Study of the Bullwhip Effect under Various Forecasting Methods in Electronics Supply Chain with Dual Retailers considering Market Share

We establish in this paper a new two-stage supply chainwith onemanufacturer and two retailers which have a fixedmarket share in themature and stable market with specific reference to consumer electronics industry. This paper offers insights into how the three forecasting methods affect the bullwhip effect considering the market share under the ARMA(1, 1) demand process and the orderup- to inventory policy. We also discuss the stability of the order with the theory of entropy. In particular, we derive the expressions of bullwhip effectmeasure under the MMSE, MA, and ES methods and compare them by numerical simulations. Results show that the MA is always better in contrast to the ES for reducing the bullwhip effect in our supply chain model. When moving average coefficient is lower than a certain value, the MMSE method is the best for reducing the bullwhip effect; otherwise, theMA method is the best. Moreover, the larger the market share of the retailer with a long lead time is, the greater the bullwhip effect is, no matter what the forecasting method is.