How to Start a Farmers Market

Part 1 - How to start a Farmers Market business - Background

As the creator and manager of a farmers market, you’ll create an environment where you bring the growers and producers of local farm-related food and non-food products to the food- and health-conscious public. You will need to find sellers, rent stalls and deliver a customer base in a convenient location for buyer traffic.

Our guide is in 3 parts:

• Part 1 - How to start a Farmers Market business - Background
• Part 2 - Our planner tool to see if this idea is the right fit for you
• Part 3 - Action plan to get started

What are the costs involved in opening a farmers market?

Many farmers markets operate as nonprofits. In fact, in the state of California, food markets can only get certified if they’re run by a government, a nonprofit or a farmer. And since the market will only generate revenue from vendor fees, there’s not usually a large revenue stream. Furthermore, it’s only a seasonal business in most parts of the country.  

That’s why it’s important to hold down costs as much as possible. Learn more about typical costs here.

Location rent — Zero to $6,000 or more. Your best option from a cost standpoint is an open market on public spaces, such as at a park or community area at no cost. If you must rent interior space, such as if you plan to operate your market year-round, the cost can go up quickly. 

Employees — Zero to $15 an hour or more. In most situations, you will act as market manager, with a team of volunteers. But if you must hire a part-time manager, you might easily have to spend a few hundred dollars a week. 

Licensing and liability insurance — $1,000 – $3,500 est. Your licensing needs will vary depending on your state or municipality.

Marketing — $500 or more. This might include a website and social media, signage and advertising costs to attract customers.

Professional services — $500 or more. Consult with a lawyer to draw up vendor contracts and make sure you’ve satisfied all regulatory demands.

What are the ongoing expenses for a farmers market?

Hopefully, once you’ve gotten your business started, there won’t be many ongoing expenses. If you can recruit volunteer assistance, you’ll perhaps only pay for a market manager if you hire someone to take on that responsibility.

Who is the target market?

Your customer profiles can vary depending on the audience you hope to attract. If you open for business in an inner city food desert, your customers will be area residents of shopping for affordable groceries. If you’re opening an organic food market, you might appeal to “foodies” who are concerned about nutrition and locally grown produce. And if you open in a tourist location, you might most appeal to out-of-town visitors who are into the experience of shopping at a new location.

How does a farmers market make money?

Your income will be derived, in most cases, from the fees you charge vendors for a place in your market.

How much can you charge customers?

Your vendors might only pay $10 to $20 per day, and you might only be open on seasonal Saturdays. You should start your operation with a minimum of six vendors.

How much profit can a farmers market make?

That will depend on the number of vendors you can recruit and the foot traffic you can generate. If your vendors see continued value in selling in your spaces, they’ll come back.

How can you make your business more profitable?

If you see significant foot traffic, consider open a stall yourself. This is a particularly appealing idea if you are a farmer, but you could also buy and sell such related products as herbs and spices, spaghetti sauces, salsas, etc.

What happens during a typical day at a farmers market?

Your typical day could involve any of the following responsibilities.

• Recruiting new vendors and meeting the needs of current vendors

• Posting to social media and undertaking other marketing efforts to attract customers

• Staying in contact to maintain solid relationships with your local government contacts and volunteers

• Taking on the day-to-day financial responsibilities in maintaining your farmers market as an ongoing venture

Day-to-Day and Growth

What are some skills and experiences that will help you build a successful farmers market?

You must have keen sales instincts and the ability to deal diplomatically with local governments and regulatory agencies. Your first, and perhaps most challenging, task will be finding a location. This is often on municipal land, and you might field objections from retailers, such as supermarkets, convenience stores and other food markets staving off competition. The municipal government might also be wary of an increase in vehicle traffic, noise and mess.

You must also be able to sell your idea to vendors and figure out how to get the word out to customers.

What is the growth potential for a farmers market?

With the popularity of cable food channels, the locally grown food movement, the appeal of organic food and other factors, food markets have seen the addition of more than 2,000 farmers markets nationwide since the mid-1990s. However, several obstacles can impede success. 

One important limitation is your market’s physical space. It will only hold a limited number of vendors, so your key to growth must be a buildout at your current site or additional locations.

What are some insider tips for jump starting a farmers market?

It’s your mix of vendors that will attract and retain customers. Make sure you have all of the basics covered, including the fruits and vegetables that shoppers expect to find at your location, and then recruit vendors who can sell related but unanticipated products. For instance, the sellers of coffees, spices, flowers, soaps, candles, or arts and crafts could generate additional interest. Live entertainment might also add to the atmosphere. If the musicians can be persuaded by foot traffic to only play for tips, they’ll be no additional cost to you.

How and when to build a team

You might start your business alone and only hire a market manager, or market master, when you can afford the help recruiting vendors and maintaining smooth operations during market days. Volunteers will hopefully help with cleanup and vendor needs.

Part 2 - Is a Farmers Market business the right fit for you?

Part 3 - Action plan to launch your Farmers Market business in 90 days