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‘Think of the benefits of collectives’
4:11pm Friday 30th September 2011 in Farming
Arable farmers have been advised to consider the benefits of collective buying power to maximise their profits.
Simon Graves, a farming consultant in Strutt & Parker’s Northallerton office, said with the sowing of autumn crops now in full swing farmers would be working out how best to maximise their profits.
Although world grain prices are at historically-high levels, he said the continuing volatile nature of the market represents a constant challenge for farmers in maximising their revenue.
“Additionally, input prices are rising dramatically with annual increases of at least 40 per cent for seed, 50 per cent for nitrogen fertilisers, 30 per cent for phosphate and potash and 15 per cent for pesticides.
“Clearly it is vital that farmers make savings where they can. One way to do this is purchase those inputs through a buying group as the benefits of collective buying power can be huge.”
Mr Graves said the Strutt & Parker Buying Group sources materials such as seeds, fertilisers and pesticides for clients at the lowest possible price often with preferential payment terms.
“It enables farmers to benefit from economies of scale and the close relationships with suppliers that we as a firm have built up over many years,” he said. “We currently provide a wide range of products for more than 150,000 acres of land in the UK.”
One client, who farms 800 acres in the Vale of York, saved 57 per cent on the price of pesticides by purchasing through the group rather than ordering direct.