Starting a Farmers’ Market
Janet Hurst is a farmer who teaches other farmers how to market their products, and The Farm to Market Handbook (Voyageur Press, 2014) is a guide to creating a successful and sustainable business out of your small farm. From farmers’ markets and CSA programs to selling to schools and restaurants, you can find venues for your products with a little foresight. The following excerpt is from chapter 5, “Starting a Farmers’ Market.”
You can purchase this book from the Capper’s Farmer store: The Farm to Market Handbook.
If there is not a viable market in your area, consider starting one. The best way to begin is to contact friends and neighbors who grow, bake, or make quality handmade items. Plan a meeting and see what kind of community interest there is. If there are enough (four to eight people can start a market), then you can move forward.
There will have to be some kind of governing body—either a board or one person as the market master—to give structure, answer questions, talk to the press: in other words, present a united front. It is also advisable to have the vendors sign an agreement stating what can and cannot be sold, hours of participation, cost of and payment for the booth fee, etc. Will you require product liability insurance? Depending upon your location, the landowner may require liability insurance. It is definitely advisable to have liability insurance on the site.
Start your planning sessions in the fall before your spring opening. It takes a surprising amount of time and preparation to get started. Established and successful markets prove that this forecasting is time well spent. You do not want to start the first day without a pretty good idea of how things are going to run. First impressions are lasting to your customers. After a few weeks, it will become natural, although there are always unanticipated events when you are dealing with the public.
Competition for farmers can be a factor. In almost every market, there is a reported shortage of producers. What can you offer a farmer to set up a booth at your market? Good location, advertising, perhaps assistance in setting up or taking down displays? Of course, no one can guarantee sales and part of that rests with the producer. Simply work to provide a hospitable environment, a friendly well-run market, and overall support.
Rural and city markets differ namely in the pricing structure of goods sold. It seems the farther away customers live from a farm, the more they are willing to pay for the products. Perhaps this is only fair when considering travel time, mileage, gas, etc. There is a price to pay for participating in high-end markets, both in expenses and fees. Make sure to consider all costs before traveling too far away from home. For some, a trip to the city is well worth the effort.
Decide upon the days and hours of operations, and such concerns as weather policies. What type of displays will be expected? Will vendors provide their own amenities, such as tables and canopies? Will a specific type of canopy be required or can vendors use what they have (are you going for a uniform appearance)? Will this be a producer-only market or can vendors bring in produce bought from other sources such as brokers? What do you consider local—20 miles, 50 miles? All of these questions should be considered at your first meeting. Appoint a secretary to take notes, then distribute those notes so everyone is on the same page. What percentage of booths will be designated for crafts? Will you supply electricity? Decide upon a list of rules.
Alert the local health inspector of a coming market. Work with the inspector from the beginning to foster a good relationship. This is key to getting along with the powers that be from day one. Have the health inspector join the potential market vendors at the second meeting and discuss rules and regulations so everyone is on the same page. Talk about restrooms, handwashing stations, and the requirements for meeting the city, county, state, and any other pertinent codes.
If your city gets on board, so much the better. Often the area chamber of commerce or other city government entity is glad to assist with some resources and expertise. Ask for help with such start-up needs as procurement of liability insurance and a banner to announce the market. Markets are beneficial to the community, and the more buy-in you have, the better. Civic groups often volunteer to lend support.
Raising Money and Advertising
Every organization needs money: incidentals and rental fees for facilities and equipment, to name just a few expenses. Farmers’ markets operate by collecting fees from vendors, but this is often at a shortfall of actual operating expenses. Consider fundraisers. Sell T-shirts, shopping bags, raffles for market baskets, and other inventive ideas to raise funds. Ask vendors to participate by offering a special farm visit for raffle, perhaps a farm-to-table dinner or another event. Ask other organizations to assist with fundraisers, too. After all, the farmers’ market is a benefit to all.
Contact the local newspaper and radio stations to let them know about the new market. Engage in shameless market promotion! Start a Facebook page for the market. Do what you can to promote your market, even if it is on a shoestring budget at first. Designate a portion of the vendor fees for advertising. Buy a banner and signs as soon as possible. Consider a publicity committee and find someone with some talent for writing. Create a market newsletter to keep in touch with vendors and customers.
If you have an advertising budget, use it to post small ads in the local newspapers to inform potential customers of your market. Utilize opportunities for free publicity. This can come about in a variety of ways. Host contests and ask the press to come to photograph the winners (best salsa, weirdest squash, biggest pumpkin). Invite local dignitaries for the opening of the market ribbon-cutting ceremony, and inform the press. Later, host a customer appreciation day and give awards to those who have supported the market throughout the season. Markets are newsworthy events so be sure to invite the press.
Often Boy Scouts, Girl Scouts, and 4-H clubs are looking for volunteer opportunities. Ask these groups to come in and help tear down after the market. They can also come in and do demonstrations of crafts, gardening, and other service projects. Try to include other organizations in the market to build strength, traffic, and community commitment. Assign jobs and delegate responsibilities.
The Market Master
Find the right person for the market master job, whether this is a paid or an unpaid position. A dynamic person—someone who is good with people and firm but fair—is the perfect market master.
The market master rules over all on market day. The reason the market master must have ultimate authority is because market day is not a day for debates. If there are issues, they should be addressed after the market, not during. Once again, on market day the market master rules: no ifs, ands, or buts. If the market master must be absent, then an assistant should take his or her place, and this assistant will have the same authority. Conflicts at the market are very bad for business. Hopefully the work done beforehand to organize the group and promote cohesion will keep the group working together in a successful, cooperative manner.
Keep Your Customers Happy
Make sure to adhere to rules. If the market is to open at 7:00 a.m., make sure it does. Vendors should not be allowed to sell before the market opens. This prevents customers from coming in early and buying up the “good stuff.” If the market is to remain open until 1:00 p.m., make sure it does. There is nothing more disappointing than making a last minute run, arriving at 12:50 only to find everything closed down. Some vendors say they do their best sales at the close of the market day.
Add a welcome/information booth to your market. Offer coffee and fresh pastries for sale (as a fundraiser) or invite a vendor to come in and sell these goodies. In hot weather, offer lemonade and iced tea. Vow to make the market the most welcoming, most friendly place there is. If there is a booth that needs a little zip, bring in an extra tablecloth and offer it to the vendor. Offer a fresh flower arrangement, and help that vendor have an attractive and successful market booth. Everyone will benefit from the extra touches. The goal is to optimize the customer and vendor experience, to enhance the overall spirit of the market, and to make yourself and everyone else look good. Raise the bar!
Markets, by nature, draw a crowd. They are generally happy places. Plan events that foster that feeling of light and airy, easy and breezy. Music definitely sets a tone for a positive atmosphere, so schedule local musicians to perform. Pay them, allow them to sell their CDs, or both. Nothing adds to a market like music. Bring in chefs and provide on-the-spot cooking demos. Plant seeds, hire face painters, make a fun environment for kids so when their parents say they want to stop at the market, the kids will be eager to go along. Sell kid-friendly foods and projects. How about kid-sized soap or muffins? And, of course, don’t forget berries, cherry tomatoes, and all those other delicious, healthy treats.
Ideal Farmers’ Market Layout
As you lay out the market, think about traffic flow, where bottlenecks might occur, and how to maximize exposure for all vendors. Certain booths will always be a huge draw, whereas others will fade into the background without proper merchandising and extra effort to offer enhanced visibility. Plan a meeting and offer merchandising advice. Help your vendors be successful. If you plan to have music and activities, designate specific areas for those activities.
The welcome booth should always be front and center—a place for customers to go for directions and helpful suggestions. The person who works the welcome booth should be knowledgeable about the market and have a good handle on the layout and vendors. This is the place to sell those fundraiser items, recruit volunteers, and enhance the sense of community. This is also the place to have a first-aid kit and a lost and found.
If there are several vendors with the same product, space them apart from each other. Be careful that you don’t allow too many vendors who sell the same products into the market. Court farmers who have something unique. Mushroom growers, cheese makers, and other purveyors of specialty foods are often in short supply. If you can boast you have these vendors at your market, it will boost traffic and sales. Variety is key. At a recent famers’ market gathering, the remark was made that it should be a goal for a farmers’ market to satisfy 80% to 90% of customers’ overall grocery demands. With a well-stocked, well-rounded market, this goal is indeed attainable.
If your market is a bit lackluster, take a look at the displays. Are they inviting? Well stocked? Fresh and appealing? If not, the market master can make a few suggestions for improvements. These suggestions should be made in a neighborly and diplomatic way, of course. This is when it is good to have one designated person, the market master, to handle business.
Special events are a definite draw. People love competitions. This is a great way to focus on a particular vegetable. Why not a zucchini festival with a prize for the biggest zucchini, or a pesto, garlic, tomato, or pumpkin festival? Whatever the season, host a party at the market.
One popular event at an area market is the customer appreciation day. Last year on this special day, hot, sweet corn was served on a stick, dripping in butter. This treat was free to all attending the market that day. Now that’s appreciation! As cooler weather approaches, a chili cook-off is always a successful fundraiser. Bring in area teams to compete for the best chili and raise money for the market at the same time. Consider creating a committee within the market group specifically to work on special events and fund-raising. Cajole volunteers with big personalities to step up and lead the march.
Farmers’ Markets As a Not-for-Profit
Many markets form as a not-for-profit organization. Exactly what is a not-for-profit? According to USLegal.com (http://definitions.uslegal.com/n/non-profit-corporation/), “A nonprofit corporation is a corporation formed to carry out a charitable, educational, religious, literary, or scientific purpose. A nonprofit can raise funds by receiving public and private grant money and donations from individuals and companies. Certain federal, state, and local income, property and sales tax exemptions are available to nonprofit corporations. The federal and state governments do not generally tax nonprofit corporations on money they make that is related to their nonprofit purpose because of the benefits they contribute to society. The most common federal tax exemption for nonprofits comes from Section 501(c)(3) of the Internal Revenue Code, which is why nonprofits are sometimes called 501(c)(3) corporations. Tax-exempt nonprofit organizations offer donors an individual deduction for contributions. (Private donors can claim personal federal income tax deductions of up to 50% of their adjusted gross income for donations made to 501 (c)(3) organizations.)”
Under 501(c)(3), a market can accept donations and provide the contributor with a receipt for a tax deductible expense. Another advantage with this type of operating structure is the option to apply for grants. (Most granting agencies or foundations do not offer grants to individuals).
Each state has its own set of requirements for filing for this type of entity, but it is a fairly simple process. Inquire with your secretary of state’s office to find the specific requirements. Then request a corporate income tax exemption with the IRS. Employ a tax accountant or attorney to assist you with this process. You will be required to write a mission statement for the proposed organization, form a board of directors, and write bylaws for the group.
Reprinted with permission from The Farm to Market Handbook by Janet Hurst and published by Voyageur Press, 2014. Buy this book from our store: The Farm to Market Handbook.
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