7 Tips to Sell at a Farmers Market
Consumers care more than ever about where their food comes from. If they can meet the person who grew it or raised it, they’re much more interested in making a purchase. That’s why so many vendors want to know how to sell at a farmers market, as these forums provide a convenient way for many people to do their weekly grocery shopping. Better still, farmers markets also make it easier for sellers to bring their goods directly to consumers—all while cutting out the middleman.
If you want to know how to sell at a farmers market, there are a few things you need to understand before you get started. The real path toward successfully selling at a farmers market has to begin with starting your business, as well as obtaining any licenses and permits required in your area. You’ll also want to think about other elements of your business, as well, such as payment methods, branding, and small business financing.
Here’s what you need to know about how to sell at a farmers market, as well as some tips and tricks about setting up your business for sustained success down the line.
How to Sell at a Farmers Market Business in 7 Steps
Although your local farmers market may look like a quaint, no-frills operation, there are a ton of factors you’ll need to consider before you sell at a farmers market yourself. Every market has different rules, costs, and operational requirements. This goes for town, local, and state-level regulations as well. Knowing what your requirements are ahead of time can help you avoid unexpected hassles along the way—the likes of which could even stop you from getting your wares to the public through long delays and procedural headaches.
Besides knowing the rules and requirements of selling at a farmers market, you’ll also want to think of more personal business questions for your operation as well. Selling the basics—such as fresh produce or baked goods—may not be enough to differentiate yourself from the competition. Plan out what you want to sell, what your competition is already offering, and how you plan to set up your farmers market business to make it unique for customers.
Here’s what to factor in as you set up your farmers market business well before you stock your tables and get to selling.
1. Decide What to Sell
It might seem like a no-brainer to sell vegetables and other perishable provisions at a farmers market. However, most of these items are already available from existing merchants—some of whom may have a dedicated customer base, too. Produce is the backbone of any successful farmers market, but the real draw for consumers is often unique goods and foods that are harder to come by.
The best way to differentiate your farmers market business from your competition is by having a mix of loss-leader products, such as fruits and veggies, and unique items that are only available at your stall. The more you can differentiate yourself with one-of-a-kind goods, the better your odds are at making higher margins and creating a following that comes to the local market every week to visit your booth and make a purchase.
If you’re not sure what to sell, or what your differentiating products might be, a quick look through your local farmers markets can give you insights into which items move quickly. You can also get a sense of what kind of interest there is in goods that aren’t food-related, such as candles, soaps, or other crafts. Pay attention to who is already selling items you’d stock, how much foot traffic specific vendors get, and what they sell, among other key observations.
2. Develop a Business Plan
Once you’ve done your research and have a sense of what you’d like to bring to market, you’ve laid the groundwork for putting together a business plan to influence how you’ll sell at a farmers market, as well as your pricing and business model. A robust business plan helps any kind of business position itself for success by taking the guesswork out of how you intend to run your company, sell your products, and find a pathway toward profitability.
A good business plan should incorporate a few must-have components, including an all-important section about your finances. This should go over your start-up capital, anticipated expenses, expected revenue, and any resulting profits. Should your financials change over time (and they likely will), you can always update this information to keep your plan up to date later.
Your business plan should also have a section dedicated to your company’s strategy. You’ll want to go into detail about why you’ve started the business, how you intend to turn a profit, what your competition is doing (and how you’ll set yourself apart), and what niche in the market you’re filling.
Bear in mind that you may have already done this work if you run a farm or business that predates your interest in selling at a farmers market. If this is the case, you may only need to update the business plan you’ve already put together. If not, and you’re starting from scratch, consider using a business plan template to take some of the guesswork out of the process.
3. Choose a Business Entity
Forming a business entity is the first (and perhaps most important) legal step to take when getting your farmers market company ready to operate. Depending on where you live and work, you may be able to sell at a farmers market with little more than a sole proprietorship set up for your business. Sole proprietorships are the easiest ways to establish a business: They are unincorporated businesses owned by one person, who is therefore responsible for all profits, losses, taxes, and liabilities. You rarely need to register a sole proprietorship with government bodies, which means less waiting on paperwork to come in before you can start selling.
Although sole proprietors are tempting for small business owners with uncomplicated finances, there are tons of liabilities—both financial and legal—that come with running a business as a sole proprietorship. Since there’s no legal distinction between yourself and your business, you’re personally liable in the event that your company can’t repay debts or is sued by another party.
LLCs offer stronger protections in this arena, as they make it easier for people to separate their personal and business finances. Liabilities also end at an LLC’s finances and legal framework, rather than extending into an owner (or owners’) personal affairs. This gives owners better protection of their own assets in the event that the business runs into trouble. You can still file your business and personal taxes together depending on what kind of LLC you establish, just like you would with a sole proprietorship. Plus, you can include one or more business partners in your venture through an LLC, which you can’t do through a sole proprietorship.
4. Register With Your Farmers Market and Secure Permits
Once you know your intent for your business, scoped out the competition, and detailed the financial factors involved in getting your venture up and running, you’ll need to make sure you’ve gotten all the right documentation, registration, and licensing required to sell at a farmers market near you. Every area has different rules about what businesses need to have filed before they can sell food and other goods to the public, so be sure to check in with your local officials and use this as a preliminary guide only.
Selling prepared food, produce, and other related goods are often subject to extra scrutiny by local and state government agencies. Every location differs in terms of what it wants from vendors: New York State has different requirements depending on the manner in which products are sold—such as selling cut flowers versus plants. Since you will have already determined what you want to sell, you should be able to determine the right requirements by checking in with your local and state agencies for more information.
5. Brand Your Farmers Market Business
Farmers markets are, by and large, pretty homespun-looking affairs. That doesn’t mean you shouldn’t brand and advertise your business, however. The sheer amount of competition from your fellow vendors means you’ll want to pay close attention to how your stand looks to passersby. This means developing a striking logo, arranging products in an attractive manner, and even telling customers a story about your farm or business.
People often go to farmers markets because they want to feel connected to the products they’re purchasing. Good branding helps tell that story in a way that is concise, engaging, and lucrative. Even a simple website or social media presence can help you keep people informed of where and when you’re selling and can help you cultivate passionate customers who want to go beyond their purchases and know more about your business.
6. Set up Business Bank Accounts
Making money from selling at a farmers market is essential; having a place to store your cash is equally important. Even cash-only businesses still need a safe place to store their money, making it crucial that you set up at least a small business checking account for your farmers market operation.
Opening a small business checking account is a straightforward process. If you’ve registered your business with local and state officials, you’re ready to apply for a business bank account too. Most business banking providers want to know that you’re on the books with any legally required bodies to get the process started. From there, you might also be asked to provide personal financial information, such as the social security numbers of yourself and any additional business partners.
A business checking account gives you a convenient place to park your operating cash, make and accept payments, and keep track of your finances more efficiently. Plus, if you have excess capital, you can always set up a business savings account with the same provider as your checking account. Additionally, you can pursue a business credit card with your banking partner to keep your business spending separate from your personal finances and build your business credit history.
7. Decide How to Take Payments
Cash may be king—especially at farmers markets—but consumers expect to be able to go cashless just about everywhere these days. Thankfully, there is a wide range of mobile payment platforms that make it easier for even the smallest of small businesses to accept plastic in addition to cash.
Plus, mobile POS systems are inexpensive to operate. Most companies provide the option for per-transaction fees, which take the form of some percentage of the total amount of the purchase made through the device. For higher-volume users, some providers also offer monthly fees in lieu of per-transaction fees.
The Bottom Line
Farmers markets are a great venue to sell directly to customers: They help companies forge real connections with consumers and make it easier for people to buy fresh produce and goods. Setup costs are minimal—usually only consisting of the market’s fees and other assorted costs depending on where you’re selling. With the right business framework in place, you can get your farmers market business up and running in no time. All you need to do is a bit of paperwork, a fair amount of research, and a bit of preparation in order to put your best foot forward.
Sally Lauckner is the editor-in-chief of the Fundera Ledger and the editorial director at Fundera.
Sally has over a decade of experience in print and online journalism. Previously she was the senior editor at SmartAsset—a Y Combinator-backed fintech startup that provides personal finance advice. There she edited articles and data reports on topics including taxes, mortgages, banking, credit cards, investing, insurance, and retirement planning. She has also held various editorial roles at AOL.com, Huffington Post, and Glamour magazine. Her work has also appeared in Marie Claire, Teen Vogue, and Cosmopolitan magazines.