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L4M6 Practice Questions

Supplier Relationships

Last Update 10 hours ago
Total Questions : 263

Dive into our fully updated and stable L4M6 practice test platform, featuring all the latest CIPS Level 4 Diploma in Procurement and Supply exam questions added this week. Our preparation tool is more than just a CIPS study aid; it's a strategic advantage.

Our free CIPS Level 4 Diploma in Procurement and Supply practice questions crafted to reflect the domains and difficulty of the actual exam. The detailed rationales explain the 'why' behind each answer, reinforcing key concepts about L4M6. Use this test to pinpoint which areas you need to focus your study on.

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Question # 11

The purpose of supplier pre-qualification is to identify suppliers that have the financial stability to assist in continuous supply. Is this statement TRUE?

Options:

A.  

Yes, because profitability ratios are always used to determine the most suitable potential supplier

B.  

Yes, although the sustainability of supply should be determined by considering other factors

C.  

No, financial stability can be determined by accountants only

D.  

No, the most important aspect of determining supplier suitability is by trial orders

Discussion 0
Question # 12

Red Ltd and Blue Ltd have had a disagreement over a high value project they have been partnering on. They have been unable to resolve the issues inhouse and Red Ltd has suggested Mediation as an option. Is this a good option?

Options:

A.  

Yes- mediation involves a neutral third party and gets both parties to attempt to reach a compromise

B.  

Yes- mediation means the buyer and supplier agree to accept a third party’s decision which will solve the disagreement issues

C.  

No- it would be better to solve the disagreement in-house

D.  

No- mediation could have a negative impact on the companies’ reputation

Discussion 0
Question # 13

Which of the following would be the most likely driver for a manufacturing organisation to consider partnership sourcing?

Options:

A.  

The marketplace is stable and costs are decreasing

B.  

To increase the number of suppliers

C.  

Product life cycles are shortening

D.  

Raw material prices are reducing

Discussion 0
Question # 14

The Kraljic Model is most useful for which aspect of procurement?

Options:

A.  

category management

B.  

cost analysis

C.  

risk management

D.  

cost reduction

Discussion 0
Question # 15

In a monopoly market, which of the following statements is true?

Options:

A.  

bargaining power of suppliers is strong

B.  

bargaining power of buyers is strong

C.  

There is strong rivalry

D.  

There is a threat of new entrants

Discussion 0
Question # 16

Which of the following are value-added benefits? Select THREE that apply.

Options:

A.  

Free training for all staff

B.  

Storage of raw materials

C.  

Customer service hotline

D.  

Expert consulting services

E.  

Paperwork between departments

F.  

Quality control team

Discussion 0
Question # 17

Phone Maker Incorporated is a manufacturer of mobile phones. It is considering investing in a partnership with its supplier of batteries and circuit boards as it wishes to produce new models of its phone more regularly. What is the main driver for Phone Maker Incorporated?

Options:

A.  

Cheaper costs

B.  

Changes in the marketplace

C.  

Better quality products

D.  

Reduced product life-cycles

Discussion 0
Question # 18

A partnership approach to a buyer-supplier relationship, as opposed to a traditional adversarial approach, would have which of the following characteristics?

Options:

A.  

Greater levels of transparency

B.  

Increased supplier contractual terms

C.  

Specifications designed by the buyer

D.  

Shared cost benefits

Discussion 0
Question # 19

Which of the following options are legitimate reasons for terminating a contract? Select TWO that apply.

Options:

A.  

You ordered 10,000 items instead of 1,000

B.  

One of the contracted parties has clearly failed to perform its duties

C.  

There has been a serious breach of contract terms

D.  

Your internal stakeholder requested the wrong items

E.  

Your MRP system placed a replenishment order that you do not need

Discussion 0
Question # 20

Which of the following relationship types are characterised by low levels of trust? Select TWO options

Options:

A.  

Adversarial(Correct)

B.  

Arm's Length

C.  

Outsourced

D.  

Single- Sourced

E.  

Partnership

Discussion 0
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