Market Manager Study Offers Snapshot of Market Characteristics

      Posted On: July 29, 2009

By Caroline Rendon
FMC Volunteer
Des Moines, IA

Data collected by USDA over the last ten years clearly demonstrates an increase in the number
of farmers markets nationwide. But are there consequences to having a prevalence of so many young markets? A newly released study from the Agricultural Marketing Service shows that in 2005, more than 30% of farmers markets in the U.S. were younger than five years old.

On May 26th, an FMC member conference call (‘The Flip-Side of Success’) generated a great deal of discussion on this very issue. “I get requests all the time from people who want to start markets,” said Suzanne Santos from the Sustainable Food Center in Austin, Texas. “Often there’s not a lot of research done…and it’s a burden on the farmer to attend too many markets. I know of at least two or three smaller markets that have failed due to poor publicity or operations in the last few years.” Members around the country expressed similar observations, citing eagerness in many communities to start markets and, in some cases, an unfortunate lack of feasibility research and supply analysis required to make them grow and prosper. The new report, USDA National Farmers Market Manager Survey, offers some context for such anecdotal evidence.
The survey results also show a slight decline in weekly market attendance across the country
between 2000 and 2005, and farmers markets operating for fewer than five years consistently
showed lower monthly sales, had fewer vendors, and drew smaller weekly crowds than the average market. While total annual market sales increased from $888 million in 2000 to approximately $1 billion in 2005, this growth is not proportional to the increase in the number of individual farmers markets, which increased by 43% in the same time period. Furthermore, average sales per market appeared to fall slightly between 2000 and 2005.

Ed Ragland, lead author of the report and Economist with the USDA Agricultural Marketing Service’s Farmers Market and Direct Marketing Research Branch, notes that “farmers markets continue to grow at a strong rate. However, the rate of growth in the number of farmers markets has slowed. This may be an indication that the sector is starting to mature and as a result managers of new markets may be finding it harder to establish new market locations. Survey data showed that newly established markets have not been able to generate the economic activity of older markets, raising questions about whether current levels of growth are sustainable.”

Even so, the survey reveals that most markets are either financially self-sufficient (insomuch that they depend solely on vendor fees to operate) or well on their way. For markets that were not self-sufficient, top sources of funding were vendor fees, city or county governments, and non-profit organizations. Self-sufficiency was more likely as markets grew older: 32% of markets under five years old were self-sufficient compared with 59% of those twenty years or older.

The survey shows that several factors contribute to market success. Market location is a critical factor as more successful markets are located in densely populated urban areas. Successful markets also feature a wide variety of products for sale, are open for extended seasons, and offer organic goods. Markets with paid market managers also show higher profits and attendance. Remarking on what new market organizers might learn from the report, Ragland says, “As market organizers seek to establish new markets it is increasingly critical that they find out what products customers want, coordinate with local farmers and vendors to ensure a dependable supply and variety of products that potential customers desire, coordinate with town and/or city leaders regarding rules and regulations that may affect the market as well as soliciting their support and guidance, seek advice from local extension agents, get local business leaders involved with locating the new market and last but not least locate the farmers market in an area that is convenient to customers and their shopping needs.”
Only 39% of surveyed markets reported having a paid manager and 22% reported employing
other paid workers. Nationwide, farmers markets reported heavy reliance on volunteer labor, with nearly 60% of markets relying exclusively on volunteers.

Seasonality is another important element of market success. The majority of markets in the U.S. are open between three and six months annually, with year-round markets composing only 12.1% of markets nationwide. Ragland agrees that this is the most surprising discovery in the data. “Markets that operated seven months or more reported almost twice the number of vendors, almost three times the amount of sales revenue per month, and almost twice the number of customers per week, compared with markets open for six months or less.” He speculates that “The higher level of performance of these markets may be due to the availability of fresh products early and late in the growing season, which can command higher prices because fresh local products can’t be found elsewhere, or by the availability of more value added shelf-stable products.” Again, there is wide regional variation: year-round markets represent 35.4% of the Far West’s markets but just 3.5% of the Northeast’s. The study shows that not only does population density positively affect market sales, it also influences managers’ decisions to extend the marketing season.

The survey also asked market managers what operational issues they felt most needed improvement.
Survey respondents across the country consistently reported similar concerns; the top three issues identified were support for advertising and publicity; strategies for overcoming low customer attendance; and strategies for boosting vendor sales. If provided with market assistance, managers would use it for market publicity, local foods promotions, and targeting customers.

Acknowledging that the report represents a snapshot nearly four years old, Ragland speculates
that since 2005, “I expect that the value of sales, as the result of the Women, Infant and Children Farmers Market Nutrition Program (FMNP) and Senior FMNP vouchers, as well as Supplemental Nutrition Assistance Program benefits, has increased significantly.”

Survey respondents included 1,292 farmers market managers throughout the U.S. in 2005, representing a little over 30% of the total number of farmers markets in the country that year. The full report (112 pages) can be read on-line at