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NEW QUESTION 30
A garden centre has recently purchased some lollypop sticks to use as plant labels. The staff have written the name of the plant on the lollypop stick and put it next to the plant. This helps them identify which plant is which. However, after a couple of weeks, the lollypop sticks have become mouldy and the writing has faded. Staff are now struggling to identity their plants. The Manager of the garden centre is considering returning the lollypop sticks and asking for a full refund as they were not fit for purpose. Can the Manager do this?
- A. No- as this was not the lollypop sticks intended purpose
- B. Yes- the lollypop sticks have gone mouldy- this is unacceptable
- C. No- the manager cannot prove that the product is faulty
- D. Yes- so long as the manager kept the receipt
Answer: A
Explanation:
The correct answer is 'no- as this was not the lollypop sticks intended purpose'. When deciding if something is fit for purpose, you must consider its intended and common purpose. In this case it would be for making lollypops. As the garden centre is using them for something other than their intended purpose, they can't complain if it doesn't work. Fit for purpose is discussed on p.65 p.s. there's a Question: like this in the real exam - it's just not lollypop sticks ; )
NEW QUESTION 31
Robbie is a procurement manager at a public sector organisation. He is running a tender which is worth £2m and so will advertise this on OJEU. His manager has reminded Robbie to include CPV codes on the tender. What purpose would this serve?
- A. To ensure suppliers know the deadline for tender submission
- B. To ensure more suppliers bid for the tender
- C. To ensure only qualified suppliers bid for the tender
- D. To ensure suppliers can find the opportunity
Answer: D
Explanation:
CPV codes help suppliers find opportunities they can bid for. CPV codes are a numerical classification for products e.g. Strawberry Jam is 15332296 and when they are included on a Tender, any supplier who is registered with that same CPV code will get a notification that the tender is live. CPV codes are discussed on p.72 but not in much detail- so don't worry if you don't know much about them. So long as you know the above, you'll be fine.
NEW QUESTION 32
A competitive advantage can be gained by doing what?
- A. Building better relationships with primary stakeholders
- B. Completing formal tenders for all buying requirements
- C. Engaging in market research
- D. Increasing your prices
Answer: A
Explanation:
The correct answer is 'Building better relationships with primary stakeholders'. This is a direct quote from the start of chapter 2.2: 'building better relationships with primary stakeholders such as employees, customers, suppliers and communities could lead to increased shareholder wealth by developing a competitive advantage'. The other three options wouldn't give you a competitive advantage; increasing prices would do the opposite, engaging in market research won't give you a competitive advantage unless you do something with that research such as implement a change to your business, and completing formal tenders for everything would be a waste of time and resources- there's no need to tender for low value, low risk items. See p.80
NEW QUESTION 33
Gabriel is a procurement manager who wishes to explore a new avenue to procure products for his company. His manager has told him that he should invite internal stakeholders to a meeting to get their feedback. Who should Gabriel invite? Select THREE.
- A. suppliers
- B. legal department
- C. employees
- D. end-users
- E. customers
Answer: B,C,D
Explanation:
Internal stakeholders are those who work within the business so include the legal department, employees and end-users. End-users mean those people and departments who will be using the product or service. For example if Gabriel is procuring new software- an end-user would be anyone who would be using that software (whether they're employees, volunteers or agencies). CIPS outlines types of stakeholders on p.64
NEW QUESTION 34
Andrew runs a factory that makes cakes. Vanilla Extract is a vital ingredient in Andrew's cakes and this is a monopolistic market. Andrew has noticed recently that the quality of the supplier's product has reduced, and this has led to several complaints from customers. Andrew is considering entering into a Partnership with this supplier as he believes this will help increase the supplier's performance. Is this the correct thing to do?
- A. No- Andrew should outsource the vanilla extract.
- B. No- Andrew should use an alternative supplier
- C. Yes- partnership sourcing will improve sales figures
- D. Yes- partnership sourcing can improve performance which will ultimately satisfy the end customer
Answer: D
Explanation:
The correct answer is 'Yes- partnership sourcing can improve performance which will ultimately satisfy the end customer'. The important thing to note in this Question: is the word 'monopolistic'. This means that there are no alternative suppliers- so the 'no' options are wrong- there are no alternative suppliers and no opportunity to outsource. The other answer is incorrect as sales figures isn't Andrew's concern - it's the complaints and quality of the product. Improving performance to satisfy end customers is therefore his main driver for considering a Partnership. See p. 127 for more information on Drivers of Partnership Sourcing. This comes up a lot in the exam
NEW QUESTION 35
Polly Manufacturing is a company which manufactures bicycle parts. It has several factories around the country and is one of the leading suppliers of wheels, bells and pedals. Which of the following is Polly Manufacturing likely to outsource? Select TWO options.
- A. Manufacturing of all bicycle parts
- B. Facilities Management
- C. Manufacturing of bells only
- D. Cleaning
Answer: B,D
Explanation:
They could outsource cleaning and facilities management. These are auxiliary services. The manufacturing of bike parts is their 'core' business so they should retain this in-house
NEW QUESTION 36
Innovation is a key consideration when entering into a partnership. Is this statement true?
- A. Yes- innovation is the only reason to enter into a partnership
- B. Yes- joint innovation projects are often a strong motivation for entering into a partnership
- C. No- the key consideration when entering a partnership is cost reduction
- D. No- innovation is best achieved in a contractual relationship where KPIs can be monitored closely.
Answer: B
Explanation:
The correct answer is 'Yes- joint innovation projects are often a strong motivation for entering into a partnership'. The other options are simply not true statements. A lot of the questions on the 'Partnerships' chapters of the book are common-sense questions like this. It involves reading the Question: and using logic, rather that relying on your knowledge of procurement. If you found this Question: easy - that's a good sign for the exam.
NEW QUESTION 37
Which of the following are characteristics that differentiate between a partnership relationship and traditional contracting relationships? Select THREE.
- A. Lower costs
- B. No tender process
- C. No defined end period
- D. Early supplier involvement
- E. Supplier KPIs
Answer: B,C,D
Explanation:
The correct answers are; no tender process, early supplier involvement and no defined end-period. A partnership wouldn't automatically mean lower costs, and in a partnership the KPIs are usually a joint performance measurement rather than set to the supplier. For more information on the difference between partnerships and contractual relationships see p.124-5
NEW QUESTION 38
Which of the following would you use to qualify new suppliers? Select THREE.
- A. cost
- B. commitment
- C. collection
- D. clean
- E. call
Answer: A,B,D
Explanation:
This is based on a real exam question- it's looking to see if you can remember Carter's 10 Cs. These are; cash, cost, consistency, culture, clean, communication, competency, capacity, commitment and control. (p.12 in the text book)
NEW QUESTION 39
Which of the following documents can be used at the selection stage of a tender process to ensure that short listed bidders meet the requirements of the buying organisation? Select TWO.
- A. Pre-Qualification Questionnaire
- B. Request for Quotation
- C. Request for Information
- D. Invitation to Tender
Answer: A,C
Explanation:
Request for Information and Pre-Qualification Questionnaire can be used for short-listing suppliers. Request for Quotation is used when the only variable is price and you would like suppliers to submit a price for you. Invitation to Tender would be the next stage after RFI / PPQ- this is sent out to those suppliers who have passed selection, and details the second stage of the competition. See p.75 for more details.
NEW QUESTION 40
Kinky Boots Ltd provides high heeled shoes in large sizes. Their target market are Drag Queens. There are a couple of rival shoe manufacturers in this market and Kinky Boots Ltd offer the cheapest high heels. What strategy is Kinky Boots Ltd employing in terms of competitive advantage?
- A. differentiation
- B. cost leadership
- C. cost focus
- D. differentiation focus
Answer: C
Explanation:
This is 'cost focus' - Kinky Boots is both focusing on being a cost leaser (by providing the cheapest products) and focusing on a niche market (drag queens). When these two strategies are combined it is called 'cost focus'. There's a couple of questions on Porter's Generic Strategies in the exam- there's a useful diagram of this on P.13
NEW QUESTION 41
What is collaborative inertia?
- A. A situation when the apparent output from collaboration is considerably less than expected
- B. Where a third party is invited to join a partnership.
- C. the concept that the value and performance of two companies combined will be greater than the sum of the separate individual parts
- D. When a partnership is unable to create new ideas
Answer: A
Explanation:
The correct answer is 'A situation when the apparent output from collaboration is considerably less than expected'. This is verbatim the definition given in the study guide on p.166 A synergy is the concept that the value and performance of two companies combined will be greater than the sum of the separate individual parts.
NEW QUESTION 42
What is a disadvantage of including qualitative KPIs into a contract?
- A. They pull focus from the more important quantitative KPIs
- B. They make the buyer seem weak
- C. They can lead to poor supplier performance
- D. They are hard to measure
Answer: D
Explanation:
The correct answer is 'They are hard to measure' p.103
NEW QUESTION 43
Varying levels of commitment is one reason why many partnerships fail. Why is this?
- A. Sufficient time and resources are put in
- B. Less profit is made.
- C. One party doesn't fulfil their KPIs
- D. It can lead to a lack of trust
Answer: D
Explanation:
The correct answer is 'It can lead to a lack of trust' - this is a quote from p.162. The other answers are all incorrect; in a partnership KPIs are joint between the parties- so there wouldn't be a situation where one party doesn't fulfil their KPIs. Commitment doesn't necessarily have a direct correlation with profit so that answer is incorrect. 'Sufficient time and resources are put in' is a positive thing, so can't be a reason who a partnership fails.
NEW QUESTION 44
Which of the following are Intellectual Property Rights that you would you encounter in procurement and supply contracts? Select THREE.
- A. Risk Assessments
- B. Patents
- C. Trademark
- D. Method Statements
- E. Copywrite
Answer: B,C,E
Explanation:
Intellectual Property Rights include; Patents, Copywrite, Trademarks and Trade Secrets. P.114
NEW QUESTION 45
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