Supply Chain Management Cheat Sheet 2026

The 30 highest-yield Supply Chain Management facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. What is the primary security concern when supply chain companies adopt IoT sensors connected to the internet across multiple facilities? → Each connected device is a potential entry point for cyberattacks if not properly secured
2. Which inventory replenishment strategy triggers an order only when stock falls to a predetermined reorder point? → Continuous review system
3. In a warehouse context, what is 'shrinkage'? → Inventory loss due to theft, damage, administrative errors, or spoilage
4. Which metric is most useful for evaluating program effectiveness in Supply Chain Management? → Outcome-based performance indicators
5. What is a key risk of relying heavily on offshore suppliers in procurement? → Longer lead times and potential supply disruptions from distance and geopolitical factors
6. A 'milk run' transportation strategy is best described as: → A single vehicle making sequential stops to pick up from multiple suppliers
7. A carrier's freight rate decreases per unit as shipment weight increases. This pricing structure is called: → Tapering rate structure
8. Which of the subsequent is not a justification for maintaining inventory? → To make the system less productive
9. What is the primary purpose of a Transportation Management System (TMS)? → Planning, executing, and optimizing the movement of goods
10. The definition of productivity is? → output/input
11. In supply chain risk management, what is 'supply base rationalization'? → Deliberately reducing the number of suppliers to simplify management and increase leverage
12. What does the term 'dwell time' refer to in freight logistics? → Time cargo sits idle at a port or terminal
13. The postponement strategy in distribution involves: → Delaying product customization or final assembly until closer to customer demand is known
14. What is the most effective approach to demand planning in the Supply Chain Management field? → Systematic planning and continuous improvement
15. Which inventory control method requires counting a small subset of inventory items each day on a rotating basis? → Cycle counting
16. What is 'incoming quality control' (IQC) primarily designed to do? → Verify purchased materials meet specifications before entering production
17. A company reduces its supplier base from 50 vendors to 10 strategic partners. This is an example of: → Supplier rationalization
18. A supplier scorecard shows a supplier scoring 95% on quality but only 72% on on-time delivery. What should the buyer do FIRST? → Conduct a root cause discussion with the supplier focused on the delivery gap
19. In the context of supply chain transportation, what does 'tender acceptance rate' measure? → The percentage of freight tenders that carriers accept
20. A company identifies that a new trade tariff will increase import costs by 25%. Which risk response is most appropriate? → Evaluate nearshoring, tariff engineering, or alternative sourcing options
21. Which professional attribute is most valued in quality control within the Supply Chain Management field? → Accountability and commitment to standards
22. A company sources a critical component from a single supplier in a politically unstable region. This represents which type of supply chain risk? → Geopolitical risk
23. What is the main advantage of a hub-and-spoke distribution network compared to a point-to-point network? → Reduced total routes and consolidated freight volumes, lowering per-unit cost
24. Which metric is most useful for evaluating program effectiveness in Supply Chain Management? → Outcome-based performance indicators
25. Which inventory costing method assumes that the most recently purchased items are sold first? → LIFO
26. What is the key operational principle behind a 'pull' production system? → Production is triggered only by actual customer demand or consumption signals
27. What role does collaboration play in warehousing for Supply Chain Management professionals? → It enhances outcomes through diverse perspectives and shared expertise
28. In supply chain logistics, what is the bullwhip effect? → Demand fluctuations that amplify upstream in the supply chain
29. Which of the following is not a value-added service classification? → Quality
30. A company ships goods under Incoterms 2020 'DAP' (Delivered at Place). Who bears the cost and risk of import customs clearance? → The buyer