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Top tips for diversifying into food and retail

As part of a series of NFU Mutual podcasts called ‘Ahead of the Field’, we heard how the Rhug Estate in Wales has diversified to thrive.

In just 20 years Lord Newborough has transformed the Rhug Estate in North Wales from a 2,000 acre sheep and cattle farm into a 12,500 acre business. It now employs over 130 people, with an international export business, renewable power generation, a bison herd, a farm shop and even a drive-through restaurant.

Here are some of the key things which have helped them to evolve and grow, which you might find useful if you’re thinking of diversifying too.

Surround yourself with the right people

To diversify into something completely new, you’ll need help. Lord Newborough says he quickly realized he couldn’t expand into retail on his own. “It's not anything like farming so it's a steep learning curve if you don't know what you're doing.”

So, he recruited a strong team. “I am very lucky I have a brilliant team,” which includes passionate and experienced managers, he says.

It’s also essential to learn from others outside of the business, he adds: “Seek advice wherever you can. Go out and look what other people are doing and learn from other people's mistakes. I think if there's one good point you can take away from a visit somewhere else and adopt to your new business, do it.”

Play to your strengths

We have worked with Rhug both before and during its two decades of expansion and diversification.

Merfyn Roberts, Rhug’s local NFU mutual agent, says the estate has thrived by making the most of what they’ve got

He says: “I think what they've done very successfully is played to their strengths. They've got a fantastic location here along the A5 road and they've built a team.”

This has made a big impact on the local area, Merfyn says: “It’s made a big difference to the local economy, and is bringing jobs into the area”.

Develop a strong brand

The team at Rhug Estate realised early on that they needed to develop a strong brand – backed by its own story – and to market it well. “One of the things that we learnt in the early stages, in developing the brand, is to have it highly visible wherever we could,"  says Lord Newborough. “You have to have a story. You have to have a brand and a belief, and some sort of vision as to where you're going,” he adds.

He gives an example: “You'll notice here that meat is shrink wrapped in a bag with the brand on it, so whoever opens that box is confronted by the brand. That's what they remember, they remember Rhug, they remember the crest.”

Don’t be afraid to do something totally new

High street coffee chains might seem an unlikely source of inspiration for a farm seeking to diversify, but that’s exactly what happened for Rhug, and the result was a drive-through restaurant, which they believe is the UK’s first on a farm. It complements the existing bistro, takeaway and farm shop.

Lord Newborough explains: “I saw Starbucks and Costa opening some drive-throughs and I thought we're in such a good location here with the busy main road, that it was an obvious extension to what we were already doing.”

Be savvy to broader consumer trends and tastes

Rhug’s diversification has been driven by consumer demand for quality, organic food. The business has continued to adapt to changing demand, as well as anticipating future consumer tastes, Lord Newborough says.

The estate’s retail manager, Graham Webster, adds: “I think people are looking for a bit of extra quality now – not just what they can get in the supermarket. They want a point of difference, so they come to us because we've got some different things on offer that are a little bit more special and unique.”

Inject some passion into your business

Rhug’s diversification was born out of Lord Newborough’s belief and passion in sustainable farming. And it shows, says Merfyn: “What really underlines everything is Lord Newborough’s passion about the environment, organics, supporting local businesses and getting local staff into work.”

The passion for sustainability still informs all the business’s future plans, which includes the launch of a body care cosmetics range. Lord Newborough says: “It's applying the same principles that we're already applying to selling our meat. Basically, it's selling a product that you believe in, and it's selling a product with a story, that's produced perhaps using local ingredients and telling the customer about the environment the product is coming from.”

Don’t be afraid of change

To diversify, farms must take the difficult step of embracing major changes, which is exactly what Rhug has done.

Merfyn says: “A lot of farmers in this area, traditionally beef and sheep farmers, are quite reluctant to change. I think with possibly Brexit and all the other changes that we’re facing, farmers will have to look at diversification moving forward and there are huge opportunities out there.”

RhugEstate podcast transcript [PDF: 131KB]

Rhug Estate podcast transcrip Welsh [PDF: 233KB]