Consider a simple supply chain consisting of a manufacturer, a distributor and retailers. Which member of...

Consider a simple supply chain consisting of a manufacturer, a distributor and retailers. Which member of the suply chain faces the highest level of fluctuating demand? Discuss the effective means for reducing the level of demand fluctuation.

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Expert Solution

Bullwhip is caused when there is slight fluctuations in the demands at customer end and it the variations gets carry forwarded significant with high variability creeping as the chain passes.

In the simple supply chain retailer is directly in contact with customer and in the first stage of bullwhip effect there is less variability the variability increases as the stages passes by. So there exists a high variability for the orders they distributors keep to manufacturers.

The following are effective means through which demand fluctuations can be controlled :

1. High degree of collaboration with customers and suppliers and should facilitate the uniform flow of information across all the channels from retailer to manufacturer.

2. Improve forecast accuracy.

3. Going with demand driven supply chain approach

4. Enable faster decisions with viability and approach which focuses on high level of transparency

I hope i could able to clear your doubts, do help with a like if you are satisfied with the answer

keosha answered 7 months ago

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