The bullwhip effect is a phenomenon of demand variation and amplification in the supply chain. It means that when the information flow is transmitted from the final client to the original supplier, the sharing of information cannot be effectively realized, which makes the phenomenon of information distortion amplify step by step, leading to greater and greater fluctuations in demand information.
The bullwhip effect is when a new product is on the market and the supply exceeds demand, retailer A temporarily increases the order quantity to wholesaler B according to the sales of the product, and B places an order with the merchandise sales center according to the order quantity submitted by different retailers.