FEATURES
Market Analysis for Small Farms

by Marcia Passos Duffy
New York’s MarketMaker free online tool

Finding the demographics of a market—and pairing a product to the right niche—used to be the exclusive domain of large producers with deep enough pockets to pay for a market analysis.

Several state cooperative extensions and agriculture departments—the latest being Cornell Cooperative Extension/New York City—have now created a free in-depth marketing tool to help small or mid-sized producers get sophisticated data to help them reach thousands of potential buyers.

The Web service, http://www.nymarketmaker.cornell.edu , is a GIS demographic mapping tool that is part of a growing national network of MarketMaker sites hosted by state land-grant universities to provide access to a database of growers, wineries, food processors, wholesalers, retailers, farmers’ markets and restaurants in a particular state.

Any producer or grower in New York can get listed on the site for free, can access census data to determine where targeted buyers are located in a given area and can find markets for products, such as farmers’ markets, natural food stores, grocery stores, restaurants and other retail locations, in a map-based format. This kind of information is particularly important to the small producers with farms of 100 to 5,000 acres clustered in New York and New England that produce specialty foods are usually cannot get this kind of data.

“The purpose of MarketMaker is to level the playing field,” said John Nettleton, senior extension associate at the Cornell Cooperative Extension in New York City. “With this tool, small to mid-level producers have similar market intelligence as the bigger producers... it gives the small mom-and-pop [store] more access to niche marketing, which is a costly tool often unavailable to them.”

Not only does the site have the tools to help farmers discover niche markets, it also allows farmers to become part of a database that allows customers to find their farm and products. “Many small producers are not yet on the Web... and if they are in the MarketMaker database, they don’t need a site,” said Nettleton.

Currently, many farms have already been entered into the database; however, if certain producers have not been included they can register the farm by filling out a PDF form available for download on the site. Online self registration will be available in 2008.

MarketMaker was originally de-signed and launched two years ago by a team at the University of Illinois to help specialty and organic beef producers in the state access to the Chicago market. It has since been expanded to include all foods—often foods that exist only regionally—and is now also available in Iowa, Nebraska, Kentucky, Mississippi and Georgia. In 2008, three more states are slated to go online: Indiana, Ohio, Michigan and the District of Columbia. However, Nettleton noted, not all states will want to jump on board with MarketMaker. “It is expensive to set up... costing about $65,000 to purchase the private retail data,” he said. “Not all state agriculture departments or cooperative extensions want to do this because they have their own databases,” he said.

The NY MarketMaker site gets anywhere from 30,000 to 60,000 hits a month from a variety of sources; the site will soon be linked to new national MarketMaker portal hosted by the Agricultural Marketing Resource Center at Iowa State University, which currently receives over 3.5 million visits each month.

How MarketMaker can help

New York’s MarketMaker site has been online for six months and success stories of business relationships are beginning to emerge. For example, a school district in Binghamton, N.Y., is now using the site to source local vegetables. “The goal is for producers to discover untapped markets,” said Nettleton. “Restaurants, schools and hospitals won’t give up their brokers and distribution network, but if they can source local produce or other farm products, they can certainly tell their brokers where to purchase locally.”

It can also help growers decide if there is a market for a new product they are thinking about introducing. For example, if a producer wants to introduce organic eggs, he or she can use MarketMaker to find out if there is a high-income population in the area who are most likely to purchase organic products. He can also find out where there are grocery or other natural food stores that will potentially purchase the organic eggs. “This kind of information can help farmers make more intelligent decisions about introducing a product to a market,” said Nettleton. Farmers’ markets can also use the site to make similar decisions. “There is usually a very steep learning curve for new farmers’ markets... this tool is a way to accelerate that.”

In addition to scanning databases, the site will also be enhanced in the upcoming months to include the following:

• Improved Registration

Producers and markets in the MarketMaker data base will be able to create, edit and maintain their own online profiles with a password access.

• Customized Market Profile

Users will be able to build a trade area by clicking on the targeted census tracks. Queries and demographic information can then be summarized by the selected trade area and printed as a PDF document.

• Consumption Pattern Data

A new query feature will allow users to search for and map the highest concentrations of food consumer by product in a given area.

• Buyers and Sellers Forum

Food supply chain enterprises will be able to make weekly posts announcing requests for and availability of food products, offering an avenue for potential business relationships to develop.

Building a New Market for Cattle

The following case study has been adapted from the NY MarketMaker Site.

Larry is a cattle producer who would like to sell a branded beef product to high-end consumers. He thinks the best potential customers would be households whose income is in excess of $100,000.

Larry wants to use MarketMaker to learn three things:
1) Where are the highest concentrations of high-income households?
2) What are the names of the grocery stores that serve those high-end neighborhoods and where are they located?
3) What are the names and locations of meat processors?

The first thing Larry needs to do is to find the highest concentration of high-income households.

From the “Begin Your Search” page, http://www.nymarketmaker.cornell.edu/search_type.aspx , Larry selects “Find a Market.” In drop box, he chooses “Income.” In drop box “Select Income,” Larry chooses “Household income $100,000 and over.” In County, he chooses the county he wants to search in. In this case, Tompkins County. Click “Map It”

A map of the county area will show the census data requested. The legend indicates the number of households in each census tract. The light green color has the largest number of households for the selected census category, “Household income $100,000 and over.”

Larry wants to focus on the census tracts with the highest concentration of high-income households. He zooms in around the areas where these households are located by drawing a box around that area. (Hold down the left mouse button and draw a box.)

Using the “Identify” button to the left of the map, Larry can click on a specific census tract within the map to collect census data.

Larry has determined his target market will be a high-end consumer. By following the steps to answer question number one, Larry has narrowed his focus on a specific area. If that area has a vast amount of grocery stores, he will need to narrow his target market as much as he can.

Larry chooses an area for a target market of grocery stores with high-end consumers. To search for grocers, he clicks on the “Find Business” tab located to the right of the map. In the “Select Category” drop-down box, he selects “Retailers: Food.” In the box that appears under the category, he selects “Grocers,” then clicks on “Search Food Retail.” The speed of the grocery store mapping will depend on the number of grocery stores in the chosen area.

Once the grocery stores appear on the map, Larry has two options. He can identify individual grocery stores by using the “Identify” tool, or he can click on any grocery store marker to receive information on that store. Below the map, the name and address appears. In addition to the grocery store, there will be census data that refers to the census tract that the grocery store resides. Within the same area, Larry can find out more about the specific store by clicking on “Detail,” which provides information about a business that includes the name, address, telephone number, Web site address, sales volume, number of employees, business type and industry classification.

The results of the search should appear in a table below the map. If not, click on the “View Results” tab to the right of the map. A results page will appear below the map listing all of the grocery stores in the area of the map. Within the search results, “MapIt/Detail” is for the individual record in that row. Larry can click on “MapIt” and “MarketMaker” will map only the individual record. If he wants additional information on a particular grocery store, Larry can click on “Detail” within that individual record.

Larry has decided to contact a small grocer to market his beef. Even though there are larger ones in the same area, he realizes he cannot supply them with the amount of product they need and he will not have as much control on the price of his product.

Here’s what Larry needs to do to find the names and locations of meat processors:

• From MarketMaker’s Begin Your Search page, he selects “Processors-Meat Products” from the “Find a Business” dropdown menu. He wants to search the whole state.

• Larry has a choice of locating meat processors by location and/or facility type. He has no preference to location, but would like a facility that is federally and state inspected, so he selects this from the “Inspection Type” radio buttons.

• Once selected, the search results will be displayed. Within the search results, “MapIt/Detail” is for an individual record in that row. Larry can click on “MapIt” and “Market-Maker” will map only the individual record. If he wants additional information on a particular processor, he can click on “Detail” within that individual record. The details include contact information, location, sales, number of employees, business type, USDA and state Department of Ag processing plant number and facility type. Larry can also click on “Map All” and view all of the search results on one map.

Now, Larry can identify what processor has the capacity to work with him.

For more information on NY MarketMaker, visit http://www.nymarketmaker.cornell.edu or contact John Nettleton or John Ameroso at 212-340-2900, jsn10@cornell.edu or jma20@cornell.edu .

To register your farm for this free service, download the form at www.smallfarms.cornell.edu/pages/MarketMaker/reg.form.doc (Word doc). To send in your form, or if you have questions, contact John Ameroso, Cornell University Cooperative Extension/ NYC, 16 E. 34th Street, 8th Floor, New York, N.Y., 10016-4328.

The author is a freelance writer from Keene, N.H.