Last week, I promised I’d get into the details of how the market sustains itself financially. Many of you have asked about that, and I’m happy to oblige.
First off, we’re legally a sole proprietorship, and the market is just an extension of my wife’s and my small farm. We file a Schedule F in addition to our regular tax forms. When the market started in 2002, it was named “Locally Grown Cooperative”, but it was never legally organized as a co-op. Dan & Kris Miller, the founders, were always sure to run things in a cooperative spirit, and when they handed the business to my wife and I in 2004, we’ve tried to do the same thing. I’ve since renamed it to “Athens Locally Grown”, but you’ll still hear a number of people refer to us as “the co-op”.
We’re not a non-profit, either, but we’ve structured things so that over time the market can cover its own expenses. Just like all of our member farms are sustainable growers, the market itself needs to be sustainable. So how does the market cover its expenses? One small way is through the memberships you pay. The $25 a year you give to the market is enough (to put it bluntly) to cover the costs of having you as a customer: banking fees from depositing your checks, paper and ink for printing invoices, web hosting fees, and that sort of thing. What’s left over goes to helping fund farm tours, food donations to like-minded area groups and events, etc. We currently have 541 paid members out of the 2295 accounts on the website.
By far the bulk of our funding comes from the growers themselves. They generally pay a 10% commission on their sales through the site. This money covers the many coolers we use, the tables and cots used to spread out and organize your orders, the truck we bought at the end of 2007, gasoline, the food allowance we offer our volunteers, etc. During the winter, the sales are not enough to cover our weekly costs, but in the summertime there is extra. If we plan things out well, it pretty much all evens out in the end.
Last year, the total sales and memberships combined through the market amounted to $360,980. This figure is astounding to me, and is an 18% growth over sales during 2008. About 90% went straight to our growers, and the rest went to a food allowance for our volunteers ($400 to $500 a week), coolers ($1000), tables & cots ($300), our farm tours (about $750 total), web hosting, and transportation. The “profit” gets counted as personal income on our tax forms, and came out to about $4500. I haven’t yet included milage allowances and other minor expenses, and that total will get a lot closer to zero when I do.
The growers get paid out of the shared cashbox when they drop off their sales, during the hour before we open the market. Then, you arrive and pay into the cashbox for your order. We then rush to the bank to deposit the money to cover the checks we just wrote to the growers. As explained elsewhere on the website, you are really ordering directly from and paying the growers yourself, but our shared cashbox system makes things convenient for you and them. (Imagine if you ordered from ten growers having to write ten checks when you picked up your items!) This shared cashbox system has so far satisfied the tax man, but it does mean that if you place an order and then never arrive to pick it up, we’re left holding the bag. For that reason, you are responsible for paying for orders not picked up, and that amount is automatically added on to your next order for your convenience. Last year, there was about $1350 of produce ordered but never picked up and so far never paid for at all (or paid for with bad checks). That might seem like a lot (and it is), but considering that the market’s sales total, that’s not so bad. In fact, it’s about a fifth of the US retail industry’s “shrinkage” rate. On the flip side, $3140 has been pre-paid into the cash box by people who pay online via credit card or who write large checks in person, and then draw down on that balance over time.
So, in probably far too much detail, that’s how we operate. Our market might be more expensive to run than a traditional “booths and tables” farmers market, but that price buys a system that’s simple, time-saving, flexible, and in my opinion, just better. There’s no money in the bank, but the market is paying for itself and that’s my primary financial goal.
Thanks so much for your support of Athens Locally Grown, all of our growers, local food, and our rights to eat it. You all are part of what makes Athens such a great area in which to live. We’ll see you on Thursday at Ben’s Bikes at the corner of Pope and Broad Streets from 4:30 to 8pm!
We’re starting to put a plan together on how best to use the space at Ben’s Bikes when the weather warms up and we really fill the back room. The first thing we want to tackle is the parking/walking space outside. The rain really did a number on the soil, and to make things worse the last storm took out one of those huge pecan trees behind the building. The heavy equipment needed to cut the thing up turned a large area of the lot to mud. We want to spread some gravel back there. Do any of you know of a source of free or cheap gravel that we can get delivered to the lot there? We can spread it around, but if the deliverer is able to do that too, so much the better. ALG depends on volunteer labor, so we don’t have much funds for this sort of thing. If you know of anyone who can help with this, please let me know.
We’re also making plans for an awning to give us more working space outdoors. We’ll put out a call for workers when it’s time to build that.
The Athens Farmers Market has closed for the winter. You can watch for news during the offseason on their website. The other area markets are also all closed for the season too. All but Athens Locally Grown, that is.
Please support your local farmers and food producers, where ever you’re able to do so!