Quantifying the Bullwhip Effect in the Supply Chain of Small-Sized Companies

This research addressed the Bullwhip Effect (BWE) in the supply chain of small companies and quantified the impact of the interaction between demand management strategies and forecasting methods on BWE. Experiments were performed with four management strategies and three forecasting techniques for different levels of seasonality, lead times, and order batching. Results indicate that no demand management strategy dominates under all conditions. Collaborative strategies are best under low seasonality. Higher levels of communication result in different levels of improvement depending on demand seasonality. Stochastic lead times do not exacerbate BWE when the items are batched. A quantification methodology is proposed.