Supply Chain Management Procurement 2

Question 1

Which procurement strategy involves purchasing from a single supplier to leverage volume discounts and build a strong partnership?

Accepted Answer

Single sourcing

Answer

Single sourcing consolidates purchases with one supplier to gain volume discounts and foster deeper supplier relationships.

Question 2

What is the primary purpose of a Request for Proposal (RFP) in procurement?

Accepted Answer

To solicit detailed bids including technical and pricing information from vendors

Answer

An RFP invites suppliers to submit comprehensive proposals covering technical capabilities, approach, and pricing.

Question 3

In procurement, 'maverick spending' refers to:

Accepted Answer

Purchases made outside approved channels or contracts

Answer

Maverick spending occurs when employees bypass procurement processes and make unauthorized purchases outside established contracts.

Question 4

Which contract type places the greatest financial risk on the buyer?

Accepted Answer

Cost-plus contract

Answer

Cost-plus contracts reimburse the supplier for all costs plus a fee, giving suppliers little incentive to control costs and shifting risk to the buyer.

Question 5

What does 'supplier consolidation' aim to achieve in a procurement strategy?

Accepted Answer

Reduce the supplier base to improve relationships and leverage

Answer

Supplier consolidation reduces the number of suppliers to gain better pricing leverage, streamline management, and build stronger partnerships.

Supply Chain Management Practice Test

Supply Chain Management Practice Test

Supply Chain Management Procurement 2