Chapter 5 Terms

Bullwhip Effect

A phenomenon where small fluctuations in demand at the retail level cause increasingly larger fluctuations in demand at the wholesale, distributor, manufacturer, and raw material supplier levels.

Core Competency

A defining capability or advantage that distinguishes an organization in the marketplace and enhances its competitive edge.

Disintermediation

The process of removing intermediaries or middlemen from supply chains or distribution channels, often made possible by digital technologies.

Vertical integration

A company owns multiple stages of its supply chain, from raw materials to final product delivery, reducing reliance on outside suppliers and increasing control over quality, costs, and timing.

Point-of-Sale system (POS)

A technology used at retail locations to manage sales transactions and track inventory.

RFID

A technology that uses radio waves to automatically identify and track tags attached to objects, improving inventory management and supply chain efficiency.

Logistics

Coordinating and enabling the flow of goods, people, information, and other resources among locations.

Omnichannel

An approach to retail that offers consumers an integrated and complementary set of shop, sales, and return experiences (e.g., retail store, online, and sometimes even phone and catalog).

Distributor

A business or entity that purchases products from manufacturers or wholesalers and sells them to retailers or directly to consumers, helping to facilitate the supply chain.