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Fall 2012 Market-ability

Looking for a boost in traffic, shopping centers have taken to hosting farmers’ markets on their grounds. Is the strategy working?

CrossroadsBellevue3-copyOver the past few years, as shopping center dynamics have changed, so has the retail mix. Services are fast becoming a crucial component of many a shopping center and ideas to attract regular foot traffic abound. A farmers’ market is one of them. Farmers’ markets bring loyal, weekly shoppers who come for fresh produce, artisanal breads and other goodies and then – important for the centers – shop the stores.

“Shopping centers are a well-known landmark [in] many communities, where people come for shopping as well as community events, and in my personal opinion, a farmers’ market is a good fit for this type of environment,” says Les Morris, director of corporate public relations for the Simon Property Group, headquartered in Indianapolis, IN.

Setting one up is not easy of course. It takes a lot of work, specific expertise and a good Rolodex. There are several ways to incorporate a farmers’ market into a shopping center setting. Here’s a look at how three centers brought the concept into their mix – and how it’s working for them.

Crossroads Bellevue Shopping Center

CrossroadsBellevue4-copyCrossroads Bellevue Shopping Center in Bellevue, WA, a 40-acre shopping area that includes a mall, is a retail hub which hosts a diverse range of community activities including live music and the like. Still, says Susan Benton, something was missing. About seven years ago, the center decided it needed a farmers’ market to bring the community in.

Benton, a property director with Sher Partners in Bellevue, the management company for the shopping center, spearheaded the launch of the farmers’ market seven years ago and has run it since.

The seasonal market is set up in a designated parking lot every Tuesday from noon to 6:30 p.m. Tuesday was chosen because it is a quiet retail day. Since the early days of the farmers’ market, traffic has doubled. “We see 6,000 people a day in the market,” Benton says. And the increased traffic spills over to the mall. “Our large retailers report that their business has doubled for Tuesdays, and restaurants and food courts are seeing a triple turnover at lunch on Tuesdays, which is more typical for a Friday or Saturday evening.”

Crossroads Bellevue, however, has not considered expanding the market to additional days. “It’s a lot of work, and the vendors that come here on Tuesdays travel to other markets on the other days of the week,” Benton points out.

Vendors pay $25 per stall per market day, plus an annual membership fee of $45, and the farmers’  market has been profitable since its first year, exceeding Crossroads Bellevue’s goal of breaking even. Still, Benton says the company considers the market to be a service to the community and doesn’t count it as an income center.

There are many challenges associated with setting up a farmers’ market. “It takes a lot of time and manpower, and there are initial marketing costs,” Benton says. “In many places, farmers’ markets are set up by nonprofit organizations. Our problem was finding someone who knew how to contact the farmers.” The company was able to find an experienced farmers’ market manager with contacts who was familiar with health department rules. “We started marketing and advertising the market, which we know how to do, and soon we had 15 vendors,” Benton says. That number has since swelled to 43, with offerings including organic fruits and vegetables, fresh flowers, baked goods, specialty teas and coffees, authentic tamales and pizzas, and handmade soaps and jewelry.

According to Benton, Crossroads Bellevue was one of the first farmers’ markets to offer a token system to accommodate shoppers using only credit cards or food stamps. “No one carries cash anymore,” Benton says. “We have a market hub tent with a wireless credit card machine. We swipe the card and give people tokens worth $5 each, which they can use to buy what they want from the vendors. At the end of the day, we give the vendor a check for the amount of money in tokens that was spent. It’s like a cash register.” Benton says the token system has increased sales at the farmers’ market “tremendously.” She adds, “It makes it so easy to come and shop here.”


The Commons at Federal Way

CrossroadsBellevue5-copyThe Commons at Federal Way in Federal Way, WA, opted to go through the Federal Way Chamber of Commerce to set up a seasonal farmers’ market. “The chamber had done it before and had expertise setting up farmer’s markets,” says Lee Eckholm, national retail director for Provenzano Resources Inc., which oversees the project for the mall. The chamber charges vendors to be a part of the market, which is also sponsored by several local businesses.

The farmers’ market, which has about 50 vendors, has worked out well for the mall in the Seattle suburbs. “It’s a good fit for this area. A lot of people are into the outdoor lifestyle and organic food, and they don’t mind spending a little extra to buy fresh produce from farmers,” Eckholm says.

Open Saturdays from 9 a.m. to 3 p.m., the market has been a positive for the mall, whose anchor stores include Macy’s, Target and Sears. The mall also has a 16-screen movie theater. “I think the market has helped created a destination for people. It’s a community-based shopping center, and many people come here every week for the market,” Eckholm says. “Any exposure to the mall is good exposure.” To encourage farmers’ market patrons to visit the stores in the mall, the market features a table with coupons and other promotional materials that mall tenants are invited to put out.

The farmers’ market hasn’t taken way from any of the businesses in the mall. “It’s not stepping on anyone, and it hasn’t hurt the mall in anyway,” Eckholm says. “But is it a giant traffic-driver? Not so much. There are some people who just come to the market and go home.”


Stanford Shopping Center

Commons1-copyThe market at the Stanford Shopping Center, a Simon property in Palo Alto, CA, differs from a typical farmers’ market in that it’s all one company rather than a collection of individual vendors. Sigona’s Farmers Market leases 3,500 square feet of space for its European marketplace-style market, which is partly indoors and partly outside and is in a section of the mall that is referred to as the street market.

Located on the campus of Stanford University, the Stanford Shopping Center is an upscale, open-air center with gardens, sculptures and fountains. It features more than 140 stores, including Neiman Marcus, Nordstrom and Bloomingdale’s.

Considered a specialty retail tenant, Sigona’s Farmers Market is a family-run business that started in 1975 with a couple of fruit stands. Today, it has two locations, including the shop at the Stanford Shopping Center, which it opened in 1999. Its flagship store is located in nearby Redwood City.

Sigona’s sells a variety of products from local, family-run farms and other local suppliers. About 53 percent of the offerings are fresh fruits and vegetables. The market’s other products include close to 200 varieties of dried fruits and nuts, along with a wide assortment of cheeses and artisan breads and other products.

The Stanford market is open seven days a week all year. “It’s very unusual for a mall to have a farmers’ market that’s open every day of the year,” says John Sigona, Jr., a co-owner of the market. The reason there aren’t more markets like Sigona’s at malls is that it’s not an easy business, Sigona says. “It’s a high-labor and low-profit business, and we’re dealing with highly perishable products,” he says. “In good malls with a lot of traffic and high turnover of merchandise – which is where you want to be – the rents are high, and it’s hard to turn a profit,” he says. With outdoor markets, there’s also a greater risk of theft, he adds.

The market has about 25 employees and is staffed from 3:30 a.m. until 9:30 p.m. Fresh deliveries come in every day, and the store opens at 9 a.m. every day and closes at 7:30 p.m. Monday through Saturday and at 6:30 p.m. on Sunday.

“We draw in customers that come to the mall for us and then do other shopping,” says Sigona, who notes that a couple of other malls have approached him about opening markets over the years, but the deals didn’t come to fruition.


Bernadette Starzee

Starzee, a Long Island, NY writer who covers business, sports and lifestyle topics, is a senior writer for SRR. She can be reached at .

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