Free CIPS L4M6 Practice Exam with Questions & Answers | Set: 7

Comprehensive and Detailed Explanation:

The buying organisation's decision to terminate the partnership with supplier FGH is influenced by:

Changes in the composition of the supply market: The entry of new suppliers into the market provides the buying organisation with more options, reducing dependency on FGH and enabling the pursuit of better partnerships.

Poor communication by the supplier: FGH's lack of proactive communication regarding delivery delays has led to frustration, indicating a breakdown in the partnership's effectiveness.

These factors align with the principles of supplier relationship management, where effective communication and adaptability to market changes are crucial.

Routine items are low risk and low value. They are non-critical and often easily sourced. CIPS categorizes such items in the ‘Routine’ quadrant of the Kraljic Matrix, where minimal procurement effort is justified and supply assurance is easily managed.

Economic factors such as unemployment rates affect labor availability, wages, and consumer purchasing power, directly impacting business operations and supply chains.

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.

Arranging a meeting to clarify roles and setting performance targets provides clear expectations and encourages accountability. This aligns with CIPS guidelines on managing conflicts through constructive engagement.

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.

Explanation

This is a threat of a new entrant. The competitor has now entered the washing machine market and is competing directly with you. This is not a threat of substitution as it is the same product. A substitution would be if they invented a new product that washed clothes and people started buying this instead of washing machines. There are many questions in the exam on Porter's 5 Forces - see p. 39