Diversification on a Shoestring

13 March 2025

As of 2022, 58% of Scottish farms have diversified beyond traditional agriculture. Notably, diversified farms earned an average of £24,200 more than their non-diversified counterparts.

Diversification not only boosts income but also enhances business resilience, fosters community engagement, and aligns with evolving agricultural policies. This article explores the key challenges and solutions to help you embark on your diversification journey.

Why Diversify Now?

Resilience: Changing policies and economic uncertainties make diversification a strategy for long-term stability.

Income: New revenue streams reduce reliance on traditional farming.

Community Engagement: Meeting local needs and attracting visitors strengthens rural economies.

Policy Alignment: Government support favours ventures contributing to rural heritage and tourism.
Succession Planning: Diversification future-proofs farms, making them more viable for the next generation.

Getting Started

Diversifying requires careful planning, but small steps can lead to big opportunities.

Identify Strengths & Assets: Consider unused land, buildings, or existing skills that could form the foundation of a new venture.

Research Demand: Look into tourism trends, market gaps, and local needs.

Start Small: Test your idea with a pop-up event or limited-time service.
Seek Support: Explore grants, partnerships, and networks to share costs and resources.

Community Collaboration

Collaboration can amplify the success of diversification efforts by pooling resources, sharing expertise, and creating innovative business models.

For example, Haar Sauna has partnered with Bigton Farm in the Shetland Islands to launch a mobile sauna on St. Ninian’s Beach, providing a unique wellness experience while highlighting the farm’s rural charm and natural beauty. Saunas are an innovative and increasingly popular wellness trends, as they require minimal space but offer high revenue potential, fit easily into a variety of settings, and are complementary to agri- and eco-tourism ventures.

Fitness Farmyard integrates social and economic benefits into its business. Founder Pete Eccles has created an on-farm fitness studio, offering locals a rustic alternative to city gyms. By adding a weekend coffee truck, he has transformed the space into a community hub where people can work out, socialise, and support local producers.

These examples highlight how land lease agreements, skill-sharing, and joint ventures can reduce financial barriers while enhancing rural economies.

Overcoming Challenges

Diversifying on a budget presents hurdles, but strategic planning and resourcefulness can help.

Limited Investment

Start small with low-cost ideas like farm-gate sales, pick-your-own produce, or small-scale agroforestry.

Seek funding through grants, crowdfunding, or local investment schemes.

Skills & Expertise Gaps

Take advantage of free training from FAS, SAC Consulting, and rural business networks.

Partner with local experts or friends who can help you out, like chefs for farm-to-table ventures, tourism professionals for agritourism, or a contractor for reparations and improvements.

Regulatory & Planning Barriers

Start with permitted development options that require minimal legal hurdles.

Seek advice from local authorities or business support organisations to navigate regulations efficiently.

Join farm co-operatives or industry groups for shared knowledge and lobbying power.

Market Uncertainty & Competition

Focus on niche markets like rare-breed livestock, eco-tourism, or wellness retreats.

Use social media and word-of-mouth marketing, which are cost-effective ways to build a customer base.

Time & Labor Constraints

Choose projects that complement existing farm activities.

Automate, streamline tasks, and maintain updated records using simple technology like a booking system.

Involve family members or local volunteers where possible.

Seasonal Income Gaps

Develop multiple income streams to spread risk (e.g., combining bed-and-breakfast stays with farm tours and a small shop).

Offer subscription models (e.g., vegetable box deliveries, community supported agriculture schemes) for steady cash flow.

Consider collaborative projects with other local farmers (e.g., shared farm shops, joint marketing).

Farm diversification doesn’t have to be expensive. By leveraging existing assets, starting small, collaborating with local businesses, and seeking support, you can create a sustainable, resilient, and profitable business.

Every diversification journey starts with a single step—what will yours be?

Related FAS Resources

Diversifying with Forestry Machinery: Farm Woodlands Information Note

Rural Roundup Bonus Content: Jock Gibson, Edinvale Farm (Diversification Story)

Adding Value | Helping farmers in Scotland | Farm Advisory Service

Related External Resources

Article: Diversification through a succession lens