As described in my earlier post, many supermarkets around the world experienced shortages of toilet paper due to the Covid-19 induced bullwhip effect. Now, we witnessed the second phase of this phenomenon. As consumers increased the safety stock levels of toilet paper in their homes in order to prevent stockouts – resulting in stockouts on the supermarket shelves – they purchased a lower quantity in the last week.

In the last weeks, toilet paper was short in many supermarkets due to Covid-19. This is a nice example of the dynamics in supply chains, where a small change might lead to tremendous fluctuations of demand and supply.