Part four of a series in which SFoodie asks the question: With the
Underground Market now shut down, what would it take for San Francisco's
aspiring food microventures to go legit?
Up until the Underground Market and its imitators appeared, Bay Area farmers' markets were one of the best incubators for new food businesses, offering beginning vendors a way to introduce themselves to the public and build personal relationships with customers. With small, neighborhood farmers' markets continuing to proliferate around San Francisco, they're still a viable launchpad, though the waiting lists for top markets are ridiculously long.
SFoodie called up the Pacific Coast Farmers' Market Association, which runs 68 farmers' markets in San Francisco and six other counties, working with more than 900 farmers and prepared-food vendors. We asked them: "What does it take for a vendor to appear at one of your markets?"
PCFMA assistant director Allen Moy first listed the basics: a commercial kitchen, for one.
"They also need to submit an application, along with a $125 application fee. And they have to have general liabilitry insurance -- if someone gets ill, or if their tent should blow over, there's a level of financial protection we need to have." (As SFoodie discovered in part 1 of this series, liability insurance costs roughly $500 a year.)
The fees that PCFMA charges for a 10-by-10-foot booth are $40 per market day for prepared foods during the winter and $50 during the summer. Vendors cooking at the market pay $10 more. Each vendor is responsible for purchasing its own tent, table, signs, and other market-day supplies.
Not bad, really. Until we start talking about health department permits.
"If you're selling prepared food that you've made in a kitchen," explained Nate Jordan, who runs PCFMA's San Francisco markets, "you have to get a 'retail food vehicle permit.' That doesn't mean you're selling out of a vehicle -- it's for anyone who sells baked goods or hummus. The other category of permit is for vendors who are cooking on site, whether you're popping kettle corn or having a barbecue. For that, you'll get a 'temporary event permit.'" Information and application forms for these permits can be found on the SF Department of Environmental Health website.
"The permits are very expensive," Jordan said. "They're the highest in the Bay Area by far -- that's why the Underground Market was so popular. The retail food vehicle permit charges a one-time application of $308 and an annual fee of $777. You pay for it year-round, even if you're in a seasonal market. The temporary event permit is quarterly. You pay $138 for the application fee and then $250 per quarter." Each of those permits, SFoodie confirmed with the health deparment, are market specific -- meaning that if you sell at three different markets, you'll need three different permits.
The only vendor SFoodie knows who has already made the transition from the Underground Market to farmers' markets is Marge Bakery, which sells pies, cookies, and granola at the Inner Sunset Farmers' Market on Sunday. So we asked owner Megan Gordon about the differences between the two. "One Underground Market was worth three regular farmers' markets in terms of sale," she said. "At the Underground Market, people were throwing money at you -- people were drinking, and come 11 p.m., everyone was tipsy and wanted pie. I kept selling out."
"At the regular farmers' markets," she added, "your job is sales. People are walking around with carrots and you have to call out, 'Good morning! Would you like to try some pie?' If I sat in a booth I wouldn't sell much at all."
The full "Going Legit" series:
- Part 1: Getting a business license
- Part 2: Working out of a commercial kitchen
- Part 3: What's the minimum an Underground Market vendor would need to be legit?
- Part 4: Selling at the traditional farmers markets
- Part 5: Selling to grocery stores
- Part 6: The future of the Underground Market