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質問 # 48
A competitor develops an alternative type of vacuum cleaner to one produced by your organization. Is this an example of the threat of substitutes, one of the five forces of competition described by competitive forces theory?
- A. Yes, customers may switch to alternative products
- B. Yes, there are no barriers to entry; it is an oligopoly
- C. No, it does not serve the same purpose
- D. No, it is a threat from a new entrant to the market
正解：A
解説：
Substitute products pose a competitive threat by offering alternative solutions to customers, potentially eroding market share. Effective differentiation and customer retention strategies are essential.
質問 # 49
A comprehensive approach to managing the termination of a contractual relationship would include ...
- A. Setting aside the value of existing work done by both parties
- B. Giving qualitative feedback only
- C. Setting remedies and compensation for contractual breaches
- D. Attacking the personalities, not the problem
正解：C
解説：
Effective termination includes remedies and compensation to address any contractual breaches, ensuring fairness and compliance with legal and ethical obligations.
質問 # 50
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. Tradeshows
- D. Procurement Platforms
- E. Intranet
正解：B、C、D
解説：
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.
質問 # 51
Cigarettes and alcohol are often described as having an 'inelastic price'. What does this mean?
- A. The product is subject to high rates of tax
- B. The product is subject to age restrictions
- C. Changes in price will not affect how much of the item is bought
- D. Changes in price will greatly affect how much of the item is bought
正解：C
解説：
A product with an 'inelastic price' means that consumption doesn't really depend on how much it costs. So you could increase the price of alcohol and cigarettes and people would tend to still buy them. A product with an elastic price means that a change in price would have a large affect on the number of people who bought the item. See p.95 for more details on price elasticity.
質問 # 52
Which of the following are primary activities, according to Porter's Value Chain? Select THREE.
- A. Marketing and Sales
- B. Inbound Logistics
- C. Operations
- D. Procurement
- E. Human Resources
正解：A、B、C
解説：
This question refers to Porter's Value Chain (p.35). There's a couple of questions on this in the exam so try to learn it.
Primary activities are; inbound logistics, operations, outbound logistics, marketing and sales, after sales- service
質問 # 53
Which of the following are typical drivers for a partnership between the buyer and the supplier? Select the THREE that apply.
- A. There are many suppliers in the market
- B. The supplier provides the product to a buyer's competitor
- C. The product is technically complex
- D. The product is a commodity
- E. The product is critical for the buyer
- F. The buyer has a high spend with the supplier
正解：C、E、F
解説：
Drivers for partnership include a high spend with the supplier, criticality of the product, and technical complexity. These factors encourage collaboration for cost efficiency, quality improvement, and risk management. Partnerships are less likely when there are many suppliers or the product is a commodity, as competition and standardization reduce the need for close collaboration.
質問 # 54
Tim manages the procurement department at a large retailer. He wants to ensure that his team are achieving value for money in their procurement activities. Which of the following should Tim set up?
- A. Audit
- B. ITT
- C. Contract
- D. Framework
正解：A
解説：
Tim should do an audit. P.71 of the textbook says "to ensure that a procurement department is achieving value for money, an audit should be undertaken"
質問 # 55
A local council requires facilities management services for ten schools based in their region. This service is a high-spend, high-risk, critical contract. Which sourcing approach would be the most appropriate?
- A. Direct negotiation
- B. Statement of source requirements
- C. Competitive tendering
- D. Request for quotation
正解：C
解説：
Competitive tendering is the most suitable approach for high-risk, high-value contracts as it ensures transparency, fairness, and the selection of the most capable supplier based on predefined criteria.
質問 # 56
Harry has just entered into a partnership with a key supplier. Although he is excited about the prospect, he thinks it's a good idea to set some goals and KPIs. Which of the following criteria should Harry use to decide if a KPI is appropriate?
- A. Relatable, precise, and measurable
- B. Significant, measurable and achievable
- C. Measurable, achievable and relevant
- D. Time bound, difficult and relevant
正解：C
解説：
The correct answer is Measurable, achievable and relevant. This is from SMART KPIs on p. 151. Smart stands for specific, measurable, achievable, relevant, time-bound. In the exam they come up in different orders so be careful.
質問 # 57
Rachel and Jacky work in the procurement department of Foddy Foods Ltd. They have been told by their CEO to build better relationships with strategic suppliers as this will create value for money for the company. In what ways can value for money be achieved by building strong relationships with suppliers? Select TWO.
- A. Better payment terms
- B. Reduction of waste
- C. Innovation developed as part of collaborative projects
- D. Reducing costs
正解：B、C
解説：
Supplier relationships can result in value for money in the reduction of waste and in innovation developed as part of collaborative projects. Remember that in CIPS waste doesn't necessarily mean physical waste (as in stuff you don't want any more). There are 7 types of waste including waiting, inventory, transportation etc. So when you develop a relationship with a supplier, this can reduce waste (e.g. you may be able to get deliveries quicker by integrating your ordering system with the supplier's, or you might reduce transportation by agreeing a Consignment stock). Having a good relationship with a supplier isn't necessarily going to get you a reduction in cost or better payment terms. See p.70 for more details on this- there's a short list of ways in which good supplier relationships can bring value for money to a business.
質問 # 58
Which one of the following would constitute a succession issue when terminating a relationship?
- A. Deletion of old specifications
- B. Processing penalties
- C. Payment of old invoices
- D. Continuity of supplies
正解：D
解説：
Ensuring continuity of supplies is critical during termination to avoid disruptions. Succession issues focus on maintaining essential operations while transitioning to new suppliers or arrangements.
質問 # 59
Barry is a procurement manager at Sea Biscuits, a company which manufactures biscuits in the shape of dolphins and starfish. He works in an office that orders stationary regularly for its 100 person workforce. Stationary is a low-spend category item and Barry often orders stationary from different suppliers based on which supplier can provide the item the cheapest at that point in time. According to the Kraljic matrix, what type of suppliers provides stationary to Barry?
- A. leverage
- B. Bottleneck
- C. routine
- D. strategic
正解：C
解説：
Stationary is a routine item; it is ordered often (as Barry uses different suppliers), it is a low category spend, and low risk to the business' operations (a late delivery of pens isn't going to stop the company making its biscuits). There are lots of questions on Kraljic in the exam - do revise this topic and ensure you understand each of the four quadrants of the matrix (see p.20)
質問 # 60
A large office orders weekly from a stationery supplier. The items are low-cost, and if the delivery is a day late, it does not affect the running of the office. Where would this supplier be positioned in a supplier matrix?
- A. Bottleneck
- B. Critical
- C. Routine
- D. Leverage
正解：C
解説：
Routine suppliers provide low-value, low-risk items with minimal operational impact. These suppliers are managed with minimal engagement or oversight in a cost-effective manner.
質問 # 61
In Public Sector procurement a PIN is sent out to inform suppliers of an upcoming tender opportunity. What does PIN stand for?
- A. Procurement Information Number
- B. Procurement Identification Number
- C. Possibilities Identified Notice
- D. Prior Information Notice
正解：D
解説：
A PIN is a 'prior information notice' - it is sent out before the ITT to let suppliers know that an opportunity is coming up and they should look out for it. See p 72 "supplier identification- public sector" for more details.
質問 # 62
A medical consumables buyer has adopted a close relationship approach with their suppliers that are considered to be complicated, technical suppliers. Is this the right approach?
- A. No, as there is often a supply risk with items offered
- B. No, as there are only a small number of suppliers in the marketplace
- C. Yes, as all the items supplied are off the shelf
- D. Yes, as the items are of high financial risk
正解：D
解説：
Complex and technical suppliers often involve high financial risks due to the critical nature of their products.
A close relationship ensures better collaboration, risk management, and value generation.
質問 # 63
When developing a supplier partnership, a buyer can take either a strategic or reactive approach. What would be a reason for a reactive approach?
- A. You discover that the supplier has a high profit margin
- B. The buyer wishes to create a new product and requires input from a supplier
- C. Sudden changes in the marketplace
- D. It will allow for consolidation in the supply chain
正解：C
解説：
The correct answer is 'Sudden changes in the marketplace' - this is a reason a buyer would be reactive.
Reactive is when something happens to you and it forces you to act in a certain way. The other options would be strategic rather than reactive. P. 163
質問 # 64
Jenny is a procurement manager who works in the public sector. She has been charged with organising a tender to source new Xray machines for a hospital and to ensure that they receive 'value for money'. Which of the following should Jenny consider when drafting her ITT?
- A. Equity
- B. Availability
- C. Whole life costs
- D. Price only
正解：C
解説：
Jenny should consider whole life costing. Ensuring value for money means considering a combination of price and quality throughout the lifetime of the product. See p.65 for more on 'Achieving Value for Money'
質問 # 65
Mandy is looking to source windows and doors for a new build apartment block. She has done some initial research and has discovered that there are many suppliers in the marketplace that can supply the items she needs. As it is a high-value project she is thinking of running a formal tender. What should be Mandy's first step?
- A. Run a restricted competition - send out a PQQ
- B. Run a restricted competition- send out a RFI
- C. Run an open competition - send out an ITT
- D. Run an open competition - send out a RFQ
正解：A
解説：
The correct answer is 'run a restricted competition - send out a PQQ'. This Question: tests both your understanding of when to run open and restricted competitions (which is explained on p.75) and your understanding of tender documents. Mandy should run a restricted competition- there are a lot of options in the marketplace and this will allow her to pre-qualify those who best suit her requirements. Running an open competition when there are lots of suppliers would be too time-consuming- you need a way of making a short-list. When you run a restricted competition, the first stage is sending out a PQQ- pre-qualification questionnaire; this document is sent to suppliers asking for necessary information to support their qualification as an approved supplier.
質問 # 66
Lee is a procurement manager at Real Pirates Ltd and he has a contract with Peg Leg Industries for the supply of fake, wooden legs for his team of Pirates. Real Pirates Ltd have been working with Peg Leg Industries for almost 10 years but recently Lee has discovered he will need to terminate the contract due to 'Contract Frustration'. What could be the reason for this?
- A. The supplier has leaked confidential information about Real Pirates Ltd to a competitor
- B. The supplier has committed a material breach
- C. The supplier has become insolvent
- D. An unexpected incident has occurred beyond anyone's control
正解：D
解説：
The correct answer is 'An unexpected incident has occurred beyond anyone's control'. A good example of this would be the Covid-19 pandemic- neither the buyer nor supplier could have predicted this, and if this means that the contract can't be completed - then the contract can be terminated (in the UK at least). A way to avoid this would be to include a Force Majeur clause listing possible circumstances that could occur. When there's a Force Majeur clause, these eventualities are now classed as foreseen rather than unforeseen. See p.
108
質問 # 67
What is collaborative inertia?
- A. Where a third party is invited to join a partnership.
- B. the concept that the value and performance of two companies combined will be greater than the sum of the separate individual parts
- C. A situation when the apparent output from collaboration is considerably less than expected
- D. When a partnership is unable to create new ideas
正解：C
解説：
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.
質問 # 68
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