Question 1
1.1 Demand forecast updating
- Selected forecasting method and processing method of demand signal will greatly contribute to bullwhip effect. It is important to select the best prediction method for various kinds of products.
Order batching
- Companies do not place orders on suppliers daily. In order to take advantage of the economies of scale, orders must be combined or batched to improve efficiency and reduce costs.
Price fluctuation
- Due to frequent price fluctuations and promotions, companies will purchase in large quantities at specific times. At this time, retailers and wholesalers purchase more than necessary to use better prices, and inventory is kept until needed.
Rationing and Shortage gaming
- It occurs in an environment where…show more content… Postponement strategies and practices are used to cut down on the anticipatory risk of supply chain performance.
Postponement as defined by Chopra and Meindl can be defined as the suspension of product differentiation until closer to the sale of the product.
2.2 The postponement strategy aims to delay the supply chain activities until the customer order is received
This will reduce the probability of incorrect production or erroneous inventory deployment. Deferral strategies and practices play a role in cutting the leading risks in the supply chain.
All activities prior to product differentiation require aggregate forecasts more accurately than individual product forecasts. Types of postponement: Purchasing postponement The purchase of expensive and fragile material is delayed. Manufacturing postponement
In this form of postponement goods are semi-finished and can be customized quickly in production facilities.
Logistics postponement
Products that are semi-finished can be customized quickly in facilities closer to customers.
Time
