Are you a market manager looking to increase your farmers market profitability? Or a farmers market vendor hoping to optimize your farmers market sales?
Consider a model that helps you expand your customer reach, increase profitability for the market and producers while potentially serving more producers. Click and collect is a hybrid e-commerce model that makes local sourcing easier for consumers while preserving the direct vendor-to-consumer connection that has made farmers markets desirable.
For decades, farmers markets have been one of the most accessible and reliable market channels for local farmers, ranchers and food-based artisans. In 2020, 59% of the $2.9 billion direct-to-consumer farm sales reported by the United States Department of Agriculture (USDA) were made at farmers markets or on-farm stores.
But, farmers markets are no longer the only venue for local food. In fact, after years of expansion, farmers market growth slowed to just 1% between 2016 and 2017 and now remains “modest and stable,” according to the USDA. Many U.S. farmers markets report declining sales as they face stiff competition from box home delivery programs, expanded grocery store offerings, direct-ship from food-based websites, and other intermediary sales opportunities.
Luckily, the advent of more responsive and consumer and vendor-friendly online marketplace technology has evolved into a ‘click and collect’ solution. Giving farmers markets a new way to boost their producers’ sales and regain market share by taking advantage of new online consumer shopping habits.
What is “Click and Collect?”
Click and collect is a hybrid e-commerce model that rapidly rose to prominence during the Covid-19 pandemic shutdowns. In a click-and-collect scenario, a shopper selects and purchases their items online and then picks them up at a pre-determined time from a pre-determined pick up location.
Click and collect was quickly adopted by retailers, from grocery stores to home goods outlets, as a way to preserve sales while still observing pandemic shutdown rules or accommodating consumers who didn’t want to put themselves at risk. Even as shutdowns eased, many retailers retained their click-and-collect programs simply because so many consumers prefer the convenience of ordering online and picking up rather than in-store shopping.
Have you noticed the designated parking spots at the grocery store for “customer order pickups?” That’s click and collect in action.
A farmers market click and collect strategy allows local food producers to compete with big box stores through aggregation at the farmers market level.
Why Consumers Like a Click-and-Collect Option to Farmers Market Shopping
- Because they can pre-order, they can get what they want and menu plan for the week.
- Lock in seasonal, limited-quantity items like berries or local eggs.
- No need to stand in line or fight crowds.
- A quick in-and-out stop. Less time shopping, more time to do something else.
- For markets hosting an online hub, consumers can order from many different vendors but only pay once, making purchasing and budgeting more convenient.
3 Click and Collect Models to Boost Farmers Market Sales
There are three ways to adapt the click-and-collect online ordering model for farmers markets.
#1 – Partial Aggregation
With this strategy, a farmers market creates an online hub where shoppers can aggregate all their online market purchases. But consumers pick up their pre-ordered from each producer individually.
Pros: Makes shopping more convenient for consumers. Capitalizes on the marketing power of a farmers market, driving up sales for all participating vendors. Encourages consumers to ‘shop the market’ while picking up, and shoppers still engage with each vendor at the pickup but the market doesn’t have to spend time aggregating orders.
Cons: The consumer has to run down their order from each producer. Depending on the market e-commerce rules, multiple vendors may compete with each other by selling the same thing. This model also requires that an online vendor has a physical presence at the market.
A joint-ordering platform/separate pickup model can be the perfect choice for a farmers market looking to boost sales during their scheduled season without over-committing already busy market management staff. It can also work to ease a farmers market, vendors included, into an online model without committing to a more logistically-complicated aggregation and single pickup model. Allows vendors (and the market) to have their cake and eat it when combining the traditional farmers market experience with online sales opportunities.
#2 – Full Aggregation
In this application of the click-and-collect concept, orders are aggregated both in ordering and pickup. Many markets adopted this model as a way to stay in business during the pandemic restrictions. For example, farmers markets created ‘pre-order and drive-through pickup’ systems allowing producers to sell their goods to local consumers while still observing isolation rules.
But even as farmers markets have reopened without restrictions, the aggregated order and pickup model can offer new sales opportunities.
Pros: The most convenient system for consumers to use as both ordering and pickup are aggregated. This model can complement a physical market, but does not require a physical market, just a pickup location. Physical market or not, a virtual market can create an opportunity to expand choices for the consumer while providing the local entrepreneurial food community a low-cost sales channel. This model has the greatest potential to enable consumers to “fill up their shopping cart” as they would in a regular grocery shopping experience, potentially locking in weekly routine customers that use the farmers market as their grocery store.
Cons: Decreases the opportunity for shoppers to browse for additional ‘impulse’ buys. Requires a committed marketing push to reach a wide enough audience to justify the investment in resources to aggregate and pack orders. Depending on how the online shopping experience is setup, vendors may be competing online with others selling similar products.
The full aggregation model is an excellent way to extend the marketing power of a traditional farmers market. For instance, a seasonal, open-air farmers market may be able to open for winter sales with a fully aggregated ‘winter season’ order and pickup option that doesn’t require a large (and expensive) indoor venue. Or, a farmers market group can add a day or even an additional location beyond their regular market day hours and location. In regions with little foot traffic, a fully aggregated option may be more feasible for farmers and producers to participate in than having to invest in a booth display and spend an entire day sitting at a market site.
#3 – Aggregation Plus Delivery
Another excellent option for farmers markets is adding delivery to a full aggregation model.
During the pandemic, delivery was important to capturing consumer business. Many grocery stores, for instance, leaned heavily into third-party delivery services. Now, as we return to our new normal, delivery is slowing down. However, delivery can offer a valuable component to a farmers markets online strategy especially considering that there are competitive services that will aggregate and delivery from farmers markets but at a hefty chunk of the order – typically greater than 20%.
Pros: A delivery service may be able to reach customers not able to collect their order, including seniors with limited transportation or busy families that don’t have the time to swing by the market. And do it less expensively than other options currently available to consumers.
Cons: Density matters. A delivery service only pencils out if the delivery zone is limited to a dense area, say within city limits or specifically targeting neighborhoods or apartment complexes that may be home to your target audience. There are also additional costs to consider. Does the farmers market have the funding to purchase a delivery vehicle plus cover labor? Or can you justify the cost of a delivery vehicle with a small delivery fee and a high-enough volume of sales?
For the right market, aggregated online orders plus delivery is a great option for further boosting producer sales. Consider carefully your bottom line and the potential impact for expanding your market sales. If the extra costs outweigh the potential increased sales or can’t be made back with reasonable delivery fees, consider partnering with an existing delivery service.
Contact Food4All for Our Marketplace Online Solution
Are you a farmer or food artisan interested in adding an online strategy to your farmers market sales this season? Or a market manager looking for ways to boost your overall market sales? We can make either happen! Contact Food4All today for a free demo or to talk to one of our friendly staff members.