Despite their recent elevation in status, community food businesses haven’t always been seen as a key part of our society. For many, trying to find the funding to upscale or buy essential pieces of equipment has been impossible without collateral to secure a bank loan. The only other option has been grants, which can take significant time and effort to win and have a high chance of failure.
Into this void came LEAP – the Loans for Enlightened Agriculture Programme, which was started by the Real Farming Trust in early 2019. Programme Director, Robert Fraser, explains that they wanted to offer people the option of ‘blended finance’ – a mix of an unsecured loan and a grant together – to help them grow their businesses in a sustainable and financially resilient way.
With funding from the Esmee Fairbairn Foundation, CIVA, the A Team Foundation, the Halleria Trust and Power to Change, LEAP offers loans of between £20k – £100k with a top-up grant to help people take the next step, whatever that maybe. Crucially, they also offer mentoring and financial advice, which supports businesses with little time on their hands to strengthen their governance or draw up business plans and financial forecasts.
One of LEAPs grantees is the The Apricot Centre, near Totnes in Devon, which sells a range of biodynamic and organic produce and runs therapeutic support sessions for families and children. Director, Marina O’Connell, explains, “The loan from LEAP helped us finish off all the bits and pieces that would never have got done otherwise. We were able to put in a propagation house so we could have a lot more control over what we are growing and build some huge polytunnels for peaches, passionfruit and kiwis – not fruits you usually get in Devon! We were also able to put PV panels on the barn, which will reduce our electricity bills significantly.”
For Reuben Chesters, managing director of the highly successful Glasgow-based business, Locavore, the LEAP loans were the only way he was able to grow the box scheme, refit their first shop and develop a second shop in the West End of Glasgow. “We knew the market was there, but we couldn’t go for a bank loan because we didn’t have any assets to borrow against. The LEAP loans are unsecured, although there’s a process you go through which helps to ensure your plans have the best chance of being profitable, which was really useful”.
LEAP has now opened a second emergency small loans programme, particularly aimed at helping community food businesses that have had to change their operations as a result of COVID-19.
One of the successful applications to this new programme was Hempen, the pioneers of certified organic hemp and CBD products. Hempen relied on markets and trade shows to sell their products, but the lockdown knocked out an estimated £48,000 worth of sales for them. The LEAP loan is financing an expanded digital marketing strategy to grow Hempen’s online sales, enabling more customers to benefit from their products. This investment – along with fantastically timed article on the health benefits of CBD oil in combating coronavirus – has seen an increase in sales of over 100%. For Anaelle Bouabdelli, Finance Director at Hempen, the simple application process and quick decision was essential during this challenging time. “We received invaluable support from the Real Farming Trust as a start-up a few years ago, so we were so glad to find out about the LEAP emergency loan programme and found the application process to be very supportive – LEAP understand our values-driven workers’ co-operative in a way that commercial banks often don’t.”
These loans for between £5,000 – £20,000 are available until September, and LEAP are looking for further enquiries from anyone who would like to know more. “We’re really hoping to support community food businesses meet the growth in demand and supply chain challenges that the current crisis has put on them,” says Robert Fraser. “We welcome all expressions of interest and even if we can’t help them, I hope we’d able to direct them towards other sources that will.”
For more information, please visit http://www.feanetwork.org.