The%20Bullwhip%20Effect%20in%20Supply%20Chains

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The Bullwhip Effect in Supply Chains
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What is Bullwhip Effect ?

• Order variability in the supply chain were
  amplified as they moved up the supply chain.

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What is Bullwhip Effect ?
Customer
Retailers
Wholesalers
Suppliers
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Major Causes

• Demand forecast updating

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Solution

• Demand forecast updating
• Information Sharing EDI, POS
• Vendor-managed inventory (VMI)

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Major Causes

• Order Batching

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Solution

• Order Batching
• Delivery appointments
• Consolidation
• Outsourcing

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Major Causes

• Price fluctuation
• Rationing and shortage gaming

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Solution

• Price Fluctuation
• Continuous replenishment program (CRP)
• Everyday low price (EDLP)
• Shortage Gaming
• Allocation based on past sales

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Conclusion

• Bullwhip effects are products of rational
  decisions of supply chain members.
• Bullwhip effects can be effectively counteracted.
• The choice either let the bullwhip effect
  paralyze the company or find a way to conquer it.

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• Q A