PROCUREMENT MANAGEMENT

What is the definition of procurement management?

• The process of producing goods internally.

• Process of acquiring goods, services, or works from an external source.

• The distribution of finished products to customers.

Why is procurement management important for a business?

• It reduces costs, avoids delays, and ensures efficient acquisition

• It helps in reducing production time.

• It improves customer satisfaction.

How can procurement management contribute to a company’s global expansion?

• By focusing only on local suppliers.

• By outsourcing all production processes.

• By optimizing purchasing and negotiating with international suppliers.

Which of the following is NOT a benefit of supplier evaluation?

• Risk mitigation.

• Cost reduction.

• Increasing production capacity.

Procurement management is only concerned with the purchase of raw materials.

• True

• False

What role does supplier selection and evaluation play in procurement management?

• It assesses suppliers’ performance to meet the organization's needs.

• It automates the procurement process.

• It helps in identifying suppliers who offer the lowest prices.

What are the key skills needed for successful supplier negotiation?

• Financial analysis, risk management, and marketing skills.

• Time management, persuasion, and active listening.

• Emotional control, creative thinking, and engineering skills.

What is the advantage of leveraging volume and long-term commitments in procurement?

• It allows companies to demand lower quality standards.

• It helps negotiate lower prices or reduced delivery charges.

• It limits the number of suppliers available for negotiations.

Effective negotiation with suppliers can help reduce costs and improve the quality of goods and services.

• True

• False

How can building strong relationships with suppliers benefit a company?

• It guarantees lower prices.

• It reduces the need for procurement negotiations.

• Better pricing, preferential treatment, and improved responsiveness.