pick berries, make Jam, take home jam
Short break packages with Cake Making, decorating, home baking lessons, how to cook steak lessons – story of farm, then activities in workshop as part of stay
Short break packages with high tea one or all of the nights, breakfast in the coffee shop, home produced “ready meals” in accommodation = Foodie Breaks (How about Farmer Fleming’s Foodie Breaks?)
Short break with farm tour included – story of Claire’s beef cattle
Include nature trail and children’s play as part of stay
Create and book packages online
Book food and drink online ahead of stay – ambition to drive as many people to stay without going to supermarket to do their shop ahead of their stay = buy all their food and drink from Peel (sold as making it easy for them, finest food etc)
Packages which include other local providers and integrate into existing events and activities e.g. Golf at Alyth Golf Course, Walking Festival
Packages designed for field sports enthusiasts, children, skiers etc
In summary cross-selling and integrating as much between existing business and new accommodation as possible + also cross-selling and integrating with other QUALITY local providers
Opportunity to offer food and drink packages to other local accommodation providers e.g. stay two nights nearby and have high tea at Peel Farm as part of your stay

GROUP 2 - Sales and Marketing Channels for new accommodation

High quality photography is essential with real people in the photos
Business plan had plan to use agency for all sales and marketing e.g. Hoseasons
Discussed pros and cons for using all agency versus own sales and marketing

Agencies

Hoseasons 22% or 19% commission if you are in the National Park (Claire isn’t)
Cottages and Castles 17.5% commission

Essentials - Own Website and Trip Advisor

Start separate Peel Trip Advisor for hotels/speciality lodging
Trip Advisor Reviews easily visible on website
Include translation tools

Sales Channels

Free listing
Go Rural £250 plus VAT for package for lobbying, data, business to business and marketing per annum
Farmstay
Trip Advisor’s Holiday Lettings 3% commission or £359 per annum excluding VAT
Angus Ahead Free listing
Love to Escape
Home and Away
Laterooms 17% commission but good at getting rid of last minute availability
Itison – good for getting started selling many rooms, but will require to be for ½ price

Peel should be making the most of PR surrounding being the monitor farmer
Competition to win a stay with local radio, newspaper etc
Opportunity for a competition in association with Mackies (via Go Rural)

Activities which need some financial investment and time

Website – Peel Farm has existing website which needs enhanced
Need online booking
Recommendation not to have two separate sites as confusing and time consuming for consumer
Email marketing template – use mailchimp – weekly e-news to combined database for farm shop and accommodation

Activities with no Commission, no cost, but need time

Facebook
Twitter
Instagram
Linked in
Pinterest
Email newsletter to existing Peel Clients and accommodation clients
Unanimous feeling to keep existing Peel Farm social media channels and use that to promote, do not start new separate social media or website for accommodation

GROUP 3 - Cost Budgeting for Accommodation

The budget undertaken for the grant application required to be updated to reflect actual costs going forward now that the accommodation has been completed.

The budget in the grant application is set out on the next page.

A discussion was undertaken regarding costs missing from the above table –

Depreciation
Laundry costs/Laundry hire (£3000 per annum?)
Gardening (£1000 per annum?)
Online booking system charges (2.5% per transaction)
Bank charges
Management Costs
VAT

Each budget line requires to be reviewed, costs researched and updated.

Following the meeting, Claire will update the costs and circulate this around those who attended for comment. Angus Council have offered to support Claire with a business advisor to research and update the budget for the accommodation following the monitor farm meeting.

Year 1 / Year 2 / Year 3 / Year 4 / Year 5 / Comments
From
Meeting
2013 / 2014 / 2015 / 2016 / 2017
Expenditure
Rent/rates/water / 1968 / 1968 / 1968 / 1968 / 1968
Light/heat/power / 1200 / 900 / 1000 / 1000 / 1000 / 1500 p/a?
Repairs/rewewals / 3600 / 3600 / 3600 / 3600 / 3600 / Yr 5 refurb
Advertising/marketing / 1000 / 1000 / 1000 / 1000 / 1000 / 10% of sales
Salaries/wages / 1800 / 1800 / 1840 / 1840 / 1840 / Cleaning
Operations
Management
Telephone/postage/stationery / 200 / 200 / 100 / 200 / 200
Advertising/marketing / 500 / 500 / 500 / 500 / 500 / In twice
Loan interest / 3800 / 3800 / 3800 / 3800 / 3800
Visit Scotland etc fees / 500 / 250 / 250 / 250 / 250
Professional Fees (accountant & legal) / 500 / 1900 / 2000 / 2000 / 2000
Sundry Expenses / 1340 / 1340 / 1340 / 1340 / 1340
Holiday Cottages Commission / 6534 / 6711 / 7944 / 7944 / 7944
Trading Expenditure / 23442 / 24669 / 26092 / 26192 / 26192

GROUP 4 - Pricing Strategy and Sales Projections for Accommodation

The main discussion was around how low the income projections were.

The new accommodation should achieve 5 star grading from Visit Scotland.

One unit sleeps 4 people, the other sleeps 8.

Key discussion points and actions

Need to establish base rates for the accommodation
Research other 5 star rates for similar accommodation for 4 and 8 person accommodation
Key point was that consumers no longer looking for week stays but short breaks
Consider offering one night, 24 hours, 2 or 3 day breaks and the rates for these breaks
Consistent annual published rate with seasonal packages versus seasonal rates which you can’t discount from
Strategy for pricing to build customer base to start off business required
Great opportunity with existing farm shop customer base to fill the new accommodation with guests

Year 1 / Year 2 / Year 3 / Year 4 / Year 5
2013 / 2014 / 2015 / 2016 / 2017
Income / 28409 / 29180 / 34540 / 34540 / 34540
Net Profit / 4967 / 4511 / 8448 / 8348 / 8348

Outcomes from the Meeting

Following the meeting, Claire and Caroline met to go through the feedback and following up on the discussion points. The following actions were agreed for Claire and Kim, which Caroline and the rest of the monitor farm community group would provide support for.

Name – Peel Farm Holidays, (with strapline), a Luxury Agritourism Experience
Budget to be updated and business plan produced for the accommodation business which dovetails into the rest of the business. Support has been offered from Angus Council for this. The core 10 benchmarking businesses on the project could also assist with the new budget. The updated budget will be circulated around those who attended for feedback ahead of the next meeting.
Website – a new website for Peel Farm using the Go Rural template for agritourism businesses with support from Go Rural for this pilot.
Claire to fix standard rates for accommodation. Caroline and Claire discussed nightly rates through to two week stays.
Claire to arrange photographer for pictures.
Kim to cost out added value activities such as Jam Making, Cake making, cake decorating crafts for guests, food and drink hampers, meals at the café.
Claire to cost out holiday package incorporating the above activities and also food and drink hampers, meal options.
Staff training for all Peel staff regarding the accommodation and guests arriving/visiting. CAM to support this.
Claire to arrange appointment with Hoseasons with view to putting the 8 berth property into them and see how this goes. Leave 4 berth property outwith Hoseasons.
Claire will list with the sales channels agreed at the meeting. With regards to the farm shop and Peel Farm Holidays – there will be 2 separate Trip Advisors, 2 Facebooks but with same posts going up on each, 1 x Twitter shared account.

Support has been offered from Angus Council for the Monitor Farm project with benchmarking.

Key Opportunities & Issues in the Business which will form the focus of future meetings

8 will be picked for future topics

The topics for each meeting will be selected by Kim, Claire and by the project Management Group. They will combine with other topics from the South of Scotland Monitor Farm to provide a picture of issues and opportunities that are important to the Scottish Agritourism Sector. The future topics for the next three meeting dates will be published in advance.

Measuring, understanding our own performance and acting on it – picking which Key Performance Indicators (KPIs) to measure
Business strategy
How do we make more profitin the agritourism businesses?
Benchmarking against other similar businesses in sector – how does Peel compare? What are the best doing that Peel could learn from?
The relationship between “Farmer”& “Tenant” how do you make it “win win” for both The Fleming Family and Kim?
Developing the Peel Farm Brand, experience and products – what does Peel brand stand for?
Focus on Farm Retail – positioning of Peel food and drink, other food and drink, measuring return by m2, display and appearance
Focus on Production Unit and Workshop area – how to maximise return on capital and create maximum sales/usage
Focus on new Accommodation – how to maximise return on capital and create maximum sales/usage
Developing Peel as a destination to create volume of sales – an overall Angus Agritourism Experience!
Market Segment review – what markets are Peel in? What markets should Peel be in? Wants and needs from different markets
Pro-active sales
Succession in the family business
Investing in farm tours and children’s adventure playground, nature activities, how we get a return on these?
What do customers think of Peel? What do the local population think of Peel?

Key Project Information

Key Facts :

The project will run until autumn 2015.
The outputs will include 18 on-farm meetings across the two Monitor Farms.
Two core business groups sharing data and information will be established.
An interactive Monitor Farms website at shares meeting reports and other publications.
The aims of the project will be to improve the business performance and offering of the two Monitor Farm businesses and encourage participation by attendees which will lead to measurable improvements in their own rural tourism businesses.

The launch of the project was held at Peel Farm near Kirriemuir in Angus in May 2014.

Who’s who at Peel Farm

Claire Fleming Kim Gall

Claire and her family own Peel Farm and as well as running the farm and another farm nearby, the family are about to open a new luxury accommodation business on the farm. Claire’s mum Frances set up the farm shop and coffee shop as a diversification 30 years ago.

Kim Gall runs the coffee shop, farm shop and a food production site. Kim leases the business from The Fleming Family.

For more information on Peel Farm and for a Factsheet visit

What does the Peel Farm Agritourism Business consist of?

A coffee shop seating 54
A farm shop consisting of the sale of home produced beef, lamb and pork, other Scottish produce as well as arts, crafts and gifts
A new production facility which can be rented out to people wishing to produce their own food and drink for sale
A meeting room area ideal of small parties and workshops
New luxury accommodation in a converted barn opening August 2014

Management Group

The Management Group for the Peel Farm Monitor Farm consist of a small number of people interested in developing agritourism in Scotland and supportive of Peel’s desire to grow their business. They will act as a support to the Fleming Family, Kim and the project overall.

The Management Group for the Peel Agritourism Monitor Farm include Claire Fleming, Kim Gall and -

Nikki Pollock, Ardross Farm Shop
Louise Nicol, Newton of Fotheringham Farmhouse B&B
Norma Bertram, Food and Drink Consultant
Jim Clarkson, Director, East of Scotland, Visit Scotland
Alison Smith, Head of Economic Development Angus Council
Linda Tinson, Director of Rural, Ledingham Chalmers

Core 20

The “Core 20” consist of 10 agritourism businesses committed to attending all of the Peel Farm Monitor Meetings and 10 agritourism businesses committed to attending all of the Laggan Farm Monitor Meetings. These 20 businesses will be given additional support by meeting 4 times ahead of the main monitor farm meetings to discuss how to improve their own business performance. One of these meetings will be a joint day meeting going behind the scenes in Glasgow’s top hotels to understand the dynamics of running a City based hospitality business. If you would like to involved please contact Caroline Millar

Finding out more –

Project Facilitator – Caroline Millar, Go Rural

Tel 01382 320 777 or Mob 07584 660 541

Project Supervisor – Peter Beattie, Momentum Consulting

Project Manager – Jackie Green, Scottish Enterprise

Date of next meetings –

Peel Farm Meeting 3: Tuesday 30th September 2014

Meeting topic“The Peel Brand -What is the experience? What is the USP? What is the brand?

Peel Farm Meeting 4:Tuesday 28th October 2014

Laggan Farm Meeting 2:Tuesday 19th August 2014Focus on the Café

Laggan Farm Meeting 3:Tuesday 16th September 2014

Laggan Farm Meeting 4Tuesday 4th November 2014

Ends – Caroline Millar

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