May 11, 2012

State of Alabama
Press Release: Alabama Department of Commerce

More Farms Vie for the $1 Billion Spent at Farmers Markets

May 10, 2012


More Farms Vie for the $1 Billion Spent at Farmers Markets

On a recent May morning at the Collingswood (N.J.) farmers market just outside Philadelphia, Jim Daily is neatly switching back and forth between bagging tomato plants and asparagus bunches and talking tomatoes with bleary-eyed customers. It’s about breakfast time on the first weekend of the market, and in the misty coolness, hundreds of people are milling around, eyeing pints of strawberries, heaps of carrots, and other local goodies at dozens of stands.

The next day, Daily, 73, who works for his daughter and son-in-law’s 150-acre fruit and vegetable farm, A.T. Buzby, about an hour south of Philadelphia in Woodstown, N.J., will set up at the Head House Farmers Market in Philadelphia, under an ancient brick shed a few blocks from founding father Ben Franklin’s old house. Franklin might have shopped at Head House in the 1700s, but for the Buzbys, farmers markets are a new destination.

For the past three decades the Buzbys have sold their fruits and vegetables to wholesalers and didn’t consider trekking to the handful of far-off farmers markets. A few years ago, when a bunch of markets opened near their farm, they started to experiment. Now Daily’s daughter, Dawn Buzby, estimates that about 20 percent of her annual $1 million in revenue comes from the four markets they sell at weekly. “People are more aware of where their food comes from, which helps us selling retail, plus the wholesale market is more precarious because distributors now seem to buy from everywhere,” says Buzby, who employs about 20 workers during her peak season. “The time was just right for us to exploit farmers markets.”

There are 7,175 farmers markets in the country—twice the number in the mid-2000s, according to the U.S. Department of Agriculture. While a growing breed of consumer hungry for locally sourced food is obviously contributing to the uptick, competition from foreign and domestic agribusiness is also encouraging more independent farmers to try direct retail, says Larry Lev, a professor in the department of agricultural and resource economics at Oregon State University. “The price difference between selling direct at a farmers market and selling through a distributor to a supermarket is huge,” says Lev. “The usual markup at a supermarket is 100 percent, but if you have a distributor, that will take a big chunk out.”

Over the past five years, Melissa Allen and her brother, Shawn Garretson, came back from college to become the fifth generation to help run the 200-acre Beechwood Orchards in rural Biglerville, Pa., west of Gettysburg. Their father had sold almost all their apples, peaches, and other fruit to wholesalers, but they wanted to start retailing. They now go to as many as 14 farmers markets a week as distant as Leesburg, Va., and Philadelphia, each about three hours away, accounting for half their annual sales. “The future looks bright,” says Allen. “We have started to grow different crops. This spring we even ordered figs. [Selling direct to consumers] is a new way to do things at a farm that has been around 100 years.”

It is a hard way, though. Instead of just waiting for the wholesaler’s truck to show up at the farm, Daily, for instance, loads up his van at 6 a.m., rain or shine, picks up a couple of teenage helpers, and gets to a market early to set up three tents and several tables. He keeps a ledger book by hand and makes sure what is sold is accurately recorded. By noon, the frantic selling is usually over, and he packs up, home by the evening.

Jonathan Ray grew up on what was then a dairy farm, Cates Corner Farm in Hillsborough, N.C., near Chapel Hill, owned by his family eight generations back under a land grant by the King of England. After earning a degree in agribusiness from Appalachian State University in 2009, he set about changing the 200-acre farm to improve its chances of surviving.

His strategy: take advantage of increasing suburbanization of the area by catering to individuals willing to pay more for local produce. “We started growing more smaller crops two years ago and going to farmers markets,” says Ray. He was impressed with the customers’ knowledge of food and their desire to get something just picked a few miles away. “It is a good time to connect with your customer base, to see what they will buy, and it is a social time, to get to chat with other farmers for other ideas,” says Ray, who works the farm with a handful of family members. He estimates that about 60 percent of the farm’s “low six-figure” revenue comes from selling at farmers markets.

Despite the steady increase in the number of farmers markets, only about 2 percent of farm sales in the U.S. are retail. That is still about $1 billion annually at farmers markets, according to a 2011 estimate by the USDA. Nicky Uy, a senior associate at the Food Trust, a Philadelphia nonprofit that supports local agriculture, says farmers who’ve had success at markets are also finding other venues for selling directly. She says the young farmers she works with at the 26 markets the Food Trust organizes “are willing to try new things, new products, interact with customers. It bodes well for the future of small farms, especially near big cities.”

Jeffrey Frank and Kristin Illick, who own and run Liberty Gardens in Coopersburg, Pa., near Allentown, sold at farmers markets for 10 years but stopped three years ago, after they developed a business selling to high-end restaurants, mostly in New York City, an 80-minute drive away. “We liked retail, and then we saw a chance for niche—chefs want things home cooks may not have an interest in, like microgreens and rhubarb and chard,” says Frank. “It is a dynamic time for farms, and if farmers markets can excite people about good food, it is fortunate for everyone.”

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