Controlling the bullwhip with transport capacity constraints
by Jouni Juntunen, Jari Juga
International Journal of Services and Standards (IJSS), Vol. 5, No. 2, 2009

Abstract: The bullwhip effect can be costly to companies in terms of capacity-on costs and stock-out costs. This paper examines the possibilities for controlling the bullwhip effect with transport capacity management in the supply chain. The goal is to examine how inventories and service levels react to transport capacity constraints in a simulated supply chain that is prone to the bullwhip effect. By controlling the transport capacities, the companies may be able to reduce the impacts of demand amplification and inventory variations. Thus, there may be significant practical implications of the findings for logistics managers in today's volatile business environments.

Online publication date: Fri, 17-Jul-2009

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