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NEW QUESTION # 40
Which of the following are considered 'wastes' which can be removed from a business? Select THREE.

• A. Over-processing
• B. Inventory
• C. Stockout
• D. Equity
• E. Transportation

Answer: A,B,E

Explanation:
The seven wastes (as defined by Taiichi Ohno) can be remembered as Tim Wood; transportation, inventory, motion, waiting, over-processing, over-production, defects. Some people add an S onto the end of Tim Wood to make Tim Woods (the s is for skills). In some modules of CIPS, they refer to 8 wastes and include skills, but in M6 they've only put the 7 on p.70.

NEW QUESTION # 41
What is the correct order for the 5 stages of team development?

• A. Storming, norming, adjourning, performing, forming
• B. Norming, adjourning, storming, performing, forming
• C. Forming, storming, norming, performing, adjourning
• D. Forming, storming, performing, adjourning, norming

Answer: C

Explanation:
Comprehensive and Detailed Explanation:
Bruce Tuckman's model of team development outlines five stages:
* Forming- Team members get acquainted and establish ground rules.
* Storming- Members begin to communicate their feelings but still view themselves as individuals rather than part of the team.
* Norming- People feel part of the team and realize that they can achieve work if they accept other viewpoints.
* Performing- The team works in an open and trusting atmosphere where flexibility is the key and hierarchy is of little importance.
* Adjourning- The team conducts an assessment of the year and implements a plan for transitioning roles and recognizing members' contributions.
Reference:
CIPS L4M6 Study Guide

NEW QUESTION # 42
The Queen Victoria is a traditional British pub which serves a range of alcoholic beverages. It has a partnership relationship with a local brewery which supplies several types of beer and cider. Logistics is a key concern for the Queen Victoria as deliveries must be made when there is room in the cellar to store the barrels of beer and cider. In what ways could the logistics risk be reduced?

• A. Batch ordering
• B. Using several suppliers instead of one
• C. Issuing POs electronically.
• D. Sharing up-to-date information

Answer: D

Explanation:
The logistics risk can be reduced by 'Sharing up-to-date information'. If the Pub tells the supplier when it's running low, they can then time the deliveries more accurately.
P. 136. A lot of the questions on the
'Partnerships' chapters of the book are common-sense questions like this. It involves reading thequestion and using logic, rather than relying on your knowledge of procurement. If you found this question easy - that's a good sign for the exam.

NEW QUESTION # 43
Which of the following behaviours are you likely to see in a Partnership relationship?

• A. Secrecy and honest communication
• B. Opportunistic behaviour and strong levels of trust
• C. Honest communication and opportunistic behaviour
• D. Strong levels of trust and honest communication

Answer: D

Explanation:
The correct answer is 'Strong levels of trust and honest communication'. The questions on Partnership in the exam tend to be quite straightforward, but if you're struggling with this see p. 148 for further details of behaviour in Partnerships.

NEW QUESTION # 44
Which of the following is an advantage for the suppler of entering into a partnership with a buyer?

• A. The Intellectual Property Rights of the buyer become yours
• B. They may gain an increased volume of business
• C. They no longer have to try as hard to win business.
• D. There is more flexibility when selling the product

Answer: B

Explanation:
The correct answer is 'They may gain an increased volume of business'. The other options are just not true. See p.130 for advantages and disadvantages of partnerships from both the buyer and supplier's perspective. This is a hot topic for the exam.

NEW QUESTION # 45
Which of the following are advantages for the buyer of entering into a partnership? Select TWO.

• A. The supplier may become complacent
• B. They are likely to be able to gain price stability
• C. They will gain an increased volume of business
• D. There may be greater continuity of supply

Answer: B,D

Explanation:
The correct answers are; They are likely to be able to gain price stability and There may be greater continuity of supply. The other options are an advantage for the supplier rather than the buyer (They will gain an increased volume of business) and a disadvantage of entering into a partnership (The supplier may become complacent). As you may have guessed from these questions - Partnerships come up a LOT in the exam. See p.130 for info on pros and cons of partnerships.

NEW QUESTION # 46
In a monopoly market, which of the following statements is true?

• A. bargaining power of suppliers is strong
• B. bargaining power of buyers is strong
• C. There is a threat of new entrants
• D. There is strong rivalry

Answer: A

Explanation:
In a monopoly there is only one supplier- therefore their power is strong. Buyers in this market are price takers and their power is weak. There is generally a strong barrier to entry into a monopoly market so the threat of new entrants is low. There is no rivalry. There are many questions in the exam on Porter's 5 Forces - see p. 39

NEW QUESTION # 47
Partnership relationships are long-term relationships without a defined end period. Is this statement TRUE?

• A. Yes-partnerships do not have end dates because they involve significant investment
• B. No- partnerships have end dates as they are contractual relationships
• C. Yes- partnerships do not have end dates because there is never a contract involved
• D. No- partnerships should have end dates so both parties have a way out if things don't work out

Answer: A

Explanation:
The correct answer is 'Yes-partnerships do not have end dates because they involve significant investment'. This is explained on p.126. Partnerships can involve contracts - so the other 'yes' answer is incorrect.

NEW QUESTION # 48
A partnership approach to a buyer-supplier relationship, as opposed to a traditional adversarial approach, would have which of the following characteristics?

• A. Specifications designed by the buyer
• B. Increased supplier contractual terms
• C. Shared cost benefits
• D. Greater levels of transparency

Answer: C,D

Explanation:
Partnerships are built on trust and transparency, with shared benefits such as cost reductions and improved processes. Adversarial relationships, in contrast, focus on price and contractual obligations.

NEW QUESTION # 49
Partnership sourcing is often considered a 'high-risk' strategy for a buyer. Which of the following is not a risk generally associated with partnership sourcing?

• A. Sharing commercially sensitive data with another party
• B. Single-sourcing may leave the buyer without a supply if the supplier goes into liquidation
• C. Supplier may become complacent
• D. Reduced waste in the supply chain

Answer: D

Explanation:
The correct answer is 'Reduced waste in the supply chain' - this is not a risk, this is a benefit P.134

NEW QUESTION # 50
When using competitive forces theory, suppliers are powerful in which of the following situations? Select THREE that apply.

• A. There is potential for backward integration
• B. The volume purchased is not important
• C. The product is undifferentiated
• D. The switching costs are high
• E. The product is highly differentiated
• F. There are few substitute products

Answer: D,E,F

Explanation:
Suppliers gain power when their products have limited substitutes, are highly differentiated, or when switching costs are high. These factors reduce buyer leverage and increase supplier influence, as described in Porter's Five Forces model.

NEW QUESTION # 51
In the public sector, there are many sources of information that a buyer can use to identify a suitable supplier. Which of the following could be used? Select THREE

• A. OJEU
• B. Internal stakeholders' knowledge
• C. Intranet
• D. Procurement Platforms
• E. Tradeshows

Answer: B,D,E

Explanation:
The correct answers are; tradeshows, internal stakeholders' knowledge and e-procurement platforms. Intranet is incorrect as this is an internal system so you wouldn't find information on external suppliers on here the careful not to confuse intranet with internet). OJEU is also incorrect; this is the platform on which tender opportunities in the public sector are published- its not a list of suppliers.

NEW QUESTION # 52
Debbie is a procurement manager at a small manufacturer company. She had a contract in place with a company that provides uniforms, but finds that she doesn't need to order much from them as the staff re-wear the same clothes to work. The contract has now expired. Should Debbie do a Competitive Tender to source a new contract?

• A. No- the contract is not of significant value
• B. Yes- competitive tender is the only option to procure uniforms
• C. No- Debbie should continue using the same supplier- it doesn't matter that the contract has expired.
• D. Yes - the contract has now expired so she must do a new competitive tender

Answer: A

Explanation:
The correct answer is 'no-the contract is not of significant value'. CIPS state that competitive tenders should only be used when 'the item or service is of significant value' p.73. Debbie could continue using the same supplier, but she should organise a contract extension or a new contract if she does.

NEW QUESTION # 53
Which of the following are typical drivers for a partnership between the buyer and the supplier? Select the THREE that apply.

• A. The product is technically complex
• B. There are many suppliers in the market
• C. The product is critical for the buyer
• D. The product is a commodity
• E. The supplier provides the product to a buyer's competitor
• F. The buyer has a high spend with the supplier

Answer: A,C,F

Explanation:
Comprehensive and Detailed Explanation:
Partnerships between buyers and suppliers are often driven by:
* High Spend:Significant expenditure justifies the investment in developing a closer relationship to achieve cost savings and efficiencies.
* Critical Products:Items that are essential to the buyer's operations necessitate a reliable and collaborative supplier relationship.
* Technical Complexity:Complex products benefit from joint development efforts, shared expertise, and coordinated problem-solving.
Conversely, commodities and markets with many suppliers typically lend themselves to transactional relationships rather than partnerships.
Reference:
CIPS L4M6 Study Guide

NEW QUESTION # 54
Beyond Say is a manufacturer of diamond rings. It sources a lot of different parts to create its products including diamonds, gold, cardboard boxes for the rings to go in, as well as stationary and copier paper for the offices. Although it doesn't buy many diamonds, these represent a large part of Beyond Say's spend. Which category of spend would diamonds represent?

• A. Option
• B. It isn't possible to tell
• C. Option
• D. Option

Answer: A

Explanation:
This is category 'A' spend in the ABC model - they represent a large value and a small number of purchases / suppliers. See p.17 for more information on the ABC Analysis

NEW QUESTION # 55
A restricted market is a market where there are only a small number of capable and competent suppliers.
Which of the following is not a reason for a marketplace to be restricted?

• A. The product is easy to source elsewhere
• B. Strong governmental regulation
• C. High barriers to entry
• D. Low levels of profitability

Answer: A

Explanation:
The correct answer is 'The product is easy to source elsewhere'. The other three are given as reasons a marketplace might be restricted on p.138. Other reasons also include; brand loyalty, difficult access to distribution channels, and companies colluding.

NEW QUESTION # 56
Which of the following options are legitimate reasons for terminating a contract? Select TWO that apply.

• A. You ordered 10,000 items instead of 1,000
• B. Your internal stakeholder requested the wrong items
• C. Your MRP system placed a replenishment order that you do not need
• D. One of the contracted parties has clearly failed to perform its duties
• E. There has been a serious breach of contract terms

Answer: D,E

Explanation:
Legitimate reasons for contract termination under CIPS guidelines include failure to perform duties and serious breaches of contract terms. Ordering errors or changes in stakeholder needs are not valid termination grounds unless explicitly stated in the contract. This protects both parties from unjustified termination risks.

NEW QUESTION # 57
When outsourcing, which legislation details the rights of employees who may find themselves now working for the outsourcing company?

• A. PCR 2015
• B. OJEU
• C. ITT
• D. TUPE

Answer: D

Explanation:
The correct answer is TUPE: Transfer of Undertakings (Protection of Employment). Details on TUPE can be found on p.115

NEW QUESTION # 58
A low-cost fashion retailer based in Europe is looking at adding value in their procurement activities. The retailer buys clothing for re-sale with a very small profit margin applied, relying on volume salesto make profit. Which of the following added-value approaches will be the most critical for the procurement team of the retailer to focus on with their supply chain?

• A. Improving timescales
• B. Quality enhancement
• C. Price management
• D. Reduction of inventory

Answer: C

Explanation:
For low-cost, high-volume business models, maintaining profitability depends on tightly controlled procurement costs. Price management is critical for ensuring competitive pricing while safeguarding slim margins. CIPS L4M6 highlights that effective cost management and price negotiation are essential in such scenarios.

NEW QUESTION # 59
Achieving value for money can often be described as the three Es? What are these?

• A. Ethics, Environment, Economy
• B. Economy, Efficiency, Environment
• C. Effectiveness, Efficiency, Economy
• D. Efficiency, Economy, Ethics

Answer: C

Explanation:
The three Es are; Effectiveness, Efficiency and Economy. Sometimes a 4th E is added which is Equity (but this is mainly for the public sector).

NEW QUESTION # 60
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