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25 February, 07:01

Compare and contrast anticipatory and response-based business models. Why has responsiveness become popular in supply chain collaborations?

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  1. 25 February, 10:07
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    Forecast and planning

    Explanation:

    An anticipatory model is a model under which market forecast determines the production of products by the manufacturer, and purchases by retailers also determined by forecasts and promotional plans. Since the forecasts are wrong most of the times, anticipatory model usually leads to differences in the actual production of the firms and what they initially planned to produce.

    Anticipatory Model is a risky model because anticipation of future events always determines the work to do by the firm.

    On the contrary, the Responsive Business Model does not depend on forecasts, but ensure that what to be done are adequately planned and information among firms in the supply chain are properly exchanged. This makes the model not to be risky and ensure doing more than what has already been planned is avoided. Therefore, the aim of the responsive model which also known as Pull Model is to eliminate reliance on forecast.

    The major reason the Responsive Model has become popular in supply chain collaborations is that it allows for the customization of products on smaller orders by customers. However, the Anticipatory Model does not give customers any choice or power but to buy or not buy.
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