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Demand Amplification
Supply Chain

Demand Amplification

Increase in demand variability as signals move upstream through a supply chain; closely related to the bullwhip effect.

Examples

  1. 01Demand amplification makes a stable retail demand of 1,000 units a week look like swings between 600 and 1,800 at the component supplier.
  2. 02The monthly supply review tracks demand amplification by comparing order variability at each level of the chain.
  3. 03Smaller, more frequent orders cut demand amplification, so suppliers can plan with less safety stock.

Related terms

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