Finding a way into farming can be a daunting prospect if you don’t come from a farming family, or in many cases where the family business isn’t of sufficient scale to support a new entrant. This is where a joint venture arrangement can come in handy. Joint ventures range from contract farming, farm business tenancies, to share farming, and a combination of all of the above. It goes without saying that every joint venture set up is bespoke.
Just to clarify, a share farming arrangement is the coming together of two parties bringing their different expertise to the table with the inputs and outputs split on an agreed basis, and a contract farming agreement is a collaboration of one party providing the land and buildings and the other party providing the labour, stock and machinery. A farm business tenancy is the traditional joint venture method. Parties increasingly favour the flexibility that the share and contract farming arrangements offer.
Due to the bespoke nature of a joint venture its important to establish the aims and the objectives of the parties wishing to collaborate. We advise that a legal agreement between the parties should be documented to ensure that roles and responsibilities are clearly defined together with details of payment dates and how surplus profits are to be allocated. An agreed method for terminating, a break clause and the options to refer disagreements to a 3rd party should all be included. This is where professionals such as Baileys and Partners come in to play. We are experienced in advising on joint ventures from drafting heads of terms all the way through to attending quarterly farm partnership meetings. We work closely with our partners such as accountants and solicitors to provide you with a complete professional services package.
Online joint venture matchmaking services have opened up the market to joint venture opportunities, the key is finding the right partner for your business proposal. We have seen a change in the traditional farming set up and a positive shift in favour of joint venture agreements. Could your skills be matched locally to a landowner or could you see yourself working with others to maximise skill sets and the share of profits? We might be able to help find the perfect match for you!
Tudur Williams of Baileys and Partners will tell you that regular farm meetings are an essential part of every joint venture, and communication is key. According to Tudur it is imperative to have tea and biscuits at hand, these staples will help when agreeing actions, new opportunities, health and safety, cash flow and accounts, cropping and breeding plans and sales. An agenda should be sent, a chairperson should be appointed and the items discussed should be minuted.
Whatever your aim, please do not hesitate to contact us to see how we can help you achieve your goals and in case your wondering Tudurs favourite biscuit is a viennese whirl!