Bayleys news & articles

Rural Insight: Bed and Breakfast offers farm income option

Tags: Rural Rural Insight

The view many farmers take for granted on their farm may also be a money earner that makes life on the farm a little easier.

As tourism booms to eclipse the earnings of even the dairy sector, rural families have the opportunity to leverage off the success of a sector whose growth is showing little sign of slowing.

With almost $6 billion of the total annual tourist spend going on accommodation, opportunities exist for rural families struggling with the volatility of commodity returns and wanting to earn more within the farm gate.

Bayleys New Zealand country manager Simon Anderson says the ability for farmers to tap into tourism’s accommodation sector through offering bed and breakfast (B&B) accommodation could provide a valuable alternative income source to help stabilise farm incomes.

Latest Statistics NZ data shows the tourism boom has been stronger than expected with international visitors spending $15 billion here to the end of March, up 21% on the year before.

Meantime locals have not been staying at home either. Kiwis are more than matching them dollar for dollar, spending $20 billion over the same period. As a whole the tourism sector now contributes $13 billion or 5% to GDP.

 “For many farmers their business’s location, scenery and local activities are things they may have taken for granted, when in fact they are hugely attractive to visitors from heavily urbanised, crowded countries,” says Simon Anderson.

“B&B operations offer a means to appeal to such a tourist market, without necessarily having to completely shift your focus off the farm, or face significant capital outlay.”

But considering a B&B operation is not simply a case of swapping the overalls for a collared shirt, throwing a duvet on the bed in the spare room and putting a “welcome” sign on the front gate.

Kathryn Officer, president of the Bed & Breakfast Association advises that a rural property running a bed and breakfast would probably not be relying upon it for their sole income.

“Although we have members operating in rural areas, particularly in Canterbury, most of those member properties would be operating it as supplementary to the main income,” she says.

The early days when New Zealand’s first B&Bs had a simple “zip-zap” credit card machine and a sign on the gate are a model that simply does not work anymore in a connected digital world.

“Most B&Bs would now have websites, booking engines and use channel management systems to connect with online travel agents. Some will even pay huge commissions to inbound tour operators to encourage bookings from overseas agents.”

She says the overseas popularity of B&B accommodation is starting to kick in here, with overseas visitors keen on the “experiential” element of travel, wanting to get a feel for what it is like to be in a New Zealander’s home.

Bruce and Karen Forrester of Karetu Downs in the Waipara Gorge North Canterbury have integrated a B&B business with their 1800ha property, giving guests a taste of real life in a hill country station.

For Karen the business provided a better option than travelling an hour to Christchurch to work every day, and fits well with the couple’s social nature.

“We both enjoy learning about the lives of the people who visit. The tourism market is also evolving quickly at present, and visitors want a real hands on experience when they come here, which is what they get – we encourage it.”

Her advice is for intending rural B&B operators to take it slowly, growing organically and accept it is not a huge earner, but a useful and interesting side-line to the farm business.

Kathryn Officer said while technically anyone can open a B&B, owners do have legal responsibilities to comply with, and belonging to an association like hers can help ease the pathway to successful accommodation provision.

For anyone considering a rural B&B she also cautions about understanding the market they are trying to appeal to.

 “You need to know what your point of difference is. Where are your guests coming from, as not everyone will want to be in a remote area. Aspects like proximity to town will determine if you will need to supply dinner, for example.”

Download PDF

Related articles