University of Missouri Extension

G6223, Reviewed November 2009

Starting and Operating a Farmers Market: Frequently Asked Questions
 

Eggplants and peppers, Martha Dragich photo Bill McKelvey
Rural Sociology
Program associate with the Community Food Systems and Sustainable Agriculture Program
Mary Hendrickson
Rural Sociology
Director of the Food Circles Networking Project
Associate director of the Community Food Systems and Sustainable Agriculture Program
Crystal Weber
Community and local food systems development specialist
Jackson County and West Central Region

Farmers markets are gaining popularity in Missouri and across the nation. In Missouri, the number of farmer's markets has more than doubled in the past 10 years. An estimated 131 farmers markets were in operation in Missouri in 2007, compared to 53 in 1997. In the United States, the total number of farmers markets has increased by 82 percent since 1996. The U.S. Department of Agriculture reports that 4,385 farmers markets were in operation in 2006, compared with 2,410 in 1996.

What explains this trend?

Cucumbers and squash, Eric Reuter photoFor starters, growers, consumers and communities are all recognizing the benefits of farmers markets.

For growers, farmers markets provide an opportunity to sell products at retail prices. They allow growers to gain greater control over production and marketing decisions and also provide growers with the opportunity to sell specialty or niche products, products that are limited in quantity, or products of varying quality, such as slightly blemished canning tomatoes. Because the vendor fees charged by markets are much lower than the cost of establishing an off-farm retail outlet, farmers markets enable growers to test new enterprises or give direct marketing a try without making a huge financial investment.


For consumers and communities, farmers markets offer a host of social, economic and health benefits. Farmers markets provide a great place to meet and socialize with neighbors and offer an alternative shopping experience. They draw people out of their homes, help improve neighborhoods and provide an economic stimulus to neighborhoods and downtown districts. Perhaps most important, farmers markets increase access to fresh food, give consumers the opportunity to develop relationships with local growers, raise awareness about the food system and promote healthy eating habits.

What is the purpose of this guide?

Market, Eric Reuter photoThis guide is intended to be a resource for people who are either starting a new farmers market or improving an existing market. The guide follows a frequently asked questions format, provides brief answers to each question and then directs readers to free, online publications that answer the questions in more detail. In addition to addressing questions faced by market organizers across the country, the guide includes information about legal and regulatory issues for farmers market organizers in Missouri.


What are some of the qualities of successful farmers markets?

Based on research conducted by Project for Public Spaces, a nonprofit organization dedicated to helping people create and sustain public places and build community, successful public markets share the following 10 qualities:

These qualities are described in detail in Ten Qualities of Successful Public Markets: 100 well-tested tips on how you can create your own great market, by David O'Neil.

We would like to start a farmers market. How do we begin?

Most farmers markets start as an idea. A group of local growers, a neighborhood association, the local chamber of commerce, or in some cases a single individual, realizes the benefits of starting a farmers market in their community. From this initial idea connections are made, meetings are held, and the farmers market begins to materialize.

During the early stages of the market's creation, when initial conversations and meetings are taking place, try to answer the following questions to help the market get off to a good start. As you begin this process, remember that this does not have to be an intimidating endeavor. This guide is designed to provide answers to many commonly asked questions and help alleviate the burden of searching for resources on your own.

After determining the feasibility of starting a new farmers market, identifying market sponsors and defining the market's purpose, what comes next?

There are a number of ways to proceed with organizing a new farmers market once you have determined initial interest and support among growers, consumers, and the community. However, keep in mind that the steps taken to create a new market will vary from market to market. If you haven't already done so, form a market organizing committee to provide some structure for your process. Also, consider developing business and marketing plans for your market. Other general considerations, as noted in the publication Starting a Seasonal Open-Air Market in Kansas (PDF), include developing the rules and regulations for the market, creating subcommittees within the market organizing committee to handle various tasks, selecting an appropriate location for the market, promoting the market, and helping vendors comply with local, state and federal regulations.

For a detailed description of these and other important considerations, including a sample letter that can be revised and sent to potential vendors, see Starting a Seasonal Open-Air Market in Kansas: A Market Organizer's Field Guide (PDF), by Claire Homitzky and Jana Beckman.

How do we draft the rules and regulations for our farmers market?

It's hard to overstate the importance of good rules and regulations. Typically, the rules and regulations of a farmers market outline how the market will operate on a daily basis, define the rights and obligations of both the market and the vendor, and then provide answers to the following questions:

Baked goods, Eric Reuter photoGood rules and regulations will go a long way toward keeping vendors happy and minimizing conflicts. For a detailed explanation of farmers market rules and regulations, including a look at statements of market purpose and philosophy, provisions commonly found in farmers market rules, issues that may create challenges when managing a market, questions growers' should consider when deciding to join a market, and many examples of market rules from around the country, see Farmers Market Rules, Regulations and Opportunities (PDF) by Neil D. Hamilton.

For examples of rules and regulations from different farmers markets in Missouri, see the Kansas City, City Market Vendor Handbook, the Columbia Farmers Market Rules and By-laws and the Webb City Farmer's Market Rules and Regulations (PDF).


Should our market be a "producer-only" market, or should we allow vendors to sell products that are grown by others?

One of the most fundamental issues addressed in any set of rules is whether to allow the sale of products that are produced by someone other than the vendor. Some market organizers elect to create a producer-only market and only allow vendors to sell products grown on their farms. Other organizers elect to allow for varying quantities of products to be resold at the market. There are advantages and disadvantages with each option. For example, producer-only markets capitalize on the increasing interest in local food and are able to cater to customers who place a high value on supporting and getting to know the local growers in their community. Conversely, markets that allow growers and vendors to resell varying amounts of products grown by other growers will often have a wider variety of in-season and out-of-season products and may appeal to customers looking for convenience. In either case, enforcing the rules may require farm visits by the market manager or board of directors to ensure growers' compliance.

Yet another issue addressed in the market's rules is whether to allow the sale of nonfood items or crafts. If your market intends to allow for the sale of crafts, it is important to use the market's rules to specify which items may be sold and what percentage of the total number of vendors may sell crafts. Farmers markets sometimes allow vendors to sell crafts in order to develop a more diverse vendor base and cater to certain customers. Some markets require that craft items be made from materials raised or collected on the vendor's own farm.

Regardless of which options you choose, it is important create a market that is not only consistent with the stated purpose of the market but also meets your customers' demands. It is also important to weigh your options carefully, survey potential customers about there preferences and consult with market organizers, managers and growers who have experience with many types of markets.

Is it necessary to have a market manager?

Most farmers markets designate or employ a market manager to operate the market. The market manager's duties are typically described in the markets' rules and regulations and include selecting vendors, allocating booth space, collecting fees, enforcing rules, resolving conflicts, and keeping records, among other things. For an extensive list of market manager duties, see Farmers Market Rules, Regulations and Opportunities (PDF) by Neil D. Hamilton, pp. 8 and 9.

What laws or legal considerations should Missouri farmers market organizers or vendors be aware of?

At first glance, the laws and legal considerations that growers and farmers markets are required to comply with may seem overwhelming. However, it is much wiser to educate yourself now and learn how to comply with these laws rather than turn a blind eye and get in trouble at a later date. Make it your goal to learn as much as you can about these laws and get to know the public officials responsible for helping you comply with them.

There are only a handful of state and local laws that need to be considered. They fall within the general areas of taxes, licenses, legal structure, weights and measures, food safety and insurance.

Farmers Market Workshop (PDF), covers the weights and measures topics.

Growers also need to carry their own liability insurance. This can be obtained through one's insurance agent. A $1,000,000 policy is generally sufficient to cover product liability and accidents away from the farm.

As noted by the Good Agricultural Practices program (GAPs) at Cornell University, "food safety begins on the farm." Food can be contaminated at any stage of food production and distribution by bacteria, viruses, parasites and other substances. However, there are ways to minimize food contamination on the farm. For starters, growers should use manure properly and exclude wild and domestic animals from their growing fields. Clean water should be used for irrigating, cooling and washing vegetables. Anyone who harvests, sorts or packs produce must have clean hands. And finally, work surfaces and storage containers should be sanitized after each use. For more detailed information about these recommendations and to see the full listing of GAPs educational materials, go to the National GAPs Educational Materials. Another useful source of information is a presentation developed by the Missouri Department of Health and Senior Services titled Produce Safety — Farm to Table (PDF).

Information from the Missouri Department of Health and Senior Services also notes that there are food contamination risks when handling and selling food at farmers markets. For example, when selling fruits, vegetables or nuts, care should be taken to protect food from not only environmental contaminants such as rain, dirt, and pests, but also from contaminants such as gasoline, pesticides and herbicides, whether during growing, harvesting, storage, transport or sale. Overhead canopies and tables are recommended to keep food protected from environmental contaminants. It is also recommended that chemicals and solvents be stored in sealed, separate containers.

Selling potentially hazardous foods such as eggs, meat, poultry, fish and dairy products requires additional considerations and controls. Most important, controlling the temperature of these foods is the best way to ensure their quality and safety. Eggs should be held at a temperature no greater than 45 degrees F. Meat should be kept frozen. In addition, meat should be processed in a USDA- or state-inspected packing plant.

For foods prepared on-site at a farmers market, a general rule of thumb is that cold foods need to be kept cold and hot foods need to be kept hot. Most foods held at temperatures between 41 degrees and 135 degrees F foster the growth of harmful bacteria. Hand washing facilities must also be provided and utensils and equipment must be cleaned and sanitized properly. A three-step process for cleaning utensils and equipment should be used that includes washing utensils and equipment to remove debris, rinsing to remove soap, and sanitizing using a diluted chlorine rinse. In addition, serving prepared foods at a farmers market generally requires that the food come from a certified kitchen and that the person preparing the food be certified in some way. Check with your city and county health department for details.

Processed and canned foods such as salsa, pickles, relish and sauces must come from an inspected, approved source. However, some exemptions apply for jams, jellies and honey. These products may be produced in one's home if they are made in sanitary conditions, are properly labeled, and the maker of the product is also the retailer. A further restriction requires that the sale of these products does not exceed $30,000 per year. For more information, see the Missouri Revised Statutes, Chapter 261, Department of Agriculture, Section 261.241.

With this said, it should be noted that Missouri is a "home rule" state, meaning that county and municipal governments may enact health ordinances that are more restrictive than the state's ordinances. This means that you should check with both your county and city public or environmental health agency to determine which products are approved for sale at farmers markets in your community and how to handle sampling and food demonstrations. Furthermore, you should make every effort to develop a good, friendly, working relationship with your local health officials. It is counterproductive to take an adversarial position against any particular department or official. Officials have the power to interpret the laws and work with growers and market organizers to find solutions to challenging situations. See a list of county and municipal health departments.

For more information on food safety at famers' markets, there are a host of resources. The Missouri Department of Health and Senior Services has a presentation titled Food Safety: Sanitation and the Value Added Farmers Market Venues (PDF) from which the above information was adapted. You are also encouraged to contact your local public health office.

What types of assistance are available for starting a farmers market in Missouri?

MU Extension has a number of trained staff members who can assist market organizers and producers. To learn about resources available through MU Extension, contact your county extension center.

The Missouri Department of Agriculture also has the staff and resources to assist market organizers and producers. For assistance with developing and promoting your market, contact Tony Anderson, marketing specialist, Missouri Department of Agriculture, at 573-751-2969 or email tony.anderson@mda.mo. If Anderson is not available, contact the Missouri Department of Agriculture Ag Business Development Division at 573-751-4762 or email abd@mda.mo.gov for more information.  Online information can be found at Farmers Market Resources and the Missouri Department of Agriculture blog, Think Outside the Barn.

The Missouri Department of Agriculture also sponsors the AgriMissouri program to promote farmers markets, agritourism and products grown, raised or processed in Missouri. For membership information, go to the website or call 573-522-9213.

An additional resource is the Missouri Farmers Market Association (MFMA).MFMA helps promote Missouri's farmers markets, provides a forum for the exchange of ideas and resources, promotes economic and community development through local agriculture, and participates in educational programs, legislative advocacy, and vendor recruitment. As noted above, MFMA also provides a source of liability insurance for markets.

Are grants or other types of financial assistance available for farmers markets?

The U.S. Department of Agriculture lists a number of federal, private sector, and foundation grant opportunities in the Farmers Market Consortium Resource Guide. The guide includes grants for market development, producer training and support, consumer education and access, and market promotion.

However, it is important to understand that farmers markets cannot be sustained by grants alone. Just like any other business, farmers markets have to generate sufficient revenues to stay in operation. During the initial stages of your market's development, the market organizing committee should develop a business and marketing plan to clearly define a plan for sustaining the market without grants. Also, keep the Ten Qualities of Successful Public Markets: 100 well-tested tips on how you can create your own great market,by David O'Neil, in mind as you develop and grow your market.

What are farmers market customers looking for? What attracts them to a market and keeps them coming back throughout the season and from year to year?

Marketing and promoting a farmers marketing creates unique challenges for market organizers, in part because customers are looking for a variety of tangible items and intangible qualities at the market. For example, according to The New Farmers Market, by Vance Corum, Marcie Rosenzwieg and Eric Gibson, farmers market customers are looking for fresh, high quality, locally grown products; reasonable prices; an enjoyable and social shopping experience; and "vibrant farmer personalities."

As a market organizer, you are in a unique position because on the one hand, you have to rely on individual vendors to do a portion of the marketing. Marketing considerations such as product quality, variety and display; customer service and personality; and pricing are generally left to vendors, although stipulations can be made in the market's rules and regulations to govern certain aspects of these considerations. On the other hand, you are responsible for promoting the market as a complete package and creating a positive, vibrant market atmosphere using special events, the media and community partnerships. Ultimately, balancing both the individual and collective marketing efforts requires flexibility, patience and creativity. It may also require working with individual vendors to help them improve their own marketing skills.

A publication from the Kansas Rural Center titled Marketing the Market (PDF), includes a number of marketing and promotional tips for growers and market organizers. The guide includes information concerning basic marketing principles, building partnerships with local media and businesses, salesmanship, merchandising, creating a lively market atmosphere, promoting the market and communicating with customers.

For additional help with marketing farmers markets, contact Tony Anderson, marketing specialist, Missouri Department of Agriculture at 573-751-2969 or email tony.anderson@mda.mo.gov. If Anderson is not available, contact the Missouri Department of Agriculture Ag Business Development Division at 573-751-4762 or email abd@mda.mo.gov for more information.

Finally, consider developing a marketing plan for your market. Even if the plan is basic, it can help you put your marketing ideas into action and keep your market on track.

Are there any additional resources available to help individual growers develop marketing and selling skills?

Carrots, Martha Dragich photoMany growers are intimidated by the prospects of marketing and selling their products. However, despite these fears, growers should try to develop at least a general understanding of marketing and selling or be willing to recruit family members or employees who can market and sell with confidence. In addition, because farmers market customers expect growers to be a source of knowledge about products, production methods, and food storage and preparation, growers should be willing and able to talk with customers about these and other topics.

A number of resources are available for growers who wish to develop their marketing, selling and personal communication skills. For information about direct marketing, enterprise evaluation and conducting market research, see Direct Marketing, by Katherine Adam, Radhika Balasubrahmanyam and Holly Born.

For information about selling and personal communication, see the MU Extension publication G6222, Selling Strategies for Local Food Producers, by Bill McKelvey, Mary Hendrickson and Joe Parcell. This guide offers practical advice on building relationships with customers, discovering customers' preferences, being an advocate for one's products and providing great customer service.

What are some of the challenges of maintaining a viable farmers market?

A 2006 report published by Oregon State University Extension, titled When Things Don't Work: Some Insights into Why Farmers Markets Close (PDF), takes a close look at an often-overlooked fact — despite the recent growth and popularity of farmers markets, many new and small markets don't succeed. In the report, the authors identify five factors that are often associated with markets that fail:

  1. Small size
  2. Lack of farm products
  3. Little administrative revenue
  4. Low-paid or volunteer market manager
  5. High manager turnover

In addition, the report identifies areas of risk and makes recommendations for farmers market organizers.

Are there any farmers market organizations or associations that our market can join?

Associations of farmers markets and other direct marketing ventures exist at the state and international levels to assist growers and market organizers. As noted above, at the state level, the Missouri Farmers Market Association is a valuable resource for market organizers and growers. At the international level, the Networking Association for Farm Direct Marketing and Agritourism (NAFDMA), works to improve farm income and promote farm direct marketing through education, networking, advocacy, research and innovation.

How can we collect information from customers to evaluate the market's performance?

Collecting sound information, in a systematic way, can help you identify the strengths and weaknesses of your market. It can also help you make improvements in both the daily operations and long-term planning of the market.

Researchers at Oregon State University have developed a simple, inexpensive set of tools to help market managers and organizers assess a market's performance. The publication Tools for Rapid Market Assessment (PDF), by Larry Lev, Linda Brewer, and Garry Stephenson, outlines the procedures for conducting attendance counts, facilitating customer surveys and using a team of external market reviewers to make observations about a number of the market's attributes.

How do we manage the day-to-day operations of the market?

In large part, the daily operations of your farmers market will be dictated by your rules and regulations. However, the market manager is usually given the authority to interpret and enforce the rules and regulations and handle the day-to-day concerns of the market. In The New Farmers Market, Vance Corum, Marcie Rosenzwieg and Eric Gibson discuss a number of managerial tasks that may need to be addressed. On the actual day of the market, these tasks include the following:

In between market days, the market manager may also be involved in the following:

Summary

Starting and operating a farmers market can be an exciting, satisfying and worthwhile endeavor. It does not have to be intimidating, especially if you remember to keep things simple, enlist the help of others and practice good communication. This guide was developed to make your process easier and address a number of commonly asked questions posed by market organizers. By following this guide and using the resources provided throughout the text in your own community, you will have the tools needed to develop and grow a successful farmers market. Good luck.

The authors would like to acknowledge the assistance of Lane McConnell and Eileen Nichols in the preparation of this guide.

References

Other Web pages

G6222, reviewed November 2009

G6223 Starting and Operating a Farmers' Market: Frequently Asked Questions | University of Missouri Extension

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