The inventory bullwhip effect in the online retail supply chain considering the price discount based on different forecasting methods

Abstract

With the improvement of the new generation information technology, and the development of online economy, the customer behavior has gradually changed. The online economy has gradually become a new economic growth point. Many online platforms attract customers to purchase new products through different kinds of price discounts. In this article, we discuss the inventory bullwhip effect (IBE) in an online retail supply chain (ORSC) considering the price discount based on the different forecasting methods. Moreover, we discuss the influence of them on the IBE. When the price discount, the moving average forecasting method (MA), the exponential smoothing forecasting method (ES), and the minimum mean squared error forecasting method (MMSE) are considered, we consider an ORSC including of a manufacturer and an online platform, and the quantitative models of the BE and the IBE are discussed. This article finds that when the price sensitivity coefficient is very low, the online platform’s IBE is the lowest when the online platform adopts the MMSE method. Moreover, when the price discount gradually increases, the IBE of the online platform is also increasing. Moreover, it is gradually increasing when the expectation price difference coefficient becomes gradually increasing.

Disclosure statement

The authors report there are no competing interests to declare.

Additional information

Funding

This article was supported by the Jiangsu University Natural Science Foundation Project (No. 22KJB630005), the Ministry of Education Chunhui Plan International Scientific Cooperation Research Project (No. HZKY20220132) and the Social Science Foundation in Jiangsu Province (No. 22GLC011).

Notes on contributors

Qiang Chen

Qiang Chen is a lecturer in Sino-Russian Institute, Jiangsu Normal University, Xuzhou, China. His research interest includes: Management, National Economic Management and Sustainable Development. His articles were published in Sustainability, Journal of Economics of Shanghai School, etc.

Xiaoqing Zhang

Xiaoqing Zhang is a lecturer in department of Logistics Management, School of Business, Jiangsu Normal University, Xuzhou, China. Her research interest includes: Supply Chain Management. Her article was published in European Journal of Industrial Engineering, Journal of Cleaner Production, Kybernetes, Information Technology Journal, Journal of Logistics and Technology.

Shuang Liu

Shuang Liu is an associate professor in department of Management, School of Business Administration, Hebei University of Economics and Business, Shijiazhuang, China. His research interest includes: Organizational Behavior and Human Resource Management.

Weixiao Zhu

Weixiao Zhu is a graduate student in the School of Business, Jiangsu Normal University, Xuzhou, China. Her research interests includes: Innovation Management, Supply Chain Management. Her articles was published in Science and Technology Research Management.