I wanted to take the opportunity to share an interesting article concerning a study done on farmers markets in central NC. The growing trend of consumers to demand higher quality food is driving demand but there are some disturbing facts that come to light in this report. Take few moments and read the report.
FARMERS’ MARKETS IN CENTRAL NORTH CAROLINA:
Who’s Buying and Who’s Selling?
Mitch Renkow, Professor and Extension Specialist
Nicholas Georgiade, Graduate Research Assistant
The past several years have seen a marked
increase in the importance of farmers’ markets
as places for consumers to purchase locallygrown
food products and as venues for farmers
to sell fruits, vegetables, meat, and poultry.
Nationally, the number of farmers’ markets
increased by over 16% in the last year alone,
according to recent USDA figures. Among
states, North Carolina currently ranks 10th in the
nation with 217 farmers’ markets in operation.
Some have argued that farmers’ markets —
and more generally, local food systems —
represent a potentially important means of
stimulating local economies by re-invigorating
the local agricultural sector. Others contend
that due to a variety of factors – increased
nutritional awareness, food safety concerns,
and interest in supporting local farmers, to
name a few — the popularity of farmers’
markets among consumers will continue to
grow into the foreseeable future. Gauging the
validity of these contentions requires knowledge
of the motivation of participants in farmers’
markets. This issue of the NC State Economist
reports on-going research aimed at
understanding why farmers in central North
Carolina choose to sell produce at farmers’
markets, and why shoppers choose to purchase
produce at farmers’ markets.
Who Sells at Farmers’ Markets?
Between July and September of 2009 we
conducted a survey of vendors at seven
farmers’ markets in and around the Research
Triangle — Carrboro, Durham, Raleigh,
Burlington, Western Wake (Apex), Hillsborough,
and Cary. All of these farmers’ markets require
vendors’ farms to be located within 75 miles.
A total of 76 vendors were interviewed to learn
November / December 2011
about their farm characteristics as well as
marketing and production choices that they
made. Given the relatively close proximity of
the various markets to one another, some
farmers had a presence at two or more markets
in a given week; such “multi-venue” vendors
were only interviewed once.
Vendors tend to be small farmers. As shown
in Figure 1, more than half of the vendors we
interviewed farmed less than five acres. On the
other end of the spectrum, 6 out of 76 vendors
farmed over 100 acres; all of these were beef
and pork producers. Vendors tended to hire
few people to assist at farmers’ markets, with
more than 80% employing two or less workers.
In terms of product mix, most vendors — more
than 85% — sell vegetables, either exclusively
or in combination with other products. Smaller
numbers of farmers sell fruit and animal
products. Vendors of animal products tend to
be more likely to only sell animal products,
whereas vendors who sold fruit also tended to
sell vegetables. Interestingly, the vast majority
of vendors (73 out of 76) indicated that they
sell all of their produce locally; and of the few
farmers that did sell to non-local customers,
their non-local business in no case exceeded
10% of total sales. More than half of vendors
interviewed indicated that they sell over 90%
of their output at farmers’ markets, while an
additional 20% indicated that they sell between
50% and 90% of their output at farmers’
markets. Taken as a whole, these findings
suggest that farmers who participate in farmers’
markets overwhelmingly gear their production
activities to the local market.
In sum, the vendor survey results suggest that
sellers at farmers’ markets overwhelmingly
tend to be small-scale, predominantly vegetable
growers who employ relatively few individuals
for the marketing of their produce, and who
orient their production activities toward serving
local customers. Note that this characterization
of producers who participate in farmers’
markets accords with evidence that has been
developed by researchers in other parts of
the country (Martinez, et al. 2010).
Who Buys at Farmers’ Markets?
Throughout the peak seasons of 2009 and
2010 we surveyed 329 shoppers at four of the
busiest farmers’ markets in the Research
Triangle — Carrboro, Durham, Raleigh, and
Western Wake. Shoppers were intercepted at
market entrances and asked a series of
questions to elicit information on who buys
produce at farmers’ markets and what their
motivations are.
Table 1 presents selected results from the
survey. Shoppers at the surveyed farmers’
markets were overwhelmingly Caucasian,
mainly female, lived or worked relatively close
to the venue at which they were shopping, and
tended to visit the farmers’ market about once
a week. A strikingly large fraction of all produce
purchased by respondents — nearly 30% —
was procured at farmers’ markets, an indication
of a strong commitment to consumption of
local foods.
In order to assess the factors that most
influenced consumers’ decisions to shop at
farmers’ markets, respondents were asked to
rank on a scale of 1–5 the importance of a
variety of attributes of the foods that they
routinely purchase. The responses we received
suggest that food quality characteristics —
including freshness, flavor, nutritiousness, and
food safety — are regarded as the most
important attributes to shoppers at farmers’
markets. Also emerging as important to the
farmers’ market shoppers we surveyed was that
the food they purchased was produced locally.
Interestingly, the survey results suggest that
this latter characteristic was deemed somewhat
more important, on average, than actually
connecting with the grower of the product being
purchased (“direct connection to food source”).
On the other side of the spectrum, price and
brand loyalty appear to be somewhat less
important to shoppers in terms of what drives
their purchasing behavior. More than half of
3
November / December 2011
those surveyed indicated that they regard
prices to be higher at farmers’ markets than at
retail outlets, whereas only about one in eight
indicated that they regard prices at farmers’
markets to generally be lower than at retail
outlets. This suggests that consumers at
farmers’ markets are willing to pay a premium
for foods that they acquire at those venues
because of perceived higher quality (broadly
defined) of locally grown food products —
again, a finding that echoes research
conducted in other parts of the country.
Also interesting is the fact that while the great
majority of shoppers expressed an opinion that
prices are higher at farmers’ markets, we
observed that prices at nearby grocery stores
are in many cases – particularly at peak harvest
times — above those of comparable items at
the farmers’ markets. (Note, however, that
observed meat and egg prices were with very
few exceptions substantially higher at farmers’
markets than at nearby retail outlets).
Implications
The proliferation of farmers’ markets in North
Carolina (and nationwide) has drawn significant
attention in recent years. On the basis of
research that has been conducted around the
country, it appears that this trend has been
driven by growing consumer demand – and
willingness to pay a premium — for the
perceived superior quality of locally produced
foods. Our survey results are right in line with
this general assessment. Moreover, our
research on participating farmers suggests that
the increased demand for locally produced food
is being met primarily by small farmers
specializing in serving local farmers’ markets —
a finding that is also in line with the findings of
research conducted elsewhere.
Taken together, these observations imply that
the growing importance of farmers’ markets is
a demand-led phenomenon, one that is in
many respects reminiscent of trends in food
demand underpinning the dramatic increase in
popularity of “high-end” food retailers like Whole
Foods. However, it is important to bear in mind
while the share of agricultural products sold
directly from farmers to consumers has grown
substantially in recent year, this share is still
quite small – recent estimates put it at between
0.4 and 0.8 percent nationally (Martinez, et al.
2010). And in urbanized areas like the
Research Triangle (where our surveys were
conducted), the dominant role of specialized,
small producers in meeting consumer demands
for local foods appears to represent a
significant factor limiting future increases in the
share of total food consumption met by localvember / December 2011
production. Finally, and in contrast, in sparsely
populated rural areas where both farm sizes
and output per farm are larger, it seems likely
that the much smaller numbers of potential local
consumers represents a more profound
constraint on the ultimate market share of
locally produced foods.
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Reference
Martinez, S., et al. 2010. Local Food Systems: Concepts,
Impacts, and Issues. Economic Research Report No. 97,
U.S. Department of Agriculture, Economic Research
Service, Washington, DC.
