Shortening Supply Chains: Experimental Evidence from Fruit and Vegetable Vendors in Bogota 2016-2018
Other Household Survey [hh/oth]
Fruit and vegetable vendors in Bogota travel most days to a central market to purchase produce, incurring substantial costs. A social enterprise attempted to shorten the supply chain between farmers and vendors by aggregating orders from many small stores and delivering orders directly. We randomized the introduction of this service at the market-block level. Initial interest was high, and the service reduced travel time and costs, and increased work-life balance. Purchase costs fell 6 to 8 percent, there was incomplete pass-through into lower prices for consumers, and markups rose. However, stores reduced sales of products not offered by this new service, and their total sales and profits appear to have fallen in the short-run, with service usage falling over time. The results offer a window into the nature of competition among small retailers, and point to the challenges in achieving economies of scale when disrupting centralized markets for multi-product firms.
Kind of Data
Sample survey data [ssd]
Unit of Analysis
The survey covers firms in Bogota that sell fruit and vegetables and were part of an impact evaluation
The scope of the survey includes:
- Baseline survey : Preliminary questions; Vendor information; Business information; Financial information; Agruppa products; Purchases; Work life balance; Interest in agruppa
- Follow-up survey (6 months and 12 months): Preliminary questions; Vendor information; Agruppa products; Business information; Financial information; Purchases; Work life balance
- High Frequency Survey: Preliminary questions; Purchases; Agruppa products; Business Information
- Customer Survey: Preliminary questions; Shopping decisions; Customer information
Producers and sponsors
David McKenzie - World Bank
Innovations for Poverty Action
All neighborhoods in Bogota are classified by the government into one of six socio-economic strata, classified from 1 (poorest) to 6 (richest). Our focus is on poor neighborhoods (strata 1 to 3) in the South-West of Bogota, not immediately adjacent to Corabastos. Agruppa went door-to-door along streets in these neighborhoods in January and February 2016 (see Appendix 2 for a study timeline) to identify stores that sell fruit and vegetables, excluding the few large supermarkets and chain stores. Their aim was to map approximately 2,400 stores. Using larger streets as natural boundaries, these neighborhoods were then divided into 69 blocks, with a median block size of 36 retail shops per block. Six of these blocks were then dropped for safety reasons, leaving 63 blocks. Blocks were formed into matched pairs on the basis of geographic location and number of firms in the block, and then ordered according to the sequence in which Agruppa desired to expand operations. One block within each pair was then randomly assigned to treatment, and the other to control, for a total of 32 treatment blocks and 31 control blocks.
This yielded a sample of 1,620 firms, comprising 852 firms in treatment blocks and 768 firms in control blocks. On average, 69 percent of firms in treatment blocks and 70 percent of firms in control blocks expressed interest in Agruppa, giving us samples of 586 interested firms in treatment blocks, 266 uninterested firms in treatment blocks, 536 interested firms in control blocks, and 232 uninterested firms in control blocks.
IPA Colombia conducted five rounds of high-frequency short-term follow-up surveys at 2, 4, 6, 10, and 14 weeks after the launch of Agruppa in a block. We would survey a treatment block and its corresponding control block in the same week, staggering the timing to match the staggered timing of the baseline surveys and introduction of Agruppa.
The response rate averaged 79% for firms interested in Agruppa (81% in treatment blocks, 77% in control blocks), and 69% for not-interested firms (70% in treatment blocks, 68% in control blocks).
We then collected two longer surveys at six-months and twelve months after the launch of Agruppa in a block. In addition to the information collected in the high-frequency surveys, these questionnaires also asked about business opening hours, sales of some other products, pricing strategies, crime, record-keeping, and work-life balance. The response rates for interested firms were 78% at six months (80% in treatment blocks, 75% in control blocks), and 76% at twelve months (77% in treatment blocks, and 74% in control blocks), and were again lower for uninterested firms
Dates of Data Collection
Data Collection Mode
Computer Assisted Personal Interview [capi]
Innovations for Poverty Action Colombia
The Baseline and Follow-Up survey quetionnaires are published in Spanish and English, and provided under the Documentation tab.
Public Access allowed for research purposes only
Use of the dataset must be acknowledged using a citation which would include:
- the Identification of the Primary Investigator
- the title of the survey (including country, acronym and year of implementation)
- the survey reference number
- the source and date of download
Iacovone, Leonardo and David McKenzie "Shortening Supply Chains: Experimental Evidence from Fruit and Vegetable Vendors in Bogota", Research Paper. Ref. COL_2016-2018_IPMC_v01_M. Downloaded from [url] on [date].
Disclaimer and copyrights
The user of the data acknowledges that the original collector of the data, the authorized distributor of the data, and the relevant funding agency bear no responsibility for use of the data or for interpretations or inferences based upon such uses.