What is a diverse farm?

Diversified farms have expanded their day-to-day operations to include non-agricultural activities that use farm resources. For example, running a café or shop or generating renewable energy.

What are the benefits of diversification?

One of the biggest benefits is having an extra income stream, which can increase earnings and help improve financial resilience if core farming activities take a downturn. Choosing environmental-based opportunities, such as renewable energy generation or woodland development, also supports environmental sustainability. You can also forge closer community links through activities geared towards families, schools, and other educational facilities.

How many UK farms have diversified?

Latest government figures for 2024-2025 show that 72% of farms in England have diversified. This is an increase of two percentage points from 2023-2024.

Top farm diversification ideas | Alan Boswell Group

Top farm diversification ideas

Latest government figures reveal that 72% of farms in England carry out some form of diversified activity, generating an average income of £31,000. These figures are an increase from the previous year, highlighting the growing importance of diversified activities on agricultural land and property. With that in mind, we explore some of the most popular farm business diversification ideas to help you top up your income.

Updated: 04.08.26

By Sam Brown

What is farm diversification?

Farm diversification is when farms expand into other activities alongside their main agricultural operations. For example, using unfarmed land as a campsite or letting out unused buildings.

Why do farmers need to diversify?

Farmers often choose to diversify to spread risk, particularly as the agricultural industry grapples with unpredictable weather and fluctuating materials costs, such as fertiliser. Creating alternative income streams helps provide some stability and enables farmers to make the most of the assets they may already have – such as outbuildings and unfarmed land.

Changing subsidies also means many farmers are looking at different ways to raise money, including creating and developing woodland and investing in renewable energy.

For some farmers, the diversified activities they pursue aim to support and bring local communities together.

Top farm diversification ideas

The right diversification activity for your farm will inevitably depend on local demand, the set-up costs, and existing resources you have, for example, available land, buildings, and expertise.

Whatever idea you choose, remember to consider all the legalities, including appropriate insurance and licences if needed – here’s what to consider:

Letting out buildings

Letting out buildings is the most popular diversified activity and (according to government figures) brings in the most income. However, it’s not one-size-fits-all and what you can offer will depend on the buildings you have, their condition, and how much you want to spend.

You’ll also need to consider what outcome you want; for example, diversifying into holiday lets will generate more gross income than renting out an old grain barn as storage, but holiday homes typically require considerable upfront investment, will require ongoing resources, and you’ll have ongoing expenses such as holiday home insurance.

Host weddings and conferences

Barns can make fantastic venues for wedding parties, but the market is competitive. Despite tighter budgets, couples are increasingly looking for convenience and quality. For example, insight from property experts, Savills, found that exclusive use of a venue and on-site accommodation are two of the most popular searches. So, if you also offer holiday lets, this could be a diversification to consider.

Similarly, offering conference facilities or space for corporate events can help provide an extra income stream outside of the wedding season. That said, if you intend to offer this, you’ll need to ensure WiFi speeds and connectivity are adequate for business needs, and you’ll also need to consider accessibility, transport, and facilities.

Offer camping or glamping

If you have space, providing land for campers is a straightforward and fuss-free way to diversify. For added value, think about providing basic facilities such as shower blocks, electricity, and drinking water.

If your objective is for long-term viability, glamping offers the opportunity to charge significantly more. Nevertheless, it would require upscaling the facilities you provide, which would increase expenditure.

You’ll also need to stay on the right side of your local authority, so make sure you check planning permission and whether you need a licence to run your campsite.

Petting zoo

A petting zoo on a farm can help diversify farmers’ revenue sources, providing income during traditionally quieter seasons. It can also offer educational opportunities to children and adults and strengthen community engagement by serving as a learning space for schools and local communities.

Attracting families also gives you the opportunity to market farm produce and earn extra income by selling food and drinks. If you want to expand activities, you could set up additional children’s activities, such as soft play or playground areas, to encourage visitors to stay longer and (hopefully) increase their spend.

Establishing a petting zoo comes with challenges, such as ensuring animal welfare, complying with regulations, and providing a safe visitor experience. With the increased footfall from members of the public, this diversification requires careful consideration to ensure the risks are correctly insured. Depending on how extensive the operation is, you may need several separate insurance policies in addition to your main farm policy.

Experience days

Offering experience days can be lucrative and enjoyable if you have a particular passion or skill. You could also add value by tying it to camping or glamping packages, allowing people to stay overnight or for a weekend. Experience day ideas include foraging, wood, metal, or leather working, or rural crafts such as basket making or spinning yarn.

Another increasingly popular activity is wellness experiences, including therapies and treatments. This works particularly well if you can utilise an area with fantastic views. For inspiration, take a look at Suffolk’s Be Well Barn, which added an 8,000 square foot wellness centre to a family farm.

Sell farm produce

This is often a natural extension of your day-to-day activities, or you could dedicate land to specific activities such as ‘pick your own’.

If you’re aiming to set up a farm shop or café, think about your location and the type of consumer you want to attract. Tips from those who have already diversified into this include making sure you’re within a reasonable distance of a large town, as this helps ensure you have a sufficient local market.

It’s also worth thinking about how shopping has changed, particularly since the pandemic. Offering extra services like delivery or click-and-collect can increase appeal. If there are other farm shops and cafés in the area, don’t forget to research the competition and think about what you can do to stand out.

Speciality livestock and animal services

If you’re passionate about rare breeds, you could turn that into an activity that can bring in extra income. Whether that’s rearing them for show, for meat, or wool, specialising can open up new doors and raise your farm’s overall profile.

You could also branch out into providing animal services, such as a kennels or cattery. Other services you can add on include dog grooming, dog training, and agility; if you have stables, livery is another option. These do, of course, take up time. So, unless you’re skilled in these areas or are willing to learn and nurture these offshoots, you’ll need to consider suitable staff and how this will impact profits.

Seasonal or annual events

Classic events include Halloween trails, pumpkin carving, or maize mazes for children. Plus, Christmas barns that sell decorations could be a precursor to ‘meet Santa’ events if you’re looking for something that could be developed in the future. While these are strictly time-limited and seasonal, they could be particularly lucrative within a short space of time. You could also complement these events by hiring out barns for art exhibitions and craft markets.

Renewable energy

According to government research, the average income from generating renewables is £19,800, making it a lucrative option.

Whether you utilise roof space on barns to harness solar energy, lease a field for wind turbines, or install biomass burners and anaerobic digesters to generate gas and electricity to power your farm.

If renewables are something you’re keen to invest in, our renewable energy insurance can help you cover the risks from start to finish.

Invest in woodland

If you have land to support trees, grants are available to help you create new woodland. Funding is also available to help you protect tree health (covering some felling and infrastructure costs).

Although grants do change, so be sure to check what’s available and the terms before committing. For more information and links to available funding, visit: GOV.UK, funding for farmers, growers and land managers.

What are the disadvantages of farm diversification?

Farm diversification isn’t going to be right for every farm business, and one of the disadvantages is that your sideline takes you away from your main farming activities.

Upfront funding

Funding is one of the biggest barriers to diversifying, especially if the activities you want to pursue have significant up-front expenses. Before you dismiss any ideas, it’s worth checking to see what grants or funding might be available. It’s also a good idea to set out a business plan for more accurate costings and projected income.

Market and demand uncertainty

It’s difficult to predict how the overall market will pan out, and often, even if you start out as the only farm in your area offering a particular service, within a few years you could be one of many. Needless to say, a surge in competition can make business a lot tougher and demand more of your time and resources.

You can counteract this by continually reviewing the services you offer compared to local competitors, as well as seeing what other farms are doing across the country. Investing in your offering is also crucial, especially if you’ve chosen to go down the wedding services or glamping route, where your customers will expect a certain level of quality.

Not having the right skills

Good ideas are one thing, but you’ll also need to execute them, and if you don’t have the right skills (either to market your new activities or provide them in the first place), then it’s unlikely your new enterprise will thrive.

You can avoid this by hiring people with the right skills or by training yourself; both will require investing more money, but they could be worthwhile if they generate reliable income.

How complicated is agricultural diversification?

Farm diversification doesn’t necessarily mean branching out altogether. In some instances, diversifying your activities is simply the logical next step, for example, making cheese or selling fleeces. It’s also vital not to underestimate the importance of research. Not just in terms of permission, but also consider local competition and long-term feasibility.

A comprehensive business plan can ensure you stay focused on your original objectives. If you really don’t know where to start or are toying between ideas, the Farm Business Innovation show is the largest exhibition of its kind in Europe. The event is a chance for farmers and landowners to explore opportunities and seek expert advice.

FAQs

Supporting farms across the country

Agriculture has long been one of our areas of expertise, and we understand just how important agricultural diversification is for many farms. Our dedicated insurance experts are on hand to support you and tailor farm insurance to suit how you’ve chosen to diversify.

For more information about how we can support your farming operations, take a look at our agriculture insurance page or speak to a member of the team on 01603 218000.

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Top farm diversification ideas

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What is farm diversification?

Why do farmers need to diversify?