Our market is considering owning our own building so that the market has a permanent home.
Is this a good idea?
Curious Market Organizer
Dear Curious Market Organizer,
Generally speaking, farmers’ markets are not huge money generating operations. The average farmers’ market makes enough money to pay the rent, the expenses and maybe has a little left over to pay an honorarium to the market manager.
Many farmers’ markets dream of owning their own venue so that they aren’t at the whim of their landlords and don’t get shuffled around if something else is happening on Market Day. But ownership has its responsibilities, not least to the bank.
As a quick back of an envelope calculation, if it costs $1.7Million to build a small purpose built structure for about 30 vendors, and those vendors pay $35/week in rent for a year, that generates $54,600. So it will take 31 years to pay for the market assuming that you have no expenses (heating, lighting, cleaning costs, insurance etc), you don’t pay taxes or interest charges and you have no staff…
Of course you may be able to convince the province or ACOA to chip in 50%, but that’s still a huge debt to carry on your shoulders for the sake of a bit of stability.
The only way to make an ownership situation work is to have alternative revenue streams such as events rentals, weddings, parties, conferences etc. In fact, this may well end up being where most of your revenue comes from. So stop and think for a second, do you want to have a farmers market or an events facility?
In most cases farmers just want to be farmers and farmers’ markets just want to be farmers’ markets. In which case it makes more sense to work with your local municipality, a tourist venue, arena, hospital or community organization to come to a mutually beneficial relationship based on the farmers’ market either providing a service (great quality local food) that benefits the community as a whole, or attracting customers who then spend money at other local retail outlets.
Whatever you decide, whether to build, renovate, buy or lease, take the time to think through what your farmers’ market represents and what you want to spend your time doing. You can have a wonderfully successful farmers’ market in a school yard or a parking lot (although I know that the weather does not always co-operate) and spend any revenues generated on your manager.
A farmers’ market is more than a building, it is the people who sell there!