INDUSTRY COMMENT: THE RURAL SOLUTIONS SENTIMENT SURVEY
To better understand the changing landscape of rural businesses and communities, we recently conducted our first Rural Solutions Sentiment Survey.
Diversification is the future of rural businesses. An increasing number of rural business are aiming to branch out into additional areas in order to increase their income and provide stability for their future; allowing them to remain resilient during a period of uncertainty following the UK’s decision to leave the EU.
By analysing a strong cross-section of clients from both diversified and traditional estates, farms and miscellaneous rural businesses, we looked to create a positive discourse regarding the future of the rural economy.
We received an overwhelming level of response outlining people’s concerns and, more importantly, hopes for the future, giving us a unique and encouraging insight into the future of rural growth.
A PERIOD OF UNCERTAINTY
Perhaps unsurprisingly, land-based and estate businesses feel they are operating in a period of uncertainty. Over 85% of respondents stated that they feel they are facing more than normal levels of uncertainty over the next 12 months with just under half (48%) feeling that levels of uncertainty are high or very high.
Brexit, changing the farm payments system and national politics were cited most often as the key drivers
A POSITIVE FUTURE
Despite such high levels of uncertainty, land-based businesses and estates demonstrate significant resilience. Only one third of respondents said they felt less optimistic for the financial prospects of their business over the next 12 months than previously, with two thirds citing no change or that they are more optimistic than 12 months ago. We maintain that the next decade will bring massive opportunity for those willing to evolve and progress. It is a pleasing endorsement of our views that our clients feel the same way.
The good news is that this uncertainty is not dampening enthusiasm for growth or change. Over half of respondents to the Rural Solutions’ sentiment survey say they are planning to expand or diversify their business in the next 12 months (55% of respondents). Given the nature of our clients, contacts and friends, this is perhaps not surprising. It is a stronger view than that revealed by other recent surveys.
Most estate businesses planning to expand will do so via new leisure or tourism businesses. An industry which is predicted to grow to £257 billion by 2025.
RURAL SOLUTIONS’ REACTION
The findings of the survey are a reinforcement of trends our team sees every day. Few, if any, involved in the land and estate sector are feeling comfortable, yet the majority remain positive and many are actively looking for and planning to take and make opportunities to grow, often by diversification.
The high level of interest in rural leisure and tourism comes as no surprise; we are engaged in many projects across the country and are fully aware of the returns and benefits that investment in this sector can bring. The growing interest in developing residential property to rent rather than to sell is interesting and reinforces our understanding of many of our clients’ plans and wishes for new projects.
It is also fascinating to see continued interest in renewable energy (despite all the challenges associated with it) and something of a renaissance in interest in the development of commercial property to rent.