Farmers Market Federation of New York. Estimating the Economic Impact of Farmers Markets March 4, 2011. Estimating the economic impact of a Market in the community is an inexact science at best. Vendors, by nature, are reluctant to release sales information.
Estimating the Economic Impact of Farmers Markets
March 4, 2011
Estimating the economic impact of a Market in the community is an inexact science at best.
Vendors, by nature, are reluctant to release sales information.
The total impact of the Market does not stop at the market gate but extends into the community in the form of increased traffic and sales at adjacent businesses, increase in property values and improvements in livability ratings.
Also the multiplier effect resulting from the dollars circulating in the local community must be considered.
In the fall of 2010 a group of students from the University of Rochester utilizing a tool developed by the University of Iowa, executed another study of the Market’s economic impact as well as the effectiveness of our marketing efforts and some of their suggestions for improvements.
What follows is the presentation that the students developed.
December 9, 2010
Local and Global Market Research Class
Department of Anthropology
University of Rochester
What we did:
To measure the impact of the RPM on the local economy:
We estimated spending and sales based on information obtained from customers and vendors during our interviews.
2. We multiplied the dollar amounts for customer spending and vendor sales by the number of customers and vendors using figures supplied by the RPM.
3. Following the model used in a study of Iowa farmers markets, we estimated the total effects of RPM activity on the local Rochester economy.
According to shoppers:
$393 average annual spending, or $7.75 per week.
$7.75 X 2,043,000 customer attendance =
Estimated Total Customer Spending
Problematic issue in calculating customer spending: the 2+ million figure for number of customers reflects attendance by day (Tuesday, Thursday, Saturday, special events), not separate individual shoppers. There may be some overlap.
Sales / Vendor
$52,000.00, $52,000.00, $130,000.00, $52,000.00, $250,000.00, $2,990.00, $28,000.00, $58,000.00, $39,000.00, $52,000.00, $250,000.00.
Number of Stall
Licenses / Month
Estimated Total Annual Vendor Sales
(The average was calculated by factoring in the 11 vendors that
did give sales information out of 13 vendors interviewed)
Average = ~240 X $87,817.27
Recap on RPM annual gross sales:
Customer spending = $15,833,250
Vendor sales = $21,076,080
Models of economic impact include not only direct effects (sales as estimated above) but also indirect and induced effects. This provides total effects on the local economy.
Indirect effects in the farming industry involve purchases of seed, fertilizer and other items that are part of producing crops.
Induced effects reflect spending from earnings (profit) by farmers and businesses from whom they buy the items for production.
Based on the Iowa study, a multiplier of 1.58 applied to the estimate of gross sales provides a measure for total effects.
Direct sales of $15,833,250
x 1.58 =
$25,016,535 total effects
of RPM on local economy.
Direct sales of $21,076,080
x 1.58 =
$33,300,206 total effects
of RPM on local economy.
Source of economic model and total effects multiplier: “Consumers, Vendors, and the Economic Importance of Iowa Farmers’ Markets: An Economic Impact Survey Analysis”, Daniel Otto, 2005. Article is available online (Google author’s name and article title). We spoke with Dr. Otto and he believes that the multiplier is a very reasonable tool for the Rochester metro area economy.
Iowa farmers markets
By: Caitlin Simpson, Elizabeth Riedman, Emma Rainwater, Miles Booth
Interviewed 48 people
Special Events of Rochester utilizing a tool developed by the University of Iowa, executed another study of the Market’s economic impact as well as the effectiveness of our marketing efforts and some of their suggestions for improvements.
Origin of product
Frequent Visits (except special events)
Of the people interviewed, the most highly valued experiences were as followed:
Diversity- Words to describe the market included ethnic, different, cultural, and eclectic
Support local farms
Community- Part of a greater whole
Interacting and getting together with friends and family
Atmosphere- Many said that "there is nothing else like the market in Rochester"
Walking encourages exercise
Upon evaluating the overlapping reasons for coming to the market, it it clear that for many customers, the market represents and facilitates the idea of community
While some people fall into both categories marketing specifically to either group will effectively encourage the people in both groups to come to the market. Further, we would like to point to the fact that the market is unique in the sense that it offers both low prices and a quality experience.
Vendors reluctant to take tokens
Facade of businesses
More organic food
Differentiate between farm grown and wholesale goods
By: Stephania Romaniuk, Eliza Friedman, Susanna Virgilio, Von Holguin
By: Emily Adams, Kristina Diaz and Kevin Zheng
Union Street Bakery
Juan and Maria’s Empanadas
The average estimated number of customers for all 3 stands on a Saturday is 400
Began importing olive oil from Italy and expanded to cheese, olives and other imported specialty items
Imports directly from Europe
By: Katherine Burnham, Edward Chi, Arielle Friedlander, Elizabeth Kim, Joshua Stillman, Scott Strenger
and Benjamin Witten
1. Are you aware of the Rochester Public Market?
2. How did you first hear about the Rochester Public Market?
3. Are you aware of the following special events that occur at the Market?
4. How useful do you think these special events are in attracting customers to the market?
5. In your opinion, what does the Rochester Public Market offer that other stores do not?
6. Where do you shop to purchase the following goods?
[RPM, Other Stores/Supermarkets, Other Farmers' Markets]
7. Demographic Information - Age, Gender, Zip Code
8. How did you hear about our survey?
"From my niece who is a student at U of R"
"I work for the Culver Medical Group (part of Highland Hospital and under the U of R. "umbrella") and found in my email."
"Work at URMC. I've shopped at the Market weekly for 30 years.”
"Isn't anyone interested in why I don't shop at the Public Market? I heard about the survey from @Rochester, the UR daily e-newsletter."
Responses: No; Yes, but have not attended; Yes, have attended
Ordered Least Attended Event to Most Attended
Harvest Jamboree Ex. 61.3% 30.0% 8.8%
Concerts & Night Market
Community Garage Sale
Flower Days 34.3% 31.0% 34.7%
Students were high percent of participants (not local);
Some events only occur once a year, while others happen frequently
Never heard of Market N/A: 27/4 - 42.4%
Not Useful: <4.1%
Somewhat Useful: 20.1- 32.1%
Very Useful: 29.1- 49.9%
- Categorization of responses
"The public market offers great prices on fresh locally grown products. I think it is beneficial because you get a lot for your dollar while supporting local Rochester Area businesses."
"The opportunity to buy local, and to shop in a real market atmosphere. It makes buying needed things more fun and interesting. And it's more personal, more in touch with the community, since you are interacting with the people who actually grow and produce the merchandise."
"Fresh fruit for cheaper, and the experience is always fun.Oh yea, the AMISH PEOPLE MAKE THE BEST BREAD EVER."
"The freshest produce. Makes 'Eat Local' an easy reality. A feel for how cosmopolitan our city is."
"Necessary items at bargain prices all at the same location. Also, the feeling of a more direct and ancient form of commerce. What I enjoy the most is purchasing directly from local farmers and feeling part of the community at large. Although I have heard that many vendors are distributors or other forms of middlemen (i.e. not necessarily farmers) and I think this may be misleading to many."
"Lively wonderful healthy mix of people from all the cultures and neighborhoods in Rochester. The ONLY place where this happens. local produce, in season foods, places to sit and watch the crowds, drink coffee, Italian cheese shop."
-Expand and Update
"Local Foods Week" at University of Rochester
-Contribute and advertise
Bike-Friendly (Could reduce parking problem possibly too)
Come to campus
-Leftover produce Tues/Thurs?
Reusable Bags and RPM Pins
Feature information in @Rochester and the Weekly Buzz
Ask vendors how they would prefer to be advertised
-Customers and vendors
Local Foods Week:
Dining Services, Campus Dish,
University Council on Environmental Sustainability
Bring Market to Campus:
Celia Palmer, Director of Conference & Events Office