Impact of COVID-19 on The Bullwhip Effect Across U.S. Industries

TL;DR

This paper investigates how the COVID-19 pandemic intensified the Bullwhip Effect in U.S. industries, revealing industry-specific responses and emphasizing the importance of tailored supply chain strategies during global disruptions.

Contribution

It provides empirical evidence on COVID-19's impact on the Bullwhip Effect across multiple industries and highlights the role of supply chain structures in mitigating or amplifying this phenomenon.

Findings

COVID-19 significantly increased demand variability amplification.

Industry responses to shocks varied based on supply chain structure.

Tailored strategies are essential for managing supply chains during crises.

Abstract

The Bullwhip Effect, describing the amplification of demand variability up the supply chain, poses significant challenges in Supply Chain Management. This study examines how the COVID-19 pandemic intensified the Bullwhip Effect across U.S. industries, using extensive industry-level data. By focusing on the manufacturing, retailer, and wholesaler sectors, the research explores how external shocks exacerbate this phenomenon. Employing both traditional and advanced empirical techniques, the analysis reveals that COVID-19 significantly amplified the Bullwhip Effect, with industries displaying varied responses to the same external shock. These differences suggest that supply chain structures play a critical role in either mitigating or intensifying the effect. By analyzing the dynamics during the pandemic, this study provides valuable insights into managing supply chains under global disruptions and highlights the importance of tailoring strategies to industry-specific characteristics.