Game, Set and Match for British Strawberries
The headlines we’ve seen recently warning that the death knell may have sounded for strawberry farming have, you won’t be surprised to hear, caused a great deal of consternation in the UK farming industry.
The future of British strawberries – inextricably linked into our culture through Wimbledon, which traditionally kicks off the strawberry season – may be in jeopardy due to rising costs.
The imposition of a national living wage is a move widely welcomed by workers – but it’s not such good news for British farmers, operating on tight margins, who may see their costs rise to unsustainable levels as a consequence.
Cue warnings in the media that increasing costs could have a devastating impact on British strawberry farming[i].
The National Farmers’ Union has warned that increasing costs driven by the rise in the minimum wage could cost growers 58 per cent of their profits immediately[ii]. According to the union, this figure could rise to 158 per cent[iii].
While the NFU has urged the Government to move to subsidise the effect of the new living wage on the farming industry, there is no indication so far that policy is set to shift in that direction.
So with the national living wage set to stay, and increase in line with inflation over time, UK farmers now find themselves in a position where efficiencies need to be found if the British-farmed strawberry has a future.
And it’s not just the British strawberry in the firing line. Fresh produce farmers supplying everything from lettuces to tomatoes and peppers are likely to be impacted by these rising costs.
For British farmers this leaves two options: abandon their commitment to farming fresh produce in the face of unsustainable cost increases as retailers opt for cheaper imports or move to find efficiencies elsewhere.
For those minded to find efficiencies, and implement sustainable business models for the long term, capable of absorbing future cost increases, enterprise resource planning software could hold the key.
How can enterprise resource planning reduce costs?
Demand forecasting, a key feature of ERP software, is an essential tool for farmers concerned about costs. Sustainable farmers need to know how much of their produce will be demanded – this informs their decisions on things like how many fruit pickers are needed – which has an inevitable impact on costs.
Those unable to forecast demand may employ more pickers than necessary. The effect of this is twofold; increased cost of staff and potentially decreased prices in the supermarkets if this leads to an oversupply of produce.
Neither of these outcomes is conducive to the efficient business model farmers need to ensure sustainability.
For inventory management too, another key area for preventing excess supply, managing short shelf life and preventing wastage from spoilage. ERP could have a crucial role to play – ensuring accurate detail is available on inventory stock.
Mobile applications too can play a key role in accurately recording data electronically, thus eliminating the need to maintain paper records which in turn incur unnecessary administrative costs for data input. In-field applications for labour or resources management, collecting crop or harvest data, and traceability could prove invaluable.
As external costs increase, and limited political support for Government aid, farmers find themselves in a position where costs may need to be reduced internally. To effectively highlight where inefficiencies lie, farmers need full visibility of their business processes.
With this in mind it’s no surprise that we’ve seen increasing numbers of farmers investing in ERP software to help streamline their businesses and reduce costs.
And in light of newly-increased costs for the industry, it’s set to be a compelling consideration for more fresh produce farmers than ever before.