Farm Diversification

There are three possible markets:

• Primary farm catering:- B & B, evening meal, tea room/cafe, restaurant. Value for money essential with traditional and speciality dishes.
• Processing:- sandwiches, occasion cakes, meat and fruit pies, freezer fill.
• Off-site catering:- parties, charity functions, weddings, christenings, funerals.

Location is critical for tea room/restaurant. Professional well-lit signposting, both approaching and on-site, is essential, but costly.

Adequate parking. Play and interpretive areas, subject to market segment.

Inviting rustic charm image. Preferably a dedicated kitchen with separate clean and dirty task areas, free from personal clothing and laundry, dust, odour, pets and pests, chemical and water contamination.

Consider essential services. Consult Environment Health Officer when designing premises.

Dependent on existing facilities and personal contacts. Costs include conversion of rooms/buildings, decor, small and large kitchen and display equipment, fitments, table and furnishings, office equipment, till(s).

If catering off-site, essential to have special mobile refrigeration and ovens to meet the Food Hygiene Regulations.

Building costs can range from £25,000 upwards, fittings and decor allow minimum £10,000. Mobile refrigeration and oven costs vary considerably. Minimum one year guarantee should be obtained for second-hand equipment.

Wastage must be tightly controlled. Fluctuations in demand can be considerable and seasonal.

Average tea room spend seldom exceeds £3.00/head. Restaurant margin over food costs can be 65%. Off-site margins after direct costs can be approximately 1/3 of sales before general overhead and financial charges.

Average cost of an evening meal in farms providing Diner, B&B in 2001 ~£12.

Planning permission for enterprise - Town and Country Planning Act 1990. Premises must be registered with the Local Authority and Environmental Health Department.

All operators, supervisors and managers should be food hygiene trained to the appropriate level. Legislation covers - Sales of Goods Act, Trade Description Acts, Prices Acts, Weights and Measures Acts, Food Hygiene Acts and Codes of Practice, Food and Environment Protection Act, Employment Law, Occupiers Liability Act, Taxation, National Insurance, VAT, Tenancy Law, etc.

Scottish Tourism Industry Training Training to Train Giving staff the skills to provide training effectively. Excellence through People Encouraging best employment practices in hospitality. Welcome Host Improving the quality and delivery of the tourism product.

Scotland's Best A quality service programme aimed at staff, supervisors and management. The Natural Cooking of Scotland Promoting the use of Scottish produce in Hotels, Tea Rooms, B&Bs and restaurants.

Through the Scottish Rural Development Programme (SRDP) 2007-2013 funding is now available for rural businesses throughout Scotland for diversification and renewable energy projects. Specifically, support is delivered through Rural Development Contracts – Rural Priorities which was launched in April 2008. For further information about what support is available see the Section on Rural Development Contracts – Rural Priorities.