The future of the small farm is under threat. Those who want to run a small farm face increasing challenges linked to their network, trade reach and the threat of competing with larger farms. We explore the challenges currently faced and factors influencing their success. We also offer solutions for small farms to be successful.
The definition of a small farm is flexible. Factors like livestock, output, employees and land mass all play a role.
To simplify the issue, the EU regulations on farming tend to focus on land mass as the key characteristic when defining a small farm – often because it is the easiest information to gather. Therefore, farms that occupy 5 hectares of land or less are typically considered a small farm.
The vast majority of the EUs farms are small farms, but most of the EUs agricultural funding still goes towards bigger ones. However, the largest volume of food still comes from large farms and in recent decades, small ones have experienced the strongest decline in the EU.
We do not restrict the definition of small farm as narrowly as the EU commission does. Simply, because understand that there are a huge number of factors that can define a small farm that go beyond just land mass.
The issue with the EU commission approach is that many small farms will fail to get funding, support and ultimately the help they need to survive because they don’t fall into the right category set by governing bodies.
According to the EU commission, one of the biggest factors in their success is their involvement in local food systems. As per a recent report “when they are well connected in the supply chain, their businesses are more viable”.
Small farms often face an uphill battle, since the current market structure pays preference to intensive production and large-scale farming. On top of this, larger farms work with bigger networks that allow them to diversify their business and distribute excess stock when necessary.
They help to keep remote rural areas alive by keeping up services and social infrastructure. They also help to preserve the identity of regional products that may be overlooked by larger farms. This is often aided by a farm shop. In addition, they offer employment in regions with fewer job opportunities.
UK land and farms have seen increased popularity in farm shops during recent years. As of March 2022, UK farm shops were found to generate £1.4 billion in sales and employee over 25000 people. These places are important not only for selling local produce but also as a cornerstone of the argi-retail economy.
However, there is a trend of larger farms buying smaller farms. As the number of large farms increases, it becomes harder for people who run a small farm to survive in the market.
Larger farms can undercut smaller ones in prices, since they can sell their stock in greater volumes, afford more efficient and expensive equipment and tend to be more resilient to market fluctuations.
Therefore, an active and diverse network for the small farmer is essential to bolster their market position against larger competition. However, smaller farmers tend to have a more limited and less diverse network. FruPro helps by connecting small farmers directly with buyers.
Small farms face a number of challenges and threats, some of which include:
Competition from large-scale agriculture: Small farms often struggle to compete with large-scale agriculture in terms of price and efficiency, making it difficult for them to survive in the marketplace.
Lack of access to resources and markets: Small farms often have limited access to resources such as land, financing, and market opportunities, making it difficult for them to expand and thrive.
Climate change and weather variability: Small farms are vulnerable to the impacts of climate change and weather variability, which can reduce crop yields and harm livestock.
Pest and disease outbreaks: Small farms can be particularly susceptible to pest and disease outbreaks, which can cause significant crop and livestock losses.
Lack of succession planning: Many small farms lack a clear succession plan, making it difficult for the next generation of farmers to take over and keep the farm in operation.
Limited government support: Small farms often receive limited government support compared to large-scale agriculture, making it difficult for them to access resources and services that can help them to be successful.
Small farms can benefit from an online B2B marketplace in several ways:
Increased market reach: An online B2B marketplace can give small farms access to a larger customer base, allowing them to sell their products beyond their local area.
Improved efficiency: By using an online marketplace, small farmers can streamline their sales and distribution processes, reducing the time and effort required to find and sell to buyers.
Cost savings: Online B2B marketplaces can reduce the cost of marketing and distribution for small farmers by providing a platform to reach a wider audience at a lower cost.
Increased visibility: Online B2B marketplaces can help small farmers to increase their visibility and build their brand, making it easier for them to attract new customers and build their business.
Access to new customers: Online B2B marketplaces can connect small farmers with new customers who are looking for high-quality, locally-sourced food and products.
Increased revenue: By using an online B2B marketplace, small farmers can increase their revenue by reaching a wider customer base and improving the efficiency of their sales and distribution processes.
An increasing number of farms are connecting directly with end retailers to shorten the supply chain and reap steeper profits by connecting directly with retailers. Equally, there remains the option of connecting with wholesalers and importers if you need the value added services of middle sellers.
Connecting with end retailers only works with access to an active and responsive network. FruPro helps streamline the supply chain for growers so that they can connect with retailers directly.
There is good reason for small farms to continue, but a lack of support for them to do so currently. The market prefers larger producers, cheaper prices and quick turnarounds, which leaves small farms in a tricky position. If small farms want to champion their market, FruPro helps them to trade and stay connected.
If you are ready to talk, fill out the form below and let us help your business.
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