Farm diversification project

The most effective investments in land based businesses usually form part of long-term plans, a fact that can give rise to a complex challenge: passing the business from one generation to the next. In Staffordshire, Roger Mercer and his three sons – Tom, Robert and Alec – have navigated an impressive growth and investment programme linked to succession planning, which has successfully brought in the talents, ideas and enthusiasm of the next generation, while continuing to make the most of Roger’s experience, skills and business nous. The business includes interests in farming, land management, commercial property, storage and renewable energy. As Roger explains: “Our core business is farming, but we are focused on making investments that protect and enhance the family capital.”

Mercer Farming farms 5,800 acres in Staffordshire and the Midlands, with the farm a mix of arable, pigs and chicken, as well as 6,000 acres of arable in New South Wales, Australia. Roger’s sons will be the fourth generation of Mercers to farm in Staffordshire, building on the legacy of their great grandfather who farmed Shorthorn cattle and pedigree Large White pigs on 200 acres. When Roger took over the farm from his father at just 26 years of age, he mixed the safer option (arable and dairy) with some risks (pigs and potatoes). “We have never been afraid to have a go, and this has been a key factor in the expansion of the business. But we’ve also not been afraid to pull out. We made investments in strawberries and butcher shops, but stopped both when they weren’t working.”

Adapting with the times has been essential. Roger explains: “We came out of cows in the 1990s and out of potatoes in 2005. These were cut-and-dry business decisions, but emotionally they were tough changes to make.” With his sons completing their education, Roger wanted them to have the same opportunity of making their own business decisions from an early stage. The time was right to set out new plans for the business to grow securely, creating a business model that enabled and encouraged succession by the next generation, all the while putting to the fore the family’s commitment to the environment and to the local community. Roger sums up his attitude towards the relationship between their long-term investment plans and the succession of the business: “It’s a fairly common perception that succession is all about giving assets to the next generation. Really, it’s about giving control.” The family followed an investment strategy based on spreading assets, ensuring a distinction between land/property and farming, and maintaining a focus on return on capital in each enterprise. The result has been the development of several new business strands that sit alongside the existing farming and property operations: most notably Packington Pork, Packington Poultry and Packington Free Range. The success of the Mercer family’s investment approach is self-evident. The family business now employs 105 people. Packington Pork, with Robert as managing director, was launched in 2004 and now has 10,000 outdoor breeding sows, and 4,500 pigs are sold to M&S weekly via Cranswick, with another 650 a week sold directly to butchers and farm shops. Alec is managing director of Packington Poultry, which was launched in 2007. The business sells free-range chickens and cockerels through independent butchers. Packington Free Range was formed in 2006 and supplies 160 butcher shops.

As well as being a director of Mercer Farming, Tom has his own business, MOMA Foods. This healthy breakfast business launched in London in 2006, and is now sold in supermarkets across the country, as well as airlines, offices and high-street shops. However, the investment programme has not focused solely on growing the bottom line. The Mercer family is committed to investing time, money and passion into projects that benefit their local community. The education centre, where the children learn more about farming, farm animals and the environment on their land, receives visits from schools every day of the summer term. Last year, the business reached more than 4,800 schoolchildren. Through the impressive FarmFresh Revolution programme, the business delivers fresh meat, vegetables, and fruit to low-income families via local schools every week. The aim of this programme is to help educate and inspire families about healthy eating, nutrition, and diet, and FarmFresh deliveries amount to 9,000 bags of fresh produce each year. Similarly, Mercer Farming’s investment in nature and the environment is plain to see. Part of the National Forest, the business has planted more than 80,000 trees in the last 20 years, and it was the first LEAF Marque assured pig and poultry business in UK. Roger is rightly proud of all that Mercer Farming is achieving, but he makes a crucial point: “We can only support nature and the community, investing our time, effort and finances, if we are profitable as a business.” He adds: “One of the benefits of encouraging my sons to take a leading role in the business is that it allows me to be more involved in work to support the farming industry more widely.” Roger spent four years as chairman of governors at Harper Adams and has been chairman of Nuffield International. By creating an investment plan linked to a business model designed to work now and long into the future, individuals within the Mercer family have been allowed to develop their potential. With oversight through a family board structure, proposed projects are put to the board and the business case discussed before the board makes a decision. While some of the growth of the business has come about as a result of early planning, other areas of growth have happened as opportunities have arisen. Roger explains that a question he asks himself all the time is: “Am I proud of what we are doing?” The answer is a simple one: “I’m very proud of the growth of the business and our community projects, and particularly that over the past 10 years the efforts of the next generation have been central to that growth.”