ACHR warns industry of “Bullwhip Effect”

Will Canadian HVACR players feel the sting of the “Bullwhip effect”? A recent article from ACHR News suggests the sector could witness a sudden shift in stock and prices due to this disruptive supply chain phenomenon.

“To understand the Bullwhip Effect, recall the Indiana Jones movies,” suggests author Matt Michel, CEO of Service Roundtable, “Jones would make a small flick of his wrist holding the bullwhip, and the variation of the whip would increase as it moved towards the tip. Just as the whip moves up and down across its length, so the inventory in a supply chain can range from overstocked to empty shelves.”

The article dives into the origins of the term within (of all places) the diaper business, and how temporary jumps in demand can lead to overcorrections throughout the supply chain. Read what this means for manufacturers and contractors in Beware the Bullwhip Effect in Residential HVAC.

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