Bill P wrote:John Hagan wrote:There is a unwritten, or in the case of many markets a written rule about pricing. Nobody wants to be undercut and most vendors agree on a set price or a range of pricing that is fair to all involved.
John,
This sentence caught my attention.
I wasn't aware that the farm markets were price setters. In a pure (economic) market sense, that seems to be not totally in the interests of the consumer. Being undercut(sellers) or out bid (buyers) are the hallmarks of a competitive marketplace. Personally, not a big deal that I'm going to get all twisted about, but nonetheless interesting.
FWIW, I grow much of my own produce and buy my meat from local producers who don't utilize urban farm markets.
Cheers,
'Winger
First, hats off to you for taking the effort to buy local meat and growing your own produce. I really wish more folks could/would do that.
Bill, Just to be clear..not all farmers market set prices. Heres a link from the state Ag site that you can follow to see the rules for most of the markets in the state.
http://www.kyagr.com/marketing/farmmarket/directory.htm As to your comment it seems to be not totally in the interest of the consumer..let me copy here from the state on the issue.
http://www.kyagr.com/marketing/farmmarket/index.htm● Pricing
Setting market prices is a difficult area. Customers do not like to know that the market is involved in “price fixing” but, at the same time, markets need to protect their vendors from vendors who dump low-cost product on their market. Sometimes these vendors are hobbyists who are not trying to make a profit or might be someone who has overbought or over-produced a product and wants to sell it quickly.
Some markets set a minimum price for a product and allow any higher prices that the vendor may want to charge. Organics, heirloom varieties, specialty crops, and others may bring higher prices. Farmers’ market prices are reported as well as prices from the produce auctions around the state to the University of Kentucky’s New Crops Opportunity Center. You can find a link to these prices by visiting the farmers’ market page at
www.kyagr.com.
Also this from UK on pricing
Pricing Against Competition
Many farmers markets discourage vendors from
purposefully undercutting each other on prices.
This is especially relevant to markets that may
allow reselling, where a vendor might be able to
buy bulk wholesale produce at a cost lower than
that produce can be grown locally.
Farmers markets are still the marketplace where
buyers and sellers can freely arrive at market
prices. Again, the best strategy for pricing
against your competition is to know your cost
of production. Differentiating your product from
your competition can help address this problem.
Furthermore, the reputation you develop for
offering quality packaging, presentation and
high-quality products will allow you to maintain
a higher price
Loss leaders are products that are purposefully
priced below their cost of production or purchase
value. You might choose to offer certain products
as loss leaders to your customers if those products
attract customers to your stand and cause them to
also purchase other, higher-profit items from you.
http://www.uky.edu/Ag/NewCrops/marketing/farmmarket.pdf Id like to share a story concerning the 7 day a week market we were part of for a time. In the second year we had a vendor who was raising determinate tomatoes(they come on all at once) and ended up being buried in fruit. His plan was to bring them to the market and sell them for .25 a pound. Granted they were not the best tomatoes I have ever seen,but at that price they were out selling all the other vendors who had priced at 2.00 to 2.50. In the course of three weeks all the other tomatoes vendors had taken their product elsewhere to sell. After this guy ran out of tomatoes the market was void of tomatoes and ended having to get them through the produce terminal. Customers who wanted local were steamed,customers who wanted to use WIC or SNP could not due to the fact they were not a local product. The market suffered big time.Definitely was not in the best interest of consumer.Its a fairly common issue to have "backyarder" come into the market place and dump whatever they have too much of. Its not as prevalent in the urban markets.Bardstown rd,and St Matts that enforce rules and have long waiting lists for vendors. In the country/rural markets that let anybody in,its a constant problem.
I have been selling at farm markets in Kentucky for ten years, and prior to that been involved in other states. Every market handles pricing differently. Most often though it goes like this....when a new crop starts showing up at market, vendors walk around before the market opens and talk to each other and discuss a price. Its pretty informal and generally works without any enforcement. In the long run its in the vendors best interest to keep a competitive price. When growing an Ag product you can never be sure when and how much of a certain product you are going to have. One week you could be the "screwer" and the next end up getting "screwed". This goes a long way to keeping vendors in the market. Not many folks like to go to a market that only has one or two vendors.
The tall one wants white toast, dry, with nothin' on it.
And the short one wants four whole fried chickens, and a Coke.
