Most markets and fairs that you will be going to charge a fee for their vendors to sell their goods. This fee goes by many names but we typically refer to it as a booth fee or vendor fee.

These fees can range greatly in cost from $0 to several thousand. The free markets typically have some form of corporate or community sponsorship to absorb the costs associated with hosting the market. Companies like Snooze Eatery here in Houston  will host a market during Sunday brunch as an added benefit to their patrons.

Other markets will require a fee to be a vendor. Smaller markets, such as weekly farmers markets may charge a nominal feel of $20 – $25. Larger markets, such as the Nutcracker Market in Houston cost several thousand dollars AND they want a percentage of all your sales. Thats a lot of inventory to sell!

The question that people often wonder is “where does this money go?” The answer depends on the type of market and whether or not it is a community market or a commercial market.

All markets should have a budget set for marketing. Everyone wants a successful market  and the market manager is responsible for performing these marketing activities. These marketing activities may include social media posts, printed advertising and even TV and radio. Keep in mind, however, that you can help advertise this market that you are going to as well. Repost their social media posts and help get the word out.

Most markets will also have costs associated with the location. Even public parks and churches will have fees associated with using their space or parking lot. This may be due to increased insurance costs or cleaning costs associated with the market.

Markets that are in warehouses or convention centers have a far greater lease cost than a parking lot might. You can expect the booth fee to be significantly higher for these markets. You can also expect to pay an add-on charge if you require electricity.

Setting up the market, managing the activity and tearing down common areas requires time and staff. Most markets will have staffing costs for people to perform these activities. It’s always nice to have staff available to answer vendor questions and provide assistance if needed.

Sometimes a market may be hosted as a fund-raiser for some activity, such as a school program or animal rescue. Some of your booth fee may go towards this fund in addition to costs associated with the market.

Some markets are commercial markets. This means that the market manager has created a business, similar to yours, for the purpose of producing a profit. They are using their event management skills to help you sell your products. Businesses like Vintage Market Days even franchise to different areas to capitalize on the name. I think this is an awesome business model and we are big fans of Vintage Market Days.

Another example of a commercial market is a married couple here in Houston. They organize markets on a regular basis to support their family expenses while she goes to Medical School. Their daughter is a staple of the markets now as she rides her tricycle from booth to booth.

For commercial markets, hosting a market is the market manager’s job. Just like you want to make money from your efforts, so do they. A good market manager’s value is often far more than the booth fee that you pay to join the market.

What you pay to get into a market will vary from one market to another. As your business grows, you will be paying more in booth fees to get into bigger markets and shows. As you learn your business, you will able to gauge what the appropriate booth fees are for your needs.

For us, we would like to keep our booth fees below 10% of our gross revenue. This means that we would like to make 10 times what it cost us to get into the market. We aren’t anywhere close to that though. As we are expanding to bigger markets, our booth fees are about 22% of our gross revenues right now.

As we come into the holiday busy season, explore your options and be smart when choosing your market.

See you at market!