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Moving forward - Farming & Agriculture business during COVID-19

The COVID-19 pandemic has had a major impact on how people purchase food. The need for social distancing has led some to step away from supermarkets and explore alternative sources for certain grocery items. This has opened the door to some niche opportunities for farmers.

Though farm businesses have not typically been set up for direct sales in the UK, many are now exploring options such as egg vending machines, while milk vending machines on dairy farms, which became popular in recent years, have seen a boom in interest in recent months. Dairy farmers are also increasing their delivery rounds. Some farmers have even taken the opportunity to expand the range of products they sell through vending machines, providing locals with a “one-stop shop” for staple foods.1

This alternative method of selling produce has proven advantageous for some farmers, as they can make better profit margins than they would when compared to selling to a supermarket. It also cuts out the delivery process, eliminating another cost factor that many other businesses are now having to rely on more heavily.2

In addition, growers who previously relied on farmers market stalls for the bulk of their income are now diversifying into fruit and vegetable box deliveries to help bridge the gap.

However, all of these adjustments come with a trade-off: as well as the obvious initial capital expenditure, vending machines could potentially lead to increased risk of virus spread on the farms form the extra public traffic, and deliveries an increased risk of staff illness.

Precautions

As well as opportunities, COVID-19 has brought about the need for extra vigilance. Lockdown brought an increase in the number of walkers and cyclists in the countryside. Often, they are opening and hopefully then closing gates that farmers use daily. Extra sanitation is required here. Also, workers should continue to sanitise machinery used by multiple operators, and consider limiting operators to certain machines where possible.

You should be mindful of an increase in fly tipping due to the closure of rubbish and recycling centres, with reports showing a rise in fly tipping of up to 300% in some areas.3 Ensure that your current agricultural insurance cover includes an extension for cost of clean-up and removal.

Moving forward

If you’re exploring a new customer mix to take advantage of those shying away from supermarkets, there are many things to consider – the inevitable expenditure, the longevity of customers’ current attitudes to avoid big stores, and the risk of spreading the virus to yourself and others on the farm. For many, the possibility of seeing the mark-ups normally reserved for the supermarkets may prove attractive enough to explore the possibilities.

It is undoubtable that all businesses will continue to experience the consequential side-effects from COVID-19 in the months and years to come, as we adjust to a “new normal” in the “suppression” phase of the virus. For more information and guidance on managing your business going forward, see our Post Pandemic Preparedness Report where you can also download a Marsh COVID-19 Return to Workplace Guide to help you get back on track. 

Sources

1. fwi.co.uk/feedthenation-farms-frozen-beef-vending-machine-a-hit  
2. theguardian.com/meat-and-veg-vending-machines-do-roaring-trade-in-coronavirus-crisis 
3. circularonline.co.uk/rural-police-fear-greater-criminality-in-the-waste-sector/ 

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