4-Stage Supply ChainExternalDemandRetailerFIGURE5-5:ThesupplychainOrderleadtimeDelivery lead time?Sales quite flatWholesaler.Distributor orders fluctuateOrderleadtimeDeliveryleadtimemore than retail salesDistributor· Supplier orders fluctuateOrderleadtimeDeliveryleadtimeeven moreFactoryProduction leadtime6
4-Stage Supply Chain FIGURE 5-5: The supply chain • Sales quite flat • Distributor orders fluctuate more than retail sales • Supplier orders fluctuate even more 6
HigherVariabilityinOrdersPlacedbyRetailertoManufacturerThanActualSalesQuantity6050OrdersPlaced403020ActualSales101TimeLee, H, P. Padmanabhan and S. Wang.(1997), Sloan Management Review
Higher Variability in Orders Placed by Retailer to Manufacturer Than Actual Sales Lee, H, P. Padmanabhan and S. Wang (1997), Sloan Management Review 7