Concept of the “bullwhip effect” in connection to push strategies

Bullwhip effect happens when a company makes abundance of products that it predicts the customers may need keeping in mind the orders they get through a supply chain. There exists a gap between the actual number of products the retailer predict the customers may buy and the number of produced products. For example the retailer may order 10 products while manufacturer produces 30 products.

Push strategies can help get customers buy more products from the retailer so that the bullwhip effect may be avoided.