Factors affecting farmers market produce prices in Missouri

ABSTRACT

Produce marketers who participate as farmers market vendors or otherwise directly market their goods should understand not only the location-related characteristics that affect consumer selection of local, fresh produce but also the product attributes that consumers prefer to find in local products. Understanding attribute-price relationships will allow marketers to better plan for value-added marketing opportunities. Using a hedonic pricing model, this study analyzed the influence that product attribute levels have on prices for seven types of produce: sweet corn, tomatoes, cantaloupe, cucumbers, green beans, bell peppers, and zucchini. Based on data collected from Missouri farmers markets, multiple attributes affect produce price variation. In the dataset, one of the strongest effects was exerted by sale location. The importance of this finding is that prices can be collected in a single location and extrapolated to other farmers market locations, which implies reduced search and reporting costs in collecting representative farmers market produce prices. Additionally, a higher weight may increase prices for some types of produce but decrease prices of others after a certain point. Farmers market vendors, as well as other direct marketers, can use attribute pricing information to identify the quality attributes that consumers prefer.

KEYWORDS:

• Hedonic
• produce marketing
• farmers markets
• Missouri
• USA

Additional information

Funding

This work was supported by the National Institute of Food and Agriculture [2013-67009-20419];Federal-State Marketing Improvement Program [14-FSMIP-MO-0008];

Notes on contributors

Armen Ghazaryan

Armen Ghazaryan is a PhD student in the Department of Agricultural and Resource Economics at Colorado State University and formerly a MS recipient in the Department of Agricultural and Applied Economics at the University of Missouri. Can be contacted at [email protected].

Randy Westgren

Dr. Randy Westgren is a professor and the McQuinn chair in entrepreneurial leadership at the University of Missouri. Can be contacted at [email protected] or at 573-882-5049.

Joe Parcell

Dr. Joe Parcell is an MFA Professor of Agribusiness in the Department of Agricultural and Applied Economics and the Director of the Division of Applied Social Sciences at the University of Missouri. Can be contacted at [email protected] or at 573-882-7185.

Haluk Gedikoglu

Dr. Haluk Gedikoglu is an assistant professor of agricultural economics at Konya Food and Agriculture University, Turkey, and he formerly was a research assistant professor of agricultural economics at Lincoln University. Can be contacted at [email protected]. This project was partially supported by the National Institute of Food and Agriculture, competitive grant no. 2013-67009-20419, from the United States Department of Agriculture and partially supported by the Federal-State Marketing Improvement Program, competitive grant no. 14-FSMIP-MO-0008, from the USDA Agricultural Marketing Service.