Measuring the bullwhip effect for supply chains with seasonal demand components

• A two-stage supply chain with an order-up-to inventory policy is considered.
• A bullwhip measure for a general SARMA (p, q) × (P, Q)s demand process is derived.
• Can exploit link between lead-time and seasonal lag to reduce bullwhipe effect.

A bullwhip measure for a two-stage supply chain with an order-up-to inventory policy is derived for a general, stationary SARMA(p, q) × (P, Q)s demand process. Explicit expressions for several SARMA models are obtained to illustrate the key relationship between lead-time and seasonal lag. It is found that the bullwhip effect can be reduced considerably by shortening the lead-time in relation to the seasonal lag value.