How to start a market stall
Starting a market stall can be an excellent way to get your brand out there and start selling. From costs to equipment to legal legislation, here’s everything you need to know to get going
In order to start a market stall, you’ll need to:
Starting a market stall is one of the most popular routes into the permanent retail sector, and it’s not difficult to understand why. Not only is market trading a great way to test your business’ potential in a high-footfall hotspot, it’s also cheap, with relatively low start-up costs.
And with local, artisan products driving more interest than ever among consumers, it can also be said that there’s never been a better time to join a market.
As Samantha Wallace, founder of market stall business From Field and Flower, explains: “People seem to be more and more ingredient and food aware… that’s created a genuine interest in reconnecting with simple products, and knowing the producers that make them.”
However, market trading isn’t for everyone. The job entails early starts and long hours spent on your feet – potentially out in the cold, depending on which market you’re at. You’ll need to be approachable and friendly, with an understanding of sales.
But the job is flexible, and doesn’t have to be seven days a week. You might choose to start by trading one or two days a week, or only at seasonal markets.
So, if market trading sounds like it’s for you, read on to learn how to start a market stall…
Building a website for your business idea is easier than you might think. Our online tool ranks the top website builders that offer free trials.
1. Choose and source merchandise
First things first – if you’re going to open a market stall, you’ll need something to sell.
The first rule is that you have to sell something you’re interested in. Otherwise, customers will sense your non-enthusiasm, and won’t feel comfortable approaching your stall or speaking to you about your products.
Conduct market research
When you’ve got an idea of the products you’d like to sell, a bit of research should help you to refine that idea.
Look into what’s on sale in the markets you’re interested in (find more about choosing the right market in section two). The best way to get an accurate picture is to go out and explore the markets themselves, scoping out your competitors – i.e., the stalls that sell products similar to yours.
Most market managers aim to create diverse shopping experiences for customers, so it’s less likely you’ll be accepted into a market if it already sells something really similar to your products – not to mention that you won’t attract as many customers. As such, you want your idea to be as original as possible.
With this in mind, if a similar product to yours is already available in droves, you’ll want to:
- Rethink and come up with something more unique
- Tweak your idea so it provides a USP that your competitors don’t
- Seek out a market where similar products aren’t as readily available
While wandering each market, you might also decide to chat to some of its patrons about your idea. Would they be interested in buying your products if your stall opened here? Is there any way they think you could improve your idea?
Source your products
Whether you’re going to make your products yourself or purchase and sell them on, you’ll need to find a reliable and affordable wholesaler from which to source either your products, or the ingredients and materials needed to make your products.
To do this, try:
- Visiting local wholesale markets. These tend to open early in the morning, ahead of business hours, and sell a range of products
- Searching the internet for online wholesale directories, such as The Wholesaler UK
- Reading The Trader magazine, which advertises a variety of products
2. Pick a market to sell in
Next, you should start thinking about which of the UK’s many markets you’d like to start up in.
There’s plenty of choice here, so you should start by making a list of all the markets within a reasonable distance and learning as much as you can about them.
Then, you can narrow down your options by asking yourself the following questions:
- How often would you like to trade? You’ll need to pick a market that’s open when you want to be selling – whether that’s every day, every weekend, every other Tuesday, during the summer, or at Christmas.
- What are you selling? It could be that your wares are better suited to a farmers’ market than a city centre retail market, or would be more at home at a clothes market rather than a street food hotspot. Remember, though, not to set up in a market that already sells a lot of products too similar to yours.
- What’s your budget? Different markets will charge different pitch rental costs.
- What travel and parking arrangements will you need? Remember, if there are decent travel links and good parking capabilities nearby, more customers are likely to visit the market, too.
- Does it matter to you whether you’re indoors or outdoors? Some markets take place under permanent cover, while others are open to the elements.
- What would you like the vibe to be like? Do you favour a tranquil shopping experience or a bustling, energetic space? You won’t know what a market’s truly like to be in until you’ve visited it, so be sure to get out there and investigate.
3. Understand the start-up costs
It’s impossible for us to say exactly how much your market stall will cost to set up, as that’ll depend largely on what you’re selling, where you’re selling, and how often you plan to trade.
The good news, though, is that starting a market stall can be done cheaply. Sebastian Vince, founder of The Breadstall London – which started as a market stall in the Portobello Road market – recalls:
“I started my stall initially with £200, which I spent on buying ciabatta. Once I sold them, I bought more with the revenue the following week – it is possible to set up without much money.”
Meanwhile, a Startups Forum member says: “We purchased a stall for £200, obtained a pitch for £35 for a Saturday, and got market traders insurance for £47.”
However, there are more costs than just these to contend with. By no means exhaustive, this list should give you an idea of the main outlays you might face:
|You’ll need to buy:||Will that be a one-time or a recurring cost?|
|A market stall (if the market doesn’t provide one)||One-time cost|
|Designing and printing market stall signage||One-time cost|
|Market pitch rental||Recurring cost (could be charged on a daily, weekly or monthly basis)|
|Stock (or, if you make your products yourself, materials/ingredients)||Recurring cost|
|A market stall license||Recurring cost (to be renewed when asked by your local council)|
|Business insurance||Recurring cost (though often only charged on a yearly basis)|
|Staff wages (if you choose to hire any). Must be minimum wage or more||Recurring cost|
|Marketing and website building||Recurring cost|
|Equipment (such as a POS system, cooking appliances, display stands, etc.)||Either, depending on whether you buy or rent|
|A vehicle for transporting stock and equipment to and from the market||Either, depending on whether you buy or rent|
Want advice on starting a market stall leanly, from entrepreneurs who’ve been there and done it? Check out our interview with the founders of Shrimpy, who launched their successful street food pop-up with just £1,000.
4. Prepare yourself for market selling
The good news is that you don’t need any formal qualifications to sell in a market. Market trading often means rolling with the punches and learning on the job, though you’ll likely be given some informal training by the market you join at the start of your tenancy there.
However, if you want to make sure you’re as prepared as can be for your new venture, you might consider undertaking short courses in the areas of business that you’re not practiced in. For example:
- Understanding profit margins and calculating costs
- General business skills
Write a business plan
If you’d like to be ultra-prepared when it comes to the future performance and growth of your start-up, we’d recommend writing a business plan.
While you will need to invest time and effort into it – a good business plan should be detailed and comprehensive – having a clear blueprint for the future will likely pay dividends later, helping you to make decisions and measure your performance against your ambitions.
5. Adhere to market trading rules and regulations
When setting up a market stall, there are a number of regulations that you must comply with, and it’s vital that you’re aware of any statutory legislation applicable to you.
Follow this checklist to make sure your operations are legally sound:
✓ Obtain a market stall traders’ license
Whether you’re joining an established market or would simply like to set up a stall in front of your driveway, you’ll need permission from your local authority to do so – which means getting a market stall license.
Unfortunately, licenses don’t come free, and you’ll likely need to pay an administration fee. One Startups Forum user states that traders’ licenses cost, on average, around £1,000 to obtain.
Each region follows a different procedure, so get in touch with your local authority to find out how to apply for yours. It may be that your market makes it easier for you to pay for your trader’s license by including the fees for it in your pitch rental, so be sure to check whether this is an option.
✓ Register for self-assessment with HMRC
As a market stall owner, you’re technically self-employed. This means you will need to pay National Insurance contributions and register for the self-assessment tax system, which entails providing details of your income in self-assessment tax returns each tax year.
If you don’t register within three months of starting to trade, you could get heavily fined – the last thing you want when you’re just starting out.
To learn more about this, visit our guide to registering as self-employed.
✓ Get business insurance
As a market stall trader, you’ll need adequate business insurance. You should look to get the following cover:
- Public liability insurance, to cover you if a customer suffers an accident or injury at your stall. Most markets won’t let you trade with them unless you have this cover, and traders typically need cover of up to £5m.
- Product liability insurance, to cover you if a customer suffers illness, injury or property damage due to a product of yours.
- Employers’ liability insurance, which is a legal requirement if you hire staff, be they full-time employees or casual helpers.
You can learn more about the different business insurance types here.
It’s worth noting that, if you register with the National Market Traders Federation, you’ll be offered a free market trader insurance package consisting of public liability and employers’ liability insurance.
✓ Adhere to legal legislation
While selling in a market, you’ll need to adhere to the following legislations:
The Trade Descriptions Act – You’re legally obliged to be 100% honest about your products, so none are sold under false pretenses. Basically, don’t claim your jewellery was crafted in Milan if it actually came from Manchester.
The Consumer Rights Act – You are responsible for any fault found with your goods, even if the manufacturer caused it. So make sure you don’t sell anything subpar, or you might have to dish out refunds or compensation.
The Sale of Goods Act – The products you sell must be fit for purpose, and must be of satisfactory quality. Again, you’ll find yourself giving out exchanges, credit notes, or full refunds if this isn’t the case.
✓ Register for VAT with HMRC (if your yearly turnover exceeds £85,000)
Apart from on a few products, as of 2019, VAT is charged at 20% – meaning 20% of your sales will be paid to HMRC. You will, however, be able to claim back the VAT you’ve already paid on your purchases.
It’s important that you retain good, clear account books right from the start, and remember that after your first year of trading, you’ll be required to submit your accounts to HMRC.
Nick Stokes of Gourmet Goat street food says: “Because we’re a VAT-based business, we’ve got a VAT return every three months. You’ve got to save those receipts that you’ve got some input tax on. You’ve also got to get your VAT bill in on time, or you get a penalty.”
6. Join your chosen market
Get market stall equipment
Before you can get started, you’ll need some key equipment:
- A stall. Most markets provide the stalls themselves, but some will simply offer you a pitch, and require you to bring your own stall. This is more often the case for casual traders, and markets that are temporary. You can find cheap, second-hand stalls fairly easily, both via the internet and in trade publications.
- A point of sale (POS) system. You’ll need to be able to accept payments via both cash and card if you want to stay ahead of the curve. Mobile card machines in particular can prove very useful and efficient in a market environment. Check out our guide to POS systems for small businesses to learn more about what you’ll need.
- Signage for your stall. Displaying your business’ name and branding, you want your stall’s signage to compel customers to visit your stall – make sure it’s clear, legible and professionally printed.
Secure a place at your chosen market
It may be that you decide to start as a casual trader. Instead of renting a permanent pitch at the market, casual traders turn up early each morning and simply nab a pitch that happens to be empty that day.
This can be a great way to test your business at the market without committing to long-term rental. Plus, if you do well as a casual trader, the market manager will have more reason to accept your application when you do decide to apply for a permanent slot.
As every market is different – some are run by the council whereas some are privately owned, some are permanent while some are temporary, etc. – each market will have a different application process for their permanent stalls.
What’s universal, though, is that the market manager will be looking for enthusiasm and commitment – so make sure you display both of these in your application!
You can visit your chosen market’s website – or get in touch with its managing body – to find out what you need to do to secure your spot.
Now, you should be ready to get started in a market and start selling your wares to the public.
It could be that a market is the right place for you to be, even long-term – as Vince explains, “I believe that with certain products, such as ours, it’s better to have a market stall than a permanent shop.”
And if you opt to continue market trading into the future, there’s still opportunity to expand your business by opening more stalls in markets across the UK.
However, it could be that your primary motivation in setting up a market stall is to get your brand out there and test the idea to see whether it might have traction as a permanent shop – and that’s perfectly fine, too. When you’re ready, visit our guide to opening your own shop to learn more about this next stage in your business journey.
Alternatively, it could be that you want to drive awareness and test your products, but a market wouldn’t quite be the right location for you. In this case, you could consider opening a retail merchandising unit (RMU) instead – a temporary kiosk in a high-footfall area, such as a shopping centre or train station.
Whatever you decide to do, you’ll need to be able to accept payments. Remember to take a look at our guide to POS systems for small businesses, and to take advantage of our offer to help you find the right merchant account for you. Simply fill in the free form at the top of this page to receive bespoke quotes from top suppliers!