The Bullwhip Effect is a term in economics, which refers to a phenomenon of demand variation amplification in the supply chain. It is when the information flow is transmitted from the final client to the original supplier. , cannot effectively realize the sharing of information, causing the information to be distorted and amplified step by step, resulting in greater and greater fluctuations in demand information. The amplification effect of this information distortion is graphically very similar to a bullwhip. , so it is vividly called the bullwhip effect. The upstream supply side can be compared to the tip, and the downstream users can be compared to the root. Once the root shakes, large fluctuations will occur when it is transmitted to the tip.

The phenomenon of demand variation amplification in the marketing process is colloquially known as the "bullwhip effect." It is a common high-risk phenomenon in marketing. It is the result of the game between sellers and suppliers in the aspects of demand forecast revision, order quantity decision-making, price fluctuation, shortage game, inventory responsibility imbalance and coping with environmental variability. It increases supply. manufacturers’ production, supply, inventory management and marketing instability. Enterprises can avoid or resolve the impact of demand amplification and variation from six aspects: ordering hierarchical management; strengthening warehousing management and reasonably sharing inventory responsibilities; shortening lead times and implementing outsourcing services; avoiding gaming behavior in shortage situations; referring to historical data, Make appropriate reductions and corrections and send them in batches; advance the payment deadline.

The "bullwhip effect" is a common high-risk phenomenon in marketing activities. It directly aggravates the supplier's supply and inventory risks, and even disrupts the manufacturer's planning arrangements and marketing management order, leading to production failures. , supply, and marketing chaos, solving the "bullwhip effect" problem is a necessary prerequisite for the company's normal marketing management and good customer service.