The case can be used to illustrate concepts such as willingness to pay, reservation price, demand and supply curves (including their various shapes) and the advantages of location.
Safdar, a roadside fruit seller, faced the decision of whether to offer mangoes early in the season (June 2023). He had a good understanding of the ability-to-pay of many of his customers, but he could not know their willingness to pay for a particular fruit on a specific day. The popularity of mangoes meant that being the first to offer them could give him an advantage, attracting mango lovers who might be willing to pay a premium for the scarce fruit at the start of the season. However, Safdar had to weigh the costs and benefits of his decision, using his knowledge of his clients’ preferences and considering the other risks involved. As the case shows, Safdar was also grappling with the typical challenges and opportunities faced by street vendors in emerging economies.
The case demand, supply and location is primarily written for the participants of professional programs without any economics background. For instance, the case can be used in the Foundations of Economics course designed for master’s students planning to pursue specialization in Public Policy or Economics. The case can also be taught in the Principles of Microeconomics course at undergraduate level.
Teaching notes are available for educators only.
CSS3: Entrepreneurship.
