Eat This, Ministry of Controversy

Farmers Markets and the Etsy Problem

Apparently, in some parts of the country, farmers markets have expanded so much that they've run out of customers to sell to, and they're finding it hard to command the premium price they'd grown accustomed to. This poses a problem for those of us who would like to see much more of the nation's food grown on small, local farms.

Now, any economist (really, any economist, not just a conservative, farmers-market-hating economist) would start smirking right about now and point out that the solution farmers might come to eventually is the very one they stand against:  become more efficient, thereby squeezing out profits even if prices have to come down.  If they could figure out a way to accept a lower price, they could expand their market and sell more to restaurants, grocery stores, or local makers of salsa and the like–and then we would all be eating more fresh, locally-grown produce because it would be everywhere:  at our local grocery store, on our sandwich at the deli, in the salsa at the Mexican restaurant.

So how would farmers become more efficient?  Well, (a group of local farmers sitting around a table might decide) what if we each specialize a bit more?  No need for each of us to invest in a hoophouse to grow winter greens.  Harry's got more hoophouses than he knows what to do with.  Let's let him grow the greens.  And Sally has the only decent climate for growing tomatoes in the whole county.  What if…

You can see where this is going.  Monocultures! Automation! Gah!

Or–what if that same group of growers sits around the table and says, You know, the problem is that we each have to do so many different things in the course of a single week.  We have to start new flats of seeds, and transplant, and cultivate and water and harvest, and sort into boxes and make cute signs and load trucks and drive to markets and create lovely displays and bag and weigh and count change and smile and make friends, and do accounting and pay bills and repair fences, and it's all so lovely, but it seems like we never have enough time to really do any one thing well.  And some of us really suck at some of that stuff.

So what if we split that up?  What if one of us starts all the seeds?  What if we all pitch in on one big truck that drives around and picks everything up and takes it to market?  What if somebody else stands there around the town square on Saturday morning and sells the strawberries so we can be back here at the farm, doing what needs doing?

You can see where that's going, too.  Divisions of labor!  Manufacturers, distributors, wholesalers, retailers! An industrialized food system!  Nooooooo!

I don't have the answer.  Farmers markets, and small local growers, are wonderful in every possible way and I love them.  But if small, market farmers can only get by on the "Etsy price" for their food, doesn't that impose some natural limitations?  And if getting more efficient requires making unacceptable tradeoffs (such as monoculture)–where does that leave those of us who want to see an ever-expanding share of the nation's food come from small and wonderful farmers?

Discuss.

Posted by on August 31, 2011 at 4:30 am, in the category Eat This, Ministry of Controversy.
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31 Responses to “Farmers Markets and the Etsy Problem”

  1. Ray Eckhart says:

    When I read the article, my reaction was exactly as yours. I sent it on to colleagues with the question: “Are we rediscovering the benefits of wholesale distribution systems?” It’s an issue that will have to sort itself out, since competitive pressure and market forces will make it. I think the best way to keep the quality of the local farmers markets is to admit they are a niche market, not a replacement for conventionally grown food, and enjoy them for that. It’s disappointingly limiting, of course, but to use an overused adjective, sustainable.

  2. Chellie says:

    Could the monocultures rotate crops amongst themselves, suppose Sally only grew tomatoes, and Tom cukes, George mellons this year. But next year they all switch. Of course maybe the tomatoes are the cash crop and good ‘ol George doesn’t want go wait his turn. What to do then? Oh no! Communism!!! Socialism?! Ack!

  3. naomi says:

    I’ve got a friend who is a provider for a CSA in Athens, Georgia. They’ve set up a system online with a form to fill out weekly. She puts in what she has available and how much and the clients put in their orders. She brings her produce before a particular time on a set day at a drop-off point. She gets paid without waiting and the customers can pick up the goods any time that day. I suppose it could get crazy in larger markets, but she’s much happier than when she had to set up a booth and wait and wonder while also wanting to get back to work.

  4. A_P_B says:

    Exactly. Small farmers can’t overcome the economies of scale enjoyed by their larger competitors, and thus they’ll remain dependent on the subset of consumers with enough money to support them.

  5. JDElia says:

    This is an issue. I ran a retail store and often had the same conversations with artists. An in regards to Farmer’s markets – many of my friends are struggling to make ends meet and have opted to buy organic produce at the big chain grocery stores vs the farmer’s markets… because they just can not afford it. We’ve seen an explosion of farmers markets here – but pricing is an issue for many. We want to support our farmers, but we need to affordably feed our families too.

  6. There is always the option of them finding new markets. There are still plenty of places in the country where there isn’t a glut in farmers markets or where the farmers markets have more craft fair items than produce. Instead of their halcyon locations in upstate New York or the PNW, they could move somewhere like the south or interior parts of the west. Growing in these places is harder, but the demand is there. There is also the option of removing government farm subsidies to level the playing field, but the lobby there is too powerful.

  7. Yes, what Susan in the Pink Hat says. We do not have a glut of farmers markets in Colorado and it’s time to start limiting the farm subsidies to multi-national corporation monoculture farming (which is not sustainable).

  8. rainymountain says:

    Maybe what Farmers Market growers and artists/craftspeople are charging is a real reflection of the cost of sustainable production. Without government subsidies; without low paid, badly treated migrant labour or food imported from overseas again dependent on cheap labour and unregulated environmental controls, the cost of food production will rise. I choose Farmer’s Market food (even on a low income) because I am assured that I am eating locally, that employees are paid a reasonable wage, that land is being nourished and that controls put in place to ensure the well-being of the buyer, the product and the producer are met. I would rather eat less to be able to afford food that reasonably reflects the costs of local production.

  9. I really want to support local farmers. I really do. I wish I could afford to buy all my produce, eggs, milk and meat from them. But with a family of six decisions have to be made. I’ll buy tomatoes from the farmer’s market, but I can’t justify paying $2.59/lb for local peaches when the ones in the store are 99 cents/lb.

  10. Thad says:

    Middle ground my dear, we need more middle ground …

    The best solution that I heard to this situation has to the local food hub – essentially a non-profit or cooperative organization that does is a resource for both farmer and consumer. The USDA has started to promote food hubs as a way for local and regional food to reach consumers more efficiently than the current system of farmer markets and CSAs. Here in NoVa, we just had a new-ish one open called Arcadia -http://arcadiafood.org/ – that is not just a food hub but also an educational farm and mobile market.

    Food hubs solve many of the problems outlined because they are run by people that understand the wholesale market (Arcadia was founded by the owner of the Neighborhood Restaurant Group, which consists of about a dozen restaurants in NoVa and DC) while also providing a great source of local food to the average consumer.

    Cheers!

  11. anne says:

    I agree with rainymountain; it’s expensive to grow food these days, especially in a responsible manner. Americans have become used to spending far less of their income on food than people in other countries, and thanks to industrial large-scale farming and subsidies, they don’t have to. Food safety and other regulatory requirements have been increasing steadily in recent years, adding other layers of expense to farming; the big guys can afford to hire people just to keep them in compliance, but small guys have to do it themselves.

    Co-ops might be a way to go, but in my experience, there are always problems with that (not the least of which is the independent nature of many small farmers).

  12. Matt says:

    It seems like the solution is to get smaller, not bigger. If certain markets are getting too big, then why not divide them like a overgrown oregano? :)

  13. Elsa says:

    This is a great post, and it got me thinking about both of your points. I am a frequent shopper at several farmers markets, and a seller on Etsy. I would like to think that in addition to being sure you’re not over-servicing an area with farmers markets, you would also try to increase the number of customers. The farmers are already busy, so it would be nice if the organizers would do more to promote. There are still many people who just hit the grocery store rather than take the time to go to the market. (I have no idea how to do this, but I’m heartened to see the numbers of young people and new parents that are frequenting the markets these days)
    As for the Etsy issue, it’s a shame it didn’t work out. More sales should mean that you could work out cheaper costs for materials, and the lack of Etsy and Paypal fees should make it easier to lower your prices. (That’s almost 10% right there!)

  14. Earth Girl says:

    In reference to an earlier comment, there is a glut of farmers markets in the flyover states also. Our Indiana town of 250,000 has one or two FMs every day except Sunday and that does not include the numerous farm stands and CSAs. Every county around us has a market in the square on Saturday plus a LOT of people grow their own produce.

    I sense that the markets will shakeout before the producers do. Some markets have already closed. The reputable markets, those that ensure local or organic production and keep out the cheap crafts, seem to be thriving. They also charge the farmer a premium for a booth.

  15. Felicia says:

    This strikes home on so many different levels. I am a gardener who buys her vegetables at the farmer’s market. I grow flowers not to sell but to admire in my yard and only very occasionally do I grow vegetables. I have sold my plush creatures on Etsy for four and a half years and for one of those years I set up a weekly booth at my local farmer’s market.

    Setting up a craft booth every week for an entire season at my local weekly farmer’s market was an eye opening experience. What I discovered was that most shoppers were there to buy produce and while they browsed the craft booths, they rarely made purchases from them. Some shoppers thought it was a flea market and wanted to haggle over price. Most shoppers were under the spell of the super cheap Wal-Mart products and refused to pay the asking price for a handmade item. My best selling day was the day the market opened for the season and sales fluctuated from zero to not much there after. I decided to stick it out anyway with the idea of counting my profit from the total season’s sales and combining those numbers with my product sales through other venues, one of which is my Etsy shop.

    What you say about Etsy shop owners is true. Rarely are they adept enough at business to have established a living wage for their wares and are prepared to work with retailers to provide wholesale goods. This is due to the ease at which Etsy allows shops to be created as well as the nonexistent over-site. The majority of shops are not run by experienced business folks but rather by hobbiests who want to sell their stuff for a bit of money. Often they price their goods below a living wage because they are not earning an income from their shop sales. They simply want the high of selling something they made. Not all shops are this way, of course, but many are.

    The sales that I gleaned from my weekly farmer’s market booth were negligible. No one wanted to pay the prices for my plush that I have in my Etsy shop. In the entire season the only items I sold were the cheapest possible products and ones that were marked down because they were of second quality. It seems that handmade products and farmer’s markets really don’t go together. They both have different products with very different end uses. Food is a need while, generally speaking, crafts are a want. The craft vendors I was selling along side all agreed that sales were pretty terrible. But the produce vendors were doing well and had steady sales. After all, food is a renewable purchase. Crafts are not. While you may need to eat every week you will not necessarily need a new plush toy to give to your boyfriend for his birthday.

    Each week I was at the market it seemed that the customers rarely varied and hardly grew in size. There was a small cohort of supporters that would turn up, make their produce purchases and scamper off. There were only occasional new shoppers from some other local event taking place downtown or the infrequent drive-by. Despite all promotional efforts by the end of the season the market seemed to be the same relatively small size and not much changed in the years that followed.

    I agree with other commenters that the answer is a mixed bag with increased promotion as one of the most important factors. You could be growing and selling the absolutely most delicious stuff on this entire planet but if no one knows you’re selling it then it might as well not exist. So you must get the word out about the farmer’s market and you must do it constantly, loudly, and through a myriad of avenues and people. It’s the only way to get bodies to the market which means an increase in sales.

    Perhaps all the farmers selling at the market could combine their efforts and hire a PR firm that would promote the sin out of their market. Getting your message out in a noisy world is tough but absolutely necessary. Essentially, market promotion has to be a huge part of the equation and done properly could increase market visitors and sales. But a well rounded and thorough ongoing marketing plan isn’t something every small farmer has the time or skills to invest in. Hiring a professional to develop and implement the plan would probably be the way to go. Return on this invest could be fantastic.

  16. Julie Hollingsworth Hogg says:

    Food and its meaning to us basically has two dimensions. We 1) eat it to live and 2) we eat for pleasure. At all times we eat it to live, whether pleasurable (tastes good) or not. And we eat for pleasure as much as we can – which takes sourcing special ingredients and often takes discretionary income. The local markets will in time settle out to service these most basic needs. As we know, there is not enough food security in industrial ag and it’s reliance upon trucking, shipping, etc. We must have local agriculture for the sake of food security – to feed us to live. But we also would like to have food that is pleasurable to us, even if more expensive. These are two different markets although they can combine logistically if they so choose. It is important not to get too romantic about eating food, albeit local, organic food, in order to live. But being romantic about what tastes great, costs a little more, is rare or hard to grow….that’s half the point! It’s the experience! And that’s gonna cost you.

  17. UrsulaV says:

    *cough* While I think the comparison has it’s moments, artist that I am–it doesn’t cost anything like $10 to sell on Etsy. Overhead and fees and even nebulous things like “storage” don’t add up remotely close to that.

    The problem is the artist’s labor.

    These aren’t people trying to get $20 on an item that cost $10 to make, these are often people trying to get $20 on an item that takes $10 and four hours to make. They can’t give you a wholesale price because they would essentially be working for nothing. The profit margins for handmade crafts are frequently razor thin and involve the crafter making a lot less than minimum wage already.

    This is why when you’re at an art fair or a dealer’s room, saying “Your stuff is too expensive” gets you set teeth and a grim “I’m sorry you feel that way…” and a heartfelt wish on the part of the artist that you go somewhere very unpleasant in the company of rabid warthogs.

  18. Amy Stewart says:

    Ursula–when I said “overhead,” I meant that to include time. In theory, the retail price on something–anything–is double the wholesale price. So–again, in theory–a twenty dollar item on Etsy should represent ten dollars for the cost of making the item, including time, and ten dollars for the cost of selling it, including time.

    Same for farmers. If you’re selling produce for five dollars a pound at the farmers market, then in theory that’s $2.50 for the time, materials, etc to grow it and pick it, and another $2.50 for the time, materials, etc. to sell it at market.

    So–again, in theory–it should be possible for farmers to wholesale their stuff to restaurants, stores, etc. for half the farmers market price. Just like an Etsy seller should be able to wholesale their stuff to a gift shop for half the Etsy price.

    But that doesn’t always happen, for all the reasons I mention, which is what I called the “Etsy problem.”

  19. Ray Eckhart says:

    Just a note to correct some of the misunderstanding of posters in regards to farm subsidies. 90% of USDA farm subsidies go to just 5 crops: wheat, corn, soybeans, rice, and cotton, all of which are commodities. Corn in this case is production corn which goes to producers making ethanol, high fructose corn syrup, animal forage, etc., not sweet corn that people consume. Then add in dairy and sugar beets,and the total is reduced further. Until the 2008 farm bill, none of the subsidies went to “specialty crops” or fresh market vegetables, whether produced conventionally on large farms in California, or small, local family farms, conventionally, or organically grown.

    Some links:

    http://farm.ewg.org/pdf/california-farm.pdf

    http://www.cato.org/pubs/handbook/hb111/hb111-18.pdf

  20. CSAs are pretty amazing – my tenant pays approximately $14 per week for vegetables, fruit and meat. Yes, they pay up front, but it’s a huge, huge savings on her grocery bills. The farm’s start-up costs are covered for that year from CSA customers.

    I’m half-tempted to say that Etsy artists that can’t figure out their wholesale costs and just can’t swing that, there’s something they’re doing wrong. There must be. I dunno.

  21. Margit VanSchaick says:

    When you consider that parents would like to feed their children organic, locally- grown veggies, but the reality is so many are having a hard time making ends meet, 6 radishes@ $2.50(25 cents each) seems obscene to me. That’s the price at the local organic farm. The answer, it seems to me, for such folks, is to learn how to grow your own salad crops in a small, efficient fertile garden. I grow huge amounts of chard, kale, lettuces and herbs in a couple 4×8 elevated garden beds: rabbits can’t get at it and it’s so easy to maintain, with lettuces sown every week and resulting production of beautiful, healthy veggies. Just step outside your kitchen door and pick a bountiful salad for pennies! I’m afraid farmer markets and organic farms are elitist and “precious” all too often. We need some fresh perspectives.

  22. greg draiss says:

    Then lets take it the other way. I can grow tomatoes in my back yard and sell them for much less than the supermarkets. So if I can do it and the farmer can’t then we have to grow it ourselves or buy it at the supermarket. I find it hard to beleive that a local farm product (peaches) needs to be priced at $5.00 at a farmers market and the supermarket sells local peaches for $1.49. A true market based system would be neighborhoods teaming together with each growing a certain crop collecting early Friday morning and selling at a local market.

    The “fresh food” movement is full of crap when they say good food “just has to cost more” BULL$hit

    The TROLL

  23. UrsulaV says:

    Sadly, Amy, that’s just not how it works out in crafting. Most of the time it’s a lot more like $18 for parts and labor and $2 in profit. They’re already selling at the very thin edge, probably for the same reason farmers are–because they love what they do, and they want to get paid enough to keep doing it…but they also need to keep the price low enough that people will actually buy it. (Our culture, though getting better, is not terribly supportive of the higher price of handmade goods.) I’m sure there are Etsy sellers who do make a more than 50% profit and could afford to wholesale, but for the vast majority, such a thought is laughable.

    Subsistence level art, at its finest!

  24. Nora Graf says:

    I’m an Etsy seller who would sell wholesale, but it isn’t just a matter of money. It takes time to make hand-made items. If I had an order for 10 items, it’s a huge commitment. Literally it would take several weeks, depending on the complexity of the item, to complete the order. While I was making those, both my Etsy shop and my craft show sales would suffer from a lack of new items. It is tough to figure out the balance of retail vs. wholesale. Yes it would be great to sell ten items, but while I’m making those I could be loosing retail sales. Making handcrafted items isn’t like growing a tomato plant. I get a steady supply of tomatoes from a few plants that I paid a few dollars for and spend a minimum amount of time on. It would be nice if I could make items as fast as my tomato plant produces fruit. I am not saying farming is easy, I know it isn’t. It’s that handcrafting items is just a bit different than farming. I also want to echo others comments on the cost of farmers markets. I can no longer afford to go to my local market. At double or triple the cost of a grocery store the market is now too expensive to buy at. I know the produce taste better but my budget doesn’t include $4+ tomatoes.

  25. anne says:

    The comparison of crafts vs. produce is not a good one. Because produce is seasonal and has a limited shelf life, a farmer has a narrow window to harvest and sell her crop. Add to that the likelihood that due to seasonality, at the market, there are probably multiple vendors selling the same fruit or vegetable, and a limited market share, and some of that produce is going to not get sold there and may be throwaways if another market can’t quickly be found. Also, some market vendors farm for their primary income, others not; this can have profound changes on pricing; the vendor down the row may drop her prices to sell out,not really needing the income like her neighbor down the row. Hard to compete with that.

    Contrast that with the crafter, who may find sales slow at the market one day, but can take her product home to sell on-line or at another market in the future. She can make her product year-round (unlike most farmers), wait for sales on the materials she uses to cut costs, take time to explore new markets–even ones at a long distance away. Other crafters may make a similar item, but none will be exactly the same, whereas a person in the market for tomatoes will factor price as well as unique variety.

    I work with a glassblower, selling his items in my tasting room, and we worked out a deal where I buy some items at wholesale, and others I sell on commission of 30%. This works pretty well for both of us–some of the stuff sells faster than others, and some of it he can make faster too.

  26. mj says:

    The analogy of growing tomatoes in ones’ backyard for cheaper than the grocery store does’nt equate to a farmer making a living with that same wage. Sure, you can wash your car for cheaper than the car wash, but why dont you quit your regular job with benefits and do it for a living?

  27. Margit VanSchaick says:

    Greg Draiss exactly expresses my feeling about the price of food at farmers’ markets and farms: let’s try to come up with workable solutions to this problem. Those of us who have a passionate interest in this, essentially the question of food security (for good, nutritious pesticide-free food), can work together to come up with innovative answers. I wonder if part of the problem is that most farmers practice seasonal farming and try to earn a year’s living in a few short months. Maybe a re-read of Eliot Coleman’s work is in order. I’m convinced that we can find better answers to our current unaffordable, elitist source of wholesome food. The price we’re paying as a nation is unacceptable: so much ADHD and other results of poor nutrition.

  28. Margit VanSchaick says:

    Interesting, how many crafters responded to your post and how few, if any , organic farmers/growers! I would love to see this conversation develop further, maybe generating some new, workable ideas. Thanks, Amy, for addressing these issues–would it be possible to conduct a forum focusing on the question of affordable, good food? With probable continued hard economic times ahead, what are some “best practices” to feed ourselves and our communities?

  29. commonweeder says:

    We are fortunate in our region that small farmers can work with CISA (Community Involved in Sustainable Agriculture – and you can check their website for full info) because they get business and farming advice and various kinds of support like selling to institutions like the local schools and colleges, hospitals and restaurants. We have a big buy and eat local sense around here.

  30. Peter Hoh says:

    Went to the market this morning. It’s a satellite market for the St. Paul Farmers’ Market — held in a suburban church parking lot. The big market just off downtown is a weekend deal.

    On my list: cheese, apples, and then whatever veggies looked good. There’s only one cheese seller. Two farmers were selling apples. Someone was selling bread. There’s one guy who sells eggs, but he usually runs out before I get there.

    The other 20 or so vendors had pretty much the same mix of beans, tomatoes, carrots, cucumbers, and other garden vegetables.

    Of course I would prefer it if some of the vendors just set up their tents and tables in the church parking lot a couple blocks from my home. And it would be awfully nice if the apple guy were among them, but I don’t think this is realistic.

    My guess is that the farmers get more customers being clustered than if they spread out around town.

    Growing up, my small town (12,000 people) had a small store that specialized in selling produce, much of which was local during the growing season. Mr. Thomas would drive his truck out to the farms in the early morning and pick up the produce he’d sell that day.

  31. Peter Hoh says:

    It would be interesting to know what people paid for farmers market produce in different areas. But it’s not enough to say that I paid $2 for a bunch of beets, is it? You’ll want to know how many were in the bunch, and what size were they. Sounds like too much work.

    Maybe next week I’ll take some photos at the market and post them on flickr.

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