1. A multinational automotive manufacturer relies on a single supplier for an advanced battery component. The supplier has a monopoly on this technology. How should the company classify and manage this supplier in the Kraljic Matrix?

• • Leverage Item - Engage in aggressive price negotiations

• • Bottleneck Item - Secure supply contracts but seek alternatives

• • Strategic Item - Develop a long-term partnership with supplier collaboration

• • Non-Critical Item - Maintain a transactional relationship

3. A tech startup is looking for a logistics supplier to handle global distribution. What key metric should be considered in supplier evaluation?

• • Supplier's advertising reach

• • On-time delivery performance

• • Number of warehouses owned by the supplier

• • Total number of clients the supplier serves

2. What is one drawback of outsourcing?

• • It invariably results in an increase in both fixed and recurrent costs.

• • It cannot increase accountability of suppliers through a written contract.

• • It does not provide access to specific skills or technologies.

• • It can make an organization lack of management skills to control suppliers.

Which is true about outsourcing and sub-contracting?

• • Sub-contracting is a tactical, short-term approach whereas outsourcing is a strategic long-term decision.

• • "Sub-contracting is a tactical, short-term approach whereas outsourcing is a strategic long-term decision" is correct, "Enterprises do not need to retain certain core capabilities when outsourcing" is incorrect.

• • Enterprises do not need to retain certain core capabilities when outsourcing.

• • "Sub-contracting is a tactical, short-term approach whereas outsourcing is a strategic long-term decision" & "Enterprises do not need to retain certain core capabilities when outsourcing" are correct.

5. A category manager for ductile iron castings (easy to buy products) is tasked with consolidating expenditure and driving savings within the category. The category manager forms a cross-functional sourcing team, conducts spend analysis, and determines that the category fits the "leverage" quadrant of the Kraljic matrix. In this situation, which of the following is the BEST course of actions for the team to take?

• • Conduct an internet search to find new iron casting suppliers in low-cost countries.

• • Check the existing supply base for capabilities and determine if the suppliers are in good standing with the company.

• • Determine the number of suppliers required along with their capabilities, and establish criteria to evaluate them.

• • Pick an existing supplier and have it design the part so that its production processes are optimized for cost.

6. All of the following are required elements in a purchase requisition except:

• • Quantity and date required

• • Estimated unit cost

• • Operating account to be charged

• • Identification and approval of supplier by the end user

7. Recent research indicates that all of the following are top knowledge areas for procurement people except:

• • Supplier relationship management

• • Total cost analysis

• • Consumer behavior

• • Supplier analysis

8. Most organizations are not in business to provide information technology services, yet many have spent valuable time and resources on information technology functions when they should have instead worked on important competencies such as marketing, customer service, and new product design. Outsourcing helps tackle this problem. Which benefit does outsourcing primarily provide in such a scenario?

• • Reduces fixed and recurrent costs.

• • Protects strategic information from being accessible to external suppliers.

• • Increases accountability even without a written contract.

• • Helps focus on an organization's core business.

9. A food manufacturing company is sourcing ingredients from international suppliers. Due to fluctuating market conditions, prices for key ingredients are unstable. What procurement strategy would help the company manage cost fluctuations?

• • Switch suppliers frequently to chase the lowest price

• • Use long-term contracts with price-adjustment clauses

• • Rely on spot buying for maximum flexibility

• • Maintain a single-source strategy to ensure supplier loyalty

10. Which of the following is the MOST important reason that the supply team need to forecast?

• • Determine the quantity required.

• • Determine the availability of the product/service.

• • Determine the supplier's delivery time.

• • Determine the price of the product or service.