Farm Business Development Task 2010
(Some figures and information used in the task do not reflect actual farm details, but provide a hypothetical scenario for the competition.)
This year’s task for the national Farm Business Development competition is to submit a business proposal for the tender of the farm described overleaf. The application must include a rent tender, a business plan including cash flow and budget. Inclusion of pension provision will be looked upon favourably, as will any additional/necessary training for personnel working within the business.
The farm will be let on a Farm Business Tenancy for a Ten-Year Term commencing on 29 September 2010.
Competitors should demonstrate that their proposal will create a viable rural business. They should also demonstrate an awareness of available business/rural grants, diversification opportunities (and restrictions), as well as environmental and energy-saving good practice. Competitors are advised to refer to competitors’ and judges’ criteria as well as rules for the competition.
The submission can come from the perspective of a sole tenant or any form of business partnership including venture or share farming. As you were not farming in 2005, you have no Single Payment Scheme (SPS) Entitlement of your own. However, the landlord did make an application in 2005 and farmed through the reference period and will be expecting to maximize its financial advantage through the entitlement that it now owns. You will need to demonstrate a workable scenario that accounts for the legalities of the SPS, cross compliance/voluntary environmental managementand taxation. The farm has previously been under the CountrysideStewardship Scheme and Entry Level Scheme (ELS).
As part of the tender for Wrockwardine Farm, it will be favourable if you can demonstrate your ideas for a whole farm plan to support your business. This should include good practice in the management of soil, water, air, habitats, waste and Health and Safety. Competitors can view Defra’s Protecting our Water, Soil and Air: A Code of Good Agricultural Practice for farmers, growers and land managers
Competitors are expected to demonstrate the following:
- Aim of their submission
- Overview of business plan and available resources
- SWOT analysis of farm
- Business objectives
- Budgets to include cash flow, economic viability, gross and net margins
- Options for the future
- Development of new rural enterprises which could also generate local employment
- Awareness of future policy change (future CAP reform) to support business plan
- Sensitivity analysis
Competitors are advised to consult the Tenancy Reform Industry Group (TRIG) Code of good practice for agri-environment schemes and diversification projects within agricultural tenancies view the Shell LiveWIRE website via for support and information for business start-ups.
Wrockwardine Farm, Wrockwardine, Wellington,
Telford, Shropshire, TF6 5DG
1.Situation
The farm is situated on the western edge of Wrockwardine village which lies approximately two miles west of Wellington, Telford, and approximately 12 miles east of Shrewsbury. Wrockwardine Farm has been a tenanted farm and is now available for tender following retirement.
2.Description
The holding extends to approximately 218.44 acres comprising 180 acres arable, 14.80 acres pasture, 20.28 acres stewardship with the remaining areas down to woodland, farmyard and buildings.
There is a range of traditional and modern farm building on the holding located to the west and the north of the farmhouse. The farm benefits from a substantial and attractive farmhouse of brick under slate construction with accommodation comprising: kitchen, dining room, sitting room, family room, study, master bedroom with en-suite shower room, four further bedrooms and bathroom.
The soils are classified in the Soil Survey of England and Wales as falling within the Salwick series and described as “deep reddish fine loamy soils with slowly permeable subsoils and slightly seasonal waterlogging. Some deep well-drained coarse loamy soils. Some fine loamy soils affected by groundwater”.
A plan of the land is provided and a schedule of acreages.
3.Lots
Wrockwardine Farm is available as a whole or in lots.
Lot 1 - Land (shown edged red on the attached plan) - Farm Business Tenancy
218 acres of arable and pasture land together with a range of traditional and modern farm buildings to be let on a Farm Business Tenancy for a term of 10 years.
A plan and schedule of the Farm Buildings is provided.
Lot 2 - House (shown edged green on attached plan) – Assured Shorthold Tenancy
The farmhouse is a 5 bedroom period property with 2 reception rooms, family room, office, various stores to be let on an Assured Shorthold Tenancy for a term of 10 years.
The minimum rent for Lot 2 will be set at £9,000 per annum.
Please note: House will be made available to FBT tenant on the first basis through if not required will be let on open market
4.Single Payment Scheme (SPS) and Environmental Schemes
You have no SPS entitlement but the owner does have entitlement with full history (payment expected in relation to 2010 SPS claim is approximately £90.12/acre). Single Payment Entitlements will be available by separate negotiation between the outgoing and incoming tenant.
At the end of the tenancy the Landlord will have the right to acquire at open market value the SPS entitlements or any similar scheme in existence.
The holding has previously been under the Countryside Stewardship Scheme and the Entry Level Scheme although the outgoing tenant is negotiating the withdrawal from both of these due to retirement.
5.Nitrate Vulnerable Zone
The Land is designated as a Nitrate Vulnerable Zone (NVZ). The Tenant will be expected to comply with all rules and stipulations relating to the NVZ designation of the Land and shall provide to the Landlord at the termination of the agreement or on demand all relevant records including those relating to stocking rates, fertiliser and organic manure applications. The Tenant will be responsible for any further measures and investment needed to comply with the present of advancing regulations.
6.Sporting Rights
All sporting rights will be exclusively reserved out of the tenancy.
7.Farm Business Tenancy (FBT) Agreement
The successful applicant will be required to enter into a Farm Business Tenancy for term of 10 years. The tenancy will start on 29 September 2010. A schedule of condition will be prepared at the commencement of the agreement.
The Terms will be Full Repair and Insurance (FRI) on the FBT property. Insurance will be under the Landlord’s Insurance cover which will be re-charged to the Tenant. The tenant will be required to insure his/her property and to carry all statutory insurance cover.
The rent will be payable quarterly in advance.
All wayleave payments will be retained by the landlord.
The tenant will be responsible for all repairs.
The incoming tenant will be required to meet any Stamp Duty Land Tax that arises based on the chargeable consideration and the rate of tax that applies.
8.Assured Shorthold Tenancy
The farmhouse is offered under a separate lot from the agricultural element and will be offered to the successful farm tenant under an Assured Shorthold Tenancy at a minimum rent of £9,000 per annum payable quarterly in advance. If the successful farm tenant does not wish to rent the farmhouse it will be offered on the open market.
Insurance will be under the Landlord’s Insurance cover which will be re-charged to the Tenant. The tenant will be required to insure his/her property and to carry all statutory insurance cover.
9.Services and Rates
Single phase electrical supply to the farmhouse and three phase electricity to the farm buildings.
Mains water, electricity and private drainage.
The council tax band for the farmhouse is Band F and the charge for the year 1 April 2010 to 31 March 2011 is £1,944.89. The Local Authority is Telford and Wrekin Council.
10.Rights of Way, Easements and Wayleaves
The farm will be let subject to existing wayleaves, rights of way and easements. A public footpath runs across the holding.
11.Capital Requirement
Competitors will be required to show details of all their assets including live and dead stock and deposited money, together with their liabilities. For the purpose of this competition you are assumed to have a mortgage on a house worth £200,000, of which you own half of the equity. Again for the purposes of the competition you should assume to have £35,000 of your own money. From this basis you will need to demonstrate the financial arrangements for stocking and equipping your holding in accordance with your plan. Competitors will be required to produce budgets, cash flows and borrowing requirements for proposed business enterprises.
12.Viewing
Viewing days will be held at the farm on Saturday 17 April 11.30 am, Sunday 9 May 11.30 am and Sunday 6 June 11.30 am. All visitors will be asked to comply with Health and Safety requirements.
13Tender Procedure
In addition to the information required from the rules of the competition and the task details, you are advised to submit the following:
- A brief history of your farming experience and CV
- The rent offered
– for further on-line business start-up advice
Supported by
Farm Details
Schedule of Areas
Parcel / Hectare / Acres / Description0048 / 5.72 / 14.13
8242 / 2.56 / 6.33
1329 / 3.83 / 9.45
2421 / 0.81 / 2.01
Pt 3409 / 0.20 / 0.49
Pt 3409 / 0.21 / 0.52
Pt 3409 / 0.60 / 1.47
Pt 3409 / 0.08 / 0.20
0002 / 2.98 / 7.35
0014 / 5.98 / 14.77
5500 / 3.05 / 7.54
7587 / 3.47 / 8.57
1800 / 0.92 / 2.27
9100 / 0.07 / 0.17
9706 / 0.65 / 1.61
0064 / 2.12 / 5.23
7634 / 4.06 / 10.04
7300 / 3.59 / 8.86
4581 / 7.12 / 17.58
4200 / 3.85 / 9.52
5521 / 3.13 / 7.72
0005 / 11.04 / 27.27
2140 / 3.21 / 7.92
8918 / 2.59 / 6.39
0140 / 1.09 / 2.69
0131 / 2.06 / 5.08
3572 / 1.52 / 3.76
5933 / 0.90 / 2.23
4040 / 6.28 / 15.51
0026 / 2.36 / 5.82
5729 / 0.25 / 0.61
4525 / 1.39 / 3.43
Pt 3409 / 0.57 / 1.42 / House & Buildings
9723 / 0.07 / .18 / Road
Pt 0812 / 0.12 / .30 / Road
Total / 88.45 / 218.44
Schedule of Farm Buildings and Plan
BuildingRef / Measurement
(Metres) / Description
1 / 8.34 x 4.86
4.86 x 4.39 / General purpose two storey traditional brick building
2 / 4.85 x3.33 / Brick built covered area
3 / 7.25 x 4.85 / Brick built old byre
3a / 20.74 x 5.54 / Former dairy with loft over
3b / 4.8 x 3.2 / Pen
4 / 5.62 x 4.89 / Former bulk tank room
5 / 21.56 x 9.57 / Portal frame cattle building
6 / 11.46 x 5.06 / Former milking parlour with pit
6a / 8.65 x 7.35 / General purpose store
6b / 7.68 x 2.74 / General purpose lean to
7 / 16.57 x 5.45 / Traditional brick built building with pens
8 / 23.70 x 23.20 / Portal frame cattle building with block and space boards
9 / 8.70 x 6.83 / General store
9a / Grain bin
10 / 27.48 x 8.55 / Portal frame building with open sides
11 / 22.92 x 11.83 / Portal frame building
12 / 18.22 x 12.21 / General purpose timber frame building with space boarding
13 / 18.05 x 5.85 / General purpose timber frame building with timber cladding
14 / 18.36 x 5.84 / General purpose timber frame building with timber cladding
15 / 26 x 12 / Silage clamp with concrete side panels and concrete base
All measurements approximate