Thunder claps in the distance as the storm passes. It’s hot. 87 degrees Fahrenheit with 70% humidity. Oh yeah, that type of muggy morning. There will be more rain later in the day, but for now the sun seems to have broken through. A gust of cool air every now-and-then keeps things bearable. One of the dividends of life, in my view, is staying walking-distance from a vibrant small downtown. It’s Saturday in Pleasantville, NY, which means: Farmers’ Market! I go for the music to accompany my morning coffee; I stay for the people-watching. Today The Biryani Boys are performing, a duo playing Indian ragas on the sitar and tabla, which I don’t hear too often. I love different styles like this and am grateful for this impromptu experience. I will buy their CD later. Children are running around, families converse while enjoying the background music, shoppers are abundant, and there are plenty of volunteers to provide information and maintain the venue. This is a well-organized market.

I am starting to learn about viable business models and to recognize all the different moving parts that make a business like the Pleasantville Farmers’ Market successful. The market organizers credit three key ingredients to their secret sauce: good management, quality vendors, and interested shoppers. To summarize, a system like this works as follows. Management rents the venue, hires the vendors and assigns them in the market, organizes traffic flow and equipment, makes an uncountable number of small decisions to make a quality experience, etc., all while encouraging the longevity of the vendors, promoting the retention of consumers, and managing their finances. Vendors provide their products or services, customize the customer experience within their booth, and manage their finances. Customers spend their money, earned elsewhere, in exchange for products or services, and the money gets distributed amongst the providing vendors and the market itself.

So what actually affects the viability of this business? Every aspect of the market needs to make more money than it spends, on average over time, in order to remain viable. Each vendor is financially responsible for itself, while the market is responsible for all vendors and workers involved, as it provides the institution for which the vendors congregate and meet consumers. Income is solely based on consumer discretion, while costs include equipment, labor, venue, and interest payments on any loans.

On the front end, the vendors and overall experience of the market must provide value to consumers. This depends both on the supply side – the quality and marketing ability of the products and services – and demand side – the number of potential customers, their income and debt levels, and their eagerness to spend money on (often) discretionary items. Hence, a market’s viability depends on the consumer base, as exemplified by Walmart recently closing stores around Chicago. On the back end, viability is dependent on State economic and fiscal policy, tools that directly affect business costs and their bottom lines. This includes property tax, which affects costs of renting or owning a venue, sales tax, which affects the price of goods and services, and interest rates, among other powers that affect the willingness of consumers to spend money at farmers’ markets.

These factors affect many types of businesses, like farmers’ markets which organize vendors, and small townships which organize businesses. I’d be interested in a comparative study regarding what economic environments enable markets, such as the Pleasantville Farmers Market, to be viable and how these businesses either adapt with or fail due to changing economic landscapes. Just like farmers markets tend to be seasonal with which produce is offered and consumer demand, small townships, like Northport, MI., rely on seasonal tourism for the entire local economy’s annual income. How does wealth (i.e., money) flow in and out of these more insular communities and what indicators are there for their sustainability? As a third related concept, some large companies partition their annual budget among their business units which then act independently to achieve their designated goals. In order to delegate work to a different business unit, one must contract with another and exchange real or fake money. A capital economy like this is one mechanism for social organization. How do different intra-business economies compare in their time-efficiency, quality of production, and fair distribution of net proceeds?

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