Selling assets

Selling assets can be quite an emotional process, especially if they have been in the family for some time. However, it could provide your business with much-needed cash or help you clear some debts.

When considering selling land, think about efficiencies. What is your least productive land? Do you have parcels of land further away from the rest, so cost more in time and fuel to farm? Are there fields that may be attractive in the longer term for a developer that may command a premium price, resulting in fewer acres being sold? Are there neighbouring residents that may be interested in expanding their gardens or purchasing pony paddocks, as such land will command a significant premium? Is it the correct long-term decision to only sell some of the land, or is it more appropriate to sell the entire farm and relocate?

Sell some livestock or change breeds

Although disposing of livestock to raise cash may appear attractive, selling breeding livestock can affect future outputs and therefore requires careful planning. If converting the land to arable production is a viable option, then reducing livestock numbers will normally release cash. In hill and upland situations, alternative choices will be limited. Changing breeds can lead to an improvement in output, but this course of action takes time to implement if crossing existing animals, or alternatively may increase the immediate capital required if buying new animals.

Sell some machinery

Most farmers keep some older machinery just in case they may need it in future years even though it continues to deteriorate and rust. Machinery not currently in use should be sold even if it only has a ‘scrap’ value. Others keep additional tractors or vehicles because of the convenience factor, but maintaining these can be an unnecessary expense. Bear in mind that each worker can only drive one tractor at a time. When new machinery investment is required, consider whether contracting or machinery sharing is a cheaper.