Saturday, April 10, 2010

Starting a Little Produce Business at Your Local Farmers Market -Tips

Dear Folks;

First a Note:

I felt that this information was too important to just share with one person  who asked me about how to set up as a vendor at a Farmers Market.

So I decided to write this short little article of tips that I have learned in the short time I have been a vendor at the HomeTown Market here. I will also be putting it on my 2 yahoo groups. So.  You got it first second since this did start out as an answer on one of the garden groups I frequent. 

If you find this useful, an acknowledgement would be appreciated. If not, never mind...

If you have any tips, please let me know and I will add them to this new on-going bulletin. Our own HomeTown Market suddenly begin to flourish with the opening of the third year last year. Hopefully, it will be expanding in days and perhaps into evenings. Depends on the powers that be here. I'm in a learning process myself but it is fun. To make a little money. Meet a lot of great people. Share a few gardening secrets. Make a few new friends. You can't beat that with a stick! ( Clich's - I have a basket full ...)

In a few weeks, around the end of May, our own HomeTown Market will be opening and I will be participating and talking with other produce vendors. Hopefully, I will be able to flesh out these Marketing tips better. If you have questions, let me know and if I don't know the answers, I will try to find them out for you!

Happy Gardening Folks!



I am not an accountant, this is just information that I have picked up along the way and I am passing it on. Your experience and situation may be completely different from mine. Find an accountant or friend who can expand on the financial set-up necessary if you are really serious about starting a small business of any kind. I assume you are starting on a shoestring and this information might help get you started in the right direction. Good Luck in your Marketing Endeavors.

First thing, get yourself a bound Notebook. The IRS doesn't want records of income/expenses that you can delete, remove sheets, etc. that can't be detected. In one section, put the date and amount of every penny you bring in.

In another section, keep a record of every penny you pay out. Make sure you get a receipt for everything you buy for your new sideline Farmers Market Business. Including Booth Rental, Packaging, etc. etc.

This a simple Cash bookkeeping system. Ask an accontant or bookkeeper to set you up if you need help. Also, If you don't feel comfortable setting up your own simple bookkeeping system,  go to any office store and tell them what you need. They usually have Journals you can buy. Even complete "systems" to set up a small business. Ask. They will help you.

 At the end of the tax year, take this record with you to your tax preparer when you fill out your regular taxes. The tax preparer will know how to add this information to your regular tax form. It's not that hard. And you may be able to benefit from it. Or if you do your own taxes, read the manual carefully as to how to report this extra income/expenses etc. It's usually right there in the tax manual.

You don't need a cash register but you do need to have an honest and reliable person taking the money and making change for customers. To start with, that is probably You.

I would start out with at least $25 to $50 change in small bills and change until you see how much business you will do on a regular basis. Use common sense. Make a note every day of the amount of money you took in. It should all be there in your Change box. At the end of the day count all your change, checks etc,(I would take cash only at least to start) and subtract your morning starting change from the total = Gross Market Income for the day. Put this number in your Notebook and date it as explained above.

You should also set up a petty cash fund. This is money for miscellaneous items, pop, coffee, a light bulb, etc. Put this in a seperate envelope or box. This is solely for your use. Keep a record.
Say you put in $10. If you buy a candybar, write down the amount.
at the end of the day keep the dated record and make a note of the amount spent. The next time you will put in this amount to bring your petty cash amount to the beginning $10 level. And so on. The amount spent in the petty cash fund is usually deductable at the end of the year if it is reasonable. You won't be buying a New Truck from the Petty Cash fund. Remember, keep a running total and what you spent in a record along with the other financial records of your business. That is about as complicated as I can get on this topic. If you grow, things can get very complicated and you should hire a good bookkeeper or accountant to help you out with this and keep you out of trouble.

Call up your state Treasury office and get a sales tax number if you need one. Tell them your circumstances to see if you need one. Find out how often you need to send in the sales tax you collected. Monthly, Quarterly, Annually? Tell them what you are doing and how much money you expect to bring in. They will work with you to set up an appropriate schedule. You may not even be required in some states to collect sales tax.

The organization that runs the Farmers Market in you area will also have a fee. Or maybe not. Mine charges a one time fee of $30 for the use of a booth every Saturday from June to September. Yours may charge $5 dollars a day. There seems to be a lot of variation on this.

The Farmers Market Manager will probably give you a sheet of rules etc. that they expect you to follow. You can find out what they are when you call or go to sign-up. Feel free to give them a call if you have any questions. They will be glad to help you out, I'm sure. They want you there. No matter how small your produce business is in most cases, the more vendors the better the market!

Most of the time you will have to furnish your own table or chairs. Some Markets rent them for a small fee. Ask. You can buy a long folding leg table for as low as $25 or as high as $169. Check your local Big Box Store or borrow from your School or Church.

I had a nice card table and a folding chair to sit on my first day. Be sure you have shade or bring your own portable shade. Camping Canopes are in the stores now. Check the camping section at Wally World or KMart . You can get these on sale for as low at $25 or as high as $200. Shop around.

Display your Produce at least as well as everyone else. And, If you can, just a little bit better. I would recommend washing everything well. Trim off dead leaves (Onions, Radishes). Don't display bruised items. If you are wandering if that spindly radish or mishapped cucumber is good enough to sell, you probably shouldn't.

Like any good merchant, you should build a reputation of Quality. Keep everything neat and orderly. Make sure it looks morning fresh (and looks, feels and tastes like it, The better your produce is in comparison to everyone else, the more you can charge. People will pay a premium price for premium produce. They have learned that from all those cooking shows on the Food Network!

You can always reduce your prices if they are too high for your locals taste and budget.  It is extremely hard to raise prices later if you find you are loosing money!

But. At the end of the day, Reduce your prices to sell out - fire sale prices if you have to. You don't want to drag anything back home. Or just take it to a foodbank and give it away immediately. Don't hold it over for another day if it is going to loose it eye-appeal or flavor or in anyway lower its quality.

If you have to leave before the day is over, ask one of the other vendors if they would be interested in a good deal. Sell you stuff to Him at a price he can make money at. You will both benefit. Especially if you have nice stuff! 

Put up neat little signs. Don't make people guess at what you have. Speak to folks as they walk by. Talk up your produce. Say, "Picked this Morning Fresh". Or, "Field Fresh".  Make sure your product looks it. Hand out a free recipe showing how to use Leek in cooking if folks in your area are unfamiliar with it and you have a truck load to unload. Be sure to include your Business Name ( You need to think of a good one), telephone, and address if you want them to know. Also a website if you have one. Never sell an item without including something with you phone number on it. This builds sales with practically no advertising cost.

Be friendly, Be Clean, Make a nice big sign for your booth. Hang it up above your booth or set it down in front of your display table. (Colored Chalk on a Kids Chalk Board can look good. Large poster boards can be purchased for about a dollar. Use bright colors and large lettering. Stand back 20 feet and see If you can read the sign(s) Easily. Don't make window shoppers have to strain to read your signs as they walk by. Pretend you are a new customer to a Farmers Market. What questions do you need answered before you would even consider approaching a booth. Small signs on the display table or stuck to a corner post can draw them in.

Also, ask yourself, why should a potential customer buy from you rather than the vendor next door? Find the answer, work with that and you will stand out from the crowd and double you customers.

Don't try to sell "Organic" unless you get certified by your state. You can tell people that you use organic methods - if you do.
Do not represent yourself. You should also tell them that you are not a "Certified Organic" grower if they ask. Don't misrepresent yourself or your product.

You can't call your produce "Organic" if you are using non-organic weed killers or fertilizers etc.  You might want to check with your state to see if your garden produce land, etc. can get certified and what you would have to do to get that done.

It may not be as hard as you think - and could pay off big time! "Organic" is big everywhere in this country (US). Even the regular supermarkets are starting to boast of some "Organic" vegetables. And they are willing to pay a premium to the producers who grow them.

Don't be afraid to ask other vendors questions. Become friends with them. Ask for their advice. Help them out if you can. There will come a time that it will pay off!

My first day ever, all I had (early in the season) were bundles of 6 to 8 green onions and small sacks of "Baby Potatoes" . I weighed them out at home but sold them by the bag - not by weight. . I did not have to deal with scale issues. Scales used to sell produce by the pound must be inspected and certified by the state.

That's about it for now folks. If you have any other questions, I will try to help. Just e-mail me. Last year was my first time ever to sell my garden produce at the Farmers Market here. I still have a lot to learn for sure. That's why your experience and even your questions will help me to develope this bulletin.

I would also like to hear of your experinces and the experience of other customers or vendors at Your Farmers Market.

And a last tip you might consider on selling your produce:
Try calling your local grocery store or restaurants to see if they would like to buy your fresh produce.  Try to work out a deal that works for both of you.

Don't undersell in your eagerness. Sell Freshness, Quick Deliverability,  Reasonable prices for a Superior Product.

If you want to sell to a grocery store,  Ask for the "Produce Manager".

If you want to sell to fancy restaurants, ask for the Chef. He usually makes most of the produce buying decisions for his kitchen. You must meet his standards. He will pay a premium price for quality and 24 hour order time.  Or even more for immediate delivery when he is in a pinch. Practice. Call a few up and ask them what they really need in the way of service or quality produce. If you have nothing to sell, be open. Tell them you are doing research on a new produce business. He may be your first customer in the future!

Don't bother with long winded explainations to anyone else why you are calling if they are not part of the buying process for the store or restaurant. If your not sure who to speak to, ask to speak to the manager or owner. This is the professional approach. Don't sound nervous and don't be a phony. If you only have a 30 X 50 ft garden, tell them the truth if they ask. Never misrepresent yourself.

Buy or print out at least a few simple but nice Business Cards. They are Very important to being taken seriously. Especially by the business world. Don't be cheap and figure that you can get them later. Business Cards buy respect from everybody. It shows you care enough for your business to have business cards. You'll be way ahead of the other guys who are trying to save pennies - and loosing out on the big bucks.

Hope this little article has been of help.


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