Bullwhip Effect Analysis in Two-Level Supply Chain Distribution Network Using Different Demand Forecasting Technology

Xi Gang Yuan and Nan Zhu ()
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Xi Gang Yuan: The School of Statistics, Southwestern University of Finance and Economics, Chengdu 611130, P. R. China
Nan Zhu: The School of Statistics, Southwestern University of Finance and Economics, Chengdu 611130, P. R. China

Asia-Pacific Journal of Operational Research (APJOR), 2016, vol. 33, issue 03, 1-23

Abstract: Following the basic work conducted by Lee et al. [(1997a), The bullwhip effect in supply chains. Sloan Management Review, 38(3), 93–102; (1997b), Information distribution in a supply chain: The bullwhip effect. Management Science, 43(4), 546–558] and using two first-order autoregressive AR(1) models, respectively, this paper provides three quantitative models of the bullwhip effect of the two-level supply chain distribution network consisting of a single manufacturer and two retailers. The paper assumes that two retailers adopt the order point method, uses three kinds of demand forecasting technology, i.e., moving average, exponential smoothing and minimum mean square error methods, respectively, provides three corresponding models for analyzing the impact of bullwhip effect of two-level supply chain distribution network. At the same time, this paper compares and analyzes the results of the three models through simulation.

Keywords: Two-Level supply chain distribution network; bullwhip effect; forecast technology (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1142/S0217595916500160

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