Small changes in consumer demand can result in large variations in orders placed because of the ...

Question

Quizplus · Accepted Answer

The bullwhip effect refers to the phenomenon of small changes in consumer demand resulting in large variations in orders placed, which ripple up the supply chain. It happens due to the lack of coordination and communication between different stages of the supply chain, such as manufacturers, distributors, and retailers. Therefore, the bullwhip effect best explains this situation.

Small Changes in Consumer Demand Can Result in Large Variations