The bullwhip effect is the distortion of information about the demand for a product as it passes from one entity to the next across the supply chain.

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The bullwhip effect is a well-known phenomenon in supply chain management where small fluctuations in demand at the end of the supply chain can have a significant impact on upstream suppliers, resulting in an increase in variability as information is transmitted from one entity to the next. This can lead to overproduction or underproduction and can result in higher inventory costs, missed opportunities and lost revenues.

The Bullwhip Effect Is the Distortion of Information About the Demand