Surplus of producer and consumer.

Surplus is a situation in the market in which quantity supplied is at a higher level than quantity demanded. It is also called a situation of excess supply looking at it from the Producers and Consumers point of view.
 Imagine you going to a handicraft fair which is selling items at a much lower price from that of market and that too directly by the makers so there's no problem of authenticity. You buy a stole from there for only Rs. 200 whose market price is Rs. 500. So you make a clean profit of Rs. 300. In other words, you save Rs. 300 which otherwise would have been spent had you bought the stole from market. This is what consumer surplus is- the amount buyer is willing to pay for a good minus the amount buyer pays for it. That is the implicit gain a consumer makes. A lower price in the market raises consumer surplus.

Now there is another side to the handicraft story . The person who sells you this has actually taken Rs. 150 in total including the fabric, colour and other items to manufacture the stole. He sells that for Rs. 200. So he is having a profit a Rs. 50. This is the benefit he is getting by selling in the market, in this case, the fair. This is called producer surplus- difference between the price producer is willing to sell at and the price actually sold at. That is the profit producer makes. A higher price in market raises producer surplus.