It’s no secret that agribusiness has come under financial pressure in recent years. That’s why it’s so important that professionals in the sector look for different ways to cut their costs. Here are some ideas.
Look For Second-hand Farming Equipment
Brand new farming equipment is becoming ever more technological and expensive. And while that’s great for productivity, it;’s not so good for your capital budget. Sensible businesses won’t consider the new equipment that gets shown off at agricultural shows every year. They’ll also ask themselves whether using second-hand is a viable alternative. Second-hand equipment is often refurbished, but it doesn’t come with all the associated costs of buying equipment brand new.
Switch To Red Diesel
Not many farmers know this, but there are in fact two types of diesel they can use for their farm equipment. We’re all familiar with white diesel, the type we ordinarily use. But there’s another kind of diesel, called red diesel, which is the same as white except for the color and the price. The original reason why red diesel was dyed was to mark it out as different from white diesel so that people couldn’t use it in their farm equipment. But back in 2013, the law changed. And now farmers are free to use a red diesel supplier to source diesel for their machinery. Since it’s cheaper than white diesel, it makes sense to make the switch.
Set Up Secondary Operations
Agribusiness doesn’t just have to be in the business of planting crops and growing meat. It can also be in the business of hospitality. In fact, hospitality is the one major area of growth the agricultural sector has seen over the last decade. And thanks to people’s interest in the countryside, that growth looks set to continue. There are plenty of options available to businesses in the sector. You could open up a hotel or a bed and breakfast. Or you could host a campsite, especially if you live in an area of outstanding natural beauty. Finally, you could set up a side business, selling produce from your farm directly. Homemade, bespoke ice cream is a product proving to be very popular at present.
Hire Out Machinery You Don’t Use
If you hold an extensive inventory of machinery you don’t use at certain times of the year, look for opportunities to hire it out. Hiring out machinery can often be a great money spinner for agribusinesses. Advertise the fact that you have machinery to rent on social media or through an online platform.
Invest In Energy Efficiency
As well as using cheaper energy, there’s also a case to be made for using the energy that you already have better. Most of the energy that farmers use is gobbled up by their farm machinery. And so that would suggest that the way that this machinery is operated has a bearing on fuel costs. Agribusiness can reduce fuel costs by making sure that the throttle is kept in the right position. And they can make sure that the vehicle itself is in an appropriate gear for the task at hand.