Analyzing the Stability of Two-Echelon Supply Chain Systems

In allusion to the condition of adopting mostly (R,S) replenishment policy when analyzing the bullwhip effect based on inventory policies, replenishment policies and demand forecast policies and measuring the amplificatory extent with linear control theory, in this paper we apply transfer functions to study the stability of a two-echelon supply chain system that operates under the general Bowman linear replenishment, coming to the parameters´ ranges that ensure the stability of a supply chain system. The results provide the suppliers, distributors and retailers some methods to order products and decrease the order amplification.