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Management in Practice

Are markets local or universal?

A market is a place (virtual or tangible) where buyers and sellers meet. Markets exist everywhere people do. But each market has its particular customs, as simple as a handshake or as intricate as a 40-page contract.

Night Bazaar, Chiang Mai, Thailand

Chiang Mai is a market city. At midnight when the Muay Thai matches end, in the morning beside highway commuter traffic, and even during the monsoons' floods, nearly every side lane, riverbank, and road shoulder hosts a clutch of canopied stands and cooking carts. Food markets sell fresh produce, take-away baggies of soups and curries, gelatinous sweets, and dried squid on sticks. Others sell trendy clothes to students on lunch break, while specialty markets — vegetarian, flower, motorbike, etc. — lure shoppers on a mission.

Chiang Mai's largest and most famous market, the Night Bazaar, seems an ersatz reproduction of such homegrown exchanges. With an overwhelmingly tourist clientele, vendors solicit aggressively in English. McDonald's and Burger King cast rival neon glares along the main drag.

Yet for all its fluorescent sprawl, the bazaar still has elements of a mom-and-pop shop. Communal dogs loll on the cooling pavement; vendors' kids dart off to borrow change; and merchants gather to dandle each others' babies on the corner. Speak Thai to the dried fruit vendor near Starbucks, and you'll come away with a pocketful of free samples. Meanwhile, sparks shimmer down from a rooftop welding job, strings of colored lamps cast polka dots on passersby, and costumed dancers wend through the stalls.

The market began as a center for the sale of traditional Lanna handicrafts to tourists. These days, bootleg DVDs and airbrushed T-shirts outnumber handmade goods. According to one fake-Coach-purse vendor, a portly man who goes by Bet, the majority of the Night Bazaar's business still comes from foreigners, but it's now local shoppers who show interest in handicrafts.

Most vendors are former farmers who set up shop in the city, reflecting a national trend away from agricultural labor. According to Kitja Topaiboul, a professor of economics at Chiang Mai's Payap University, such vendors invariably make better livings in their new line of work. Though halcyon days of 100% profits have faded as competitors crowd in, 20–30% profits on handicrafts are still the norm.

At the Night Bazaar, stalls in the roofed pavilions sell higher-quality goods and rake in higher earnings. In the street-side stalls, where rent is cheaper, vendors selling mass-produced handbags, fake pashminas, and discounted liquor turn a marginal profit. Next come the makeshift stalls hawking knickknacks, and last are the roving hill tribe peddlers.

These women, natives of Hmong villages in the surrounding mountains, are a Night Bazaar staple. Decked in headdresses and slung with woven bags, they lag behind tourists, thrusting out souvenirs — often carved wooden frogs that croak when stroked. Meanwhile their children, draped with strings of flowers to sell, wait plaintively at shoppers' sides. (Topaiboul says many of the hill tribe vendors are imposters, immigrants from Burma and Laos who "make a mess" of the city with squatter camps and earn money that Thailand's economy never sees.)

While the Night Bazaar has long been a tourist attraction, the vendor Bet, sweating in the evening heat and worrying the change purse perched atop his belly, bemoans Chiang Mai's weaknesses: a lack of direct international flights, tourists who keep to backpacker budgets. He asks me whether I've seen fake Coach purses like his in New York, and I answer that I have. "See," he confides, "you don't have to come all the way here for fake Chinese bags."

Indeed, Bet has a friend now selling Thai handicrafts in San Francisco, though he himself would never leave. Here, he has family, a 26-year-old business, limited police oversight, and a streetful of competitors who, when a stranger asks for "Bet," will point right to his rival shop and recommend the fried rotee next door.

By Leah Rubin-Cadrain

Souks in Fez, Morocco

As one walks over the crooked stones lining the conurbation of hilly alleyways that form the medina of Fez, the smell of mule dung hangs in the musty air, as it has for over a thousand years. From the 11th to the 15th centuries, this was North Africa's epicenter of commerce, science, and religion. Saints lived and died here. Kings chose it for their thrones. Bartering still means boisterous haggling while shopkeepers offer sweet mint tea. Transporters yell "balak!" ("Clear the path!") leading overburdened animals of labor.

Several medinas exist in Morocco, but Fez is the most alive with trade, having sustained itself much longer than many of the bulwarks of free enterprise in the West. The perplexing labyrinth is separated into souks, or markets, where one type of good is made and sold. Brimming with tourists and locals alike, the densely packed lanes are teeming with fruit stands, meat stalls, and vendors plying passersby who offer the slightest glance.

Faux guides — false guides — were once abundant in Fez, leading tourists through the morass of alleyways. But government crackdowns now mean heavy fines and jail time for those caught. While an educated, certified guide could recite facts about the city's history, one faux guide named Nasser agreed to reveal the medina's nitty-gritty way of business.

Nasser, short but stout, patrols the medina with a mafia boss's aura. Every shop owner stops and greets him. The police say nothing. "I have two businesses," Nasser states. "First, I buy and export. When I have time, I take tourists." We stop at the brass workers' souk. Raw brass has doubled to $13 a kilogram. The Moroccan dirham stands strong to the weakening dollar, and the cost of a handcrafted brass tea plate — requiring three days of intense artisanship — has gone from $80 to $100. "We start the tourist price at $200. We settle for lower," Nasser continues. "The real price is $40. If I bring a tourist, I make more than $20. We all make our livings, you see."

In Dar El Kholkhal, a ceramic shop, no inventory exists on paper. "I walk around my shop early every morning," says the well-respected owner, Haj Mohammed, in his throaty, unfiltered voice. "That is [how I check] inventory. And, buying...I buy from artisans, sell to Moroccans and tourists. Older items get high prices." He adds that he encounters no government restrictions in running his business, "although I must pay taxes."

Moroccans and tourists often travel to Fez just for its renowned leather — jackets, pants, cushions, lamps, and world-famous babouches. We gaze down from one of the abundant boutiques that encircle the fetid tannery where a work spot full of yellow, brown, and orange dye-filled vats is cherished and passed down from one generation to the next. "It is the dirtiest work," Nasser articulates as the malodorous concoctions bubble below. The workers' splotched skin matches the colors of their dyes. "The leather has to be cured so it sells. The difference between who makes the real money is whether you are standing here or laboring down there," he ends without sentiment.

By Thomas Hollowell

City Farmers' Market, New Haven, Connecticut

Jennifer McTiernan H. moved to New Haven's Wooster Square soon after graduating from Yale in 1999, and she quickly discovered that she could get some of the best pizza in the world in the neighborhood, but couldn't find a fresh tomato. With no experience, she and four friends launched a farmers' market with seven participating farms in Russo Park — an easily overlooked strip along DePalma Court. They had no idea whether people would respond. "We opened at 10 a.m.," said McTiernan H. "By noon, all the farmers had sold out."

CitySeed, the organization they created, now runs markets in four locations — downtown, Fair Haven, Wooster Square, and Westville — on four different days of the week. The first is still the biggest: there were fifteen vendors on a warm, dry Saturday in August. Produce was carefully laid out on tables: herbs, vegetables, honey and bee pollen, salad dressing from the Herban Gourmet, lamb shepherds pie, greens from Two Guys From Woodbridge, cut flowers, lobster and oysters, and milk. The bounty reflected what's in season in Connecticut.

One of the most popular items is the chocolate milk sold in glass bottles by Trinity Farm of Enfield. The farm will sell more than 30 quarts of the chocolate goodness at $3.50 per bottle, in addition to its selection of skim and whole milk and four different varieties of yogurt. The appeal, said owner Dale Smyth, has to do with source of the milk: 50 grass-fed Holstein cows. "Holstein milk is sweeter than Jersey cows, which is what most milk comes from," she said. "And it matters to customers that we don't use hormones or antibiotics and that the milk comes from one farm. Nobody handles it except us."

This is the ethos of the farmers' market: small producers working close to the earth in the way people imagine it was done before farming became industry. From the beginning, CitySeed's ambitions have been greater, focused not just on strengthening local farms but on using the markets to bring healthy, organic food into underserved inner-city neighborhoods. All sellers at the markets must be WIC-certified, allowing them to accept state vouchers from low-income women. CitySeed also pushes them to get approved for food stamps; in fact, the New Haven farmers' markets are the only ones in the state to accept the stamps. Last year, CitySeed redeemed more than $50,000 in WIC coupons, mostly from the Fair Haven market, which resides in a poorer, predominantly Hispanic neighborhood; the market pumped $1.3 million into the local economy, according to McTiernan H.

To the customer, though, CitySeed offers a traditional farmers' market experience, with the emphasis on the food and how it was produced. Standing between the meat guy and a stall selling organic vegetables, Nora Bowman explained how the clams and oysters sitting on ice in a cooler were plucked from the waters off Branford by her mother just the day before. "We don't really make any money doing this," said Bowman, adding that most of their catch goes to big wholesalers and restaurants. "But we like being out in the community and we like that there are people who come back every week, rain or shine."

Or even in the dead of winter. During the winter, the Wooster market opens once a month. For Smyth, the market's success lies in the fact that she sells as much on a snowy February day as on a perfect Saturday in August. Trinity Farms is one of an increasingly smaller number of dairy farms in the state. Between 1997 and 2002, Connecticut lost a greater percentage of its farmland than any other state. Smyth sees the CitySeed market as nothing short of a lifeline. "In 25 years of running this dairy, this is the most encouraging thing," she said. "It's nothing to drive nearly two hours to get here. We're thrilled to do it."

By John Zebrowski