Collaborating for Farmers Market Research in Washington State

By: Colleen Donovan       Posted On: March 5, 2014

by Colleen Donovan, Washington State University Small Farms Program

Researching farmers markets can be challenging, especially given their “bottom-up” histories which typically include under-funded organizations, incomplete archives, inconsistent data collection, and multiple definitions for the same terms. In Washington State, market managers, farmers, the Washington State Farmers Market Association (WSFMA), the state department of agriculture, and nonprofits have teamed up with the Washington State University Small Farms Program to research the state’s farmers markets. Since 2009, a Washington “Farmers Market Action Team,” consisting of these partners, has conducted 14 Rapid Market Assessments, Hmong and women farmer focus groups, and two statewide surveys – one for farmers markets and a second for farm vendors. A new “Summary Report: Farmers Markets and the Experiences of Market Managers in Washington State” provides a detailed account of farmers markets’ general characteristics, vendors and products, sales, organizational mission and structure, as well as community and environmental dynamics. A summary report of farmer’s views on farmers markets, based on a statewide survey of all farmer vendors will be released this spring.

Diversity of farmers markets in Washington State
Like many states, Washington has rich diversity of farmers markets, from the world-famous Pike Place Market founded in 1907 to a variety of new markets opening each year. Coinciding with national trends, the number of markets in Washington has grown significantly, quintupling in the last two decades, to approximately 160 unique farmers market locations. In all, 123 markets responded to our statewide survey, representing a variety of sub-regions, ages, sizes, climate zones, and unique community characteristics.

Over a third of the markets in the study could be considered well-established, having operated for a decade or more. The rest were relatively new, with almost 40% having started up in the past five years. Farmers markets were located in 82% of Washington counties, with most concentrated in the Puget Sound region. More than one-quarter (27%) were in King County which includes Seattle. The average market season was 21 weeks long. There are relatively few year-round markets in Washington, though the number of winter markets seems to be increasing.

In our survey, we found that 76% of farmers markets were members of the WSFMA. WSFMA member markets agree to abide by the WSFMA’s “Roots Guidelines” that define five specific vendor categories: “farmer-farmer processors,” “food processors,” “resellers,” “prepared food vendors,” or “artisans/crafters.” If taken in the aggregate, 43% of the state’s vendors were farmers and 32% were food processors. However, each market sets its own policies in terms of which vendor categories to accept. By market, the proportion of the total vendor mix represented by farmer vendors varied from under 25% to 100%. Most farmers markets (48%) had between 26 to 50% farmer vendors and a small number (4%) of markets had exclusively farmer vendors.

There is often an assumption that all farmers markets have exclusively local products. Given the variety of agricultural growing regions and shopper demographics where markets are located, this is tricky to achieve even when it is an explicit market policy to source “locally.” In our study, we found that 58% percent of farmers markets reported prioritizing farmer vendors from a geographic region. As Figure 1 shows, most (61%) defined their geographic preference as a sub-region of the state while 37% accepted vendors from anywhere in Washington State.

Figure 1. Geographic Preferences for Sourcing Products

Evaluating the size of farmers markets is tricky, and our research team ultimately decided to use the total number of vendors on a “typical market day” during the summer season. Of the markets surveyed, most were classified as “very small” or “small” (63%); nearly a quarter (24%) “medium”; and 14% “larger” or “very large” (See Table 1 for numbers of vendors per size category). While we realize that a market’s size is dynamic throughout the season as well as from year to year, the size categories are useful for comparative analysis. For example, median sales for “small” markets were just over $61,000, whereas median sales for “medium” markets were almost $330,000 and over $600,000 for “large” markets. We can also use the size categories to evaluate markets’ capacity to generate revenue, attract external resources, employ staff, sustain their desired vendor mix, attract shoppers, and respond to ever-increasing demands that markets face.

Annual Vendor Sales
For us, being able to reliably report annual vendor sales is a critical piece of establishing, evaluating, and confidently claiming the economic impacts of farmers markets. While we know that farmers markets should not be reduced to economic impacts alone, such data is powerful leverage with policy makers, the state department of agriculture, local economic development planners, City officials, Chambers of Commerce, food policy councils, funders and even to educate markets and vendors themselves. Based on data reported to the WSFMA, the total annual farmers market vendor sales in Washington State are conservatively estimated to be around $50 million. Largely as a result of the early creation of the Washington State Farmers Market Association in 1979, many markets in Washington developed an early emphasis on tracking sales data. In the survey of farmers markets, over 70% reported either tracked or estimated sales data. For these 88 markets, annual sales represent extreme ranges from $1,000 to $5,000,000 (in 2009). Overall, the average vendor sales for all markets were $347,941 and the median was $137,773; 16% of markets reported annual vendor sales of over $500,000. More than half of respondents said that their average farmer vendors’ sales had increased in recent years despite the economic downturn. When asked about perceived competition from other outlets, results were mixed. In general, the most significant competition for sales was viewed as coming from other farmers markets and supermarkets/supercenters. In contrast, Community Supported Agriculture (CSA), community or home gardens, and food co-ops/natural food stores were seen as enhancing more than hurting farmers market sales.

Table 1. Total Annual Sales per Market by Size (2009)

Table 1 also reveals some of the complexity of farmers markets sales. Aspiring to an “average market sales” that can be extrapolated across various scales is problematic. In addition, this data does not take into account the number of market days per year, the number of vendors per market, nor the markets’ potential shopper base. Further, the economic impacts of farmers markets are not limited to vendor sales. For example, 82% of survey respondents reported that their vendors had developed or expanded their business beyond the market within the last three years, demonstrating the key role of markets in business incubation.

The need to increase market capacity
Not surprisingly, most (57%) of farmers markets were incorporated as nonprofit organizations or were projects of nonprofits (17%). Of those that were federally registered, most nonprofits were 501c3. The remaining markets were projects of a government department or agency (9%), a for-profit business or project of a business (14%). This points to the need for additional evaluation of the various ways markets are incorporated and the sustainability of their business models. Over a third (35%) of markets reported having a business plan, and 30% had a strategic plan.

An important piece of markets’ self-sufficiency is the revenue they earn for their own operations. We found that market revenue ranged widely, from under $1,000 to over $100,000 per year, and came primarily from vendor stall and membership fees, followed by grants, donations and sponsorships. The majority of markets (79%) were able to break even with their expenses or come out ahead. Support also came from volunteer labor as well as reduced/free rent, advertising, and local permits. Personnel and staffing accounted for the most significant expenses for markets, followed by marketing, promotions and special events. Whether market revenue is necessarily correlated with a market’s vendor sales is a question we hope to examine more closely.

Overall, we found that 65% of farmers markets in Washington had a paid manager. The likelihood of having a paid manager increased with medium, large, and very large markets; markets with annual vendor sales over $100,000; nonprofit or government-run markets; and markets located in the northwest region of Washington State. Some markets observed that improving their administrative budgets would allow them to improve manager compensation, reduce manager turnover, and enhance overall market management thereby helping ensure the long-term success and sustainability of their markets. Other noted challenges included navigating regulatory barriers, issues with location, and attracting the right vendors and customers. Future goals of respondents include improving markets’ long-term stability through increasing community engagement, attracting key vendors, and expanding their shopper base.

The demands on farmers markets today are tremendous
A variety of community and environmental assets were widely reported on the survey, such as making fresh foods accessible to consumers from a variety of economic backgrounds, creating a focal community gathering point and building a “local culture” around food, farming, and support for independent, locally-owned businesses. For example, 90% of respondents said their markets worked with the federal Farmers Market Nutrition Program to provide shopping opportunities for low-income community members. Over 93% provided examples of how their markets helped the environment.

Importance of collaboration
A research project of this caliber could not have been possible without the strong leadership and commitment of Washington market managers and their market organizations, and especially the WSFMA. The WSFMA’s capacity and the spirit of collaboration among leading market organizations help make Washington a particularly rich participatory research environment. We hope this study contributes to the overall understanding of the diversity of farmers markets, a holistic view of their benefits, the complexity of their challenges, and how to enhance their capacities. We also hope this collaborative research contributes to a richer understanding of the current roles farmers markets play in larger movements to regionalize and democratize food systems.

The report PDF is available in the Farmers Market Coalition Resource Library here.