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CIPS - Defining Business Needs L4M2 paper 7.
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1.
A large retail firm is aiming to expand its online presence, where the current ratio is 85% physical stores and 15% online sales. The procurement manager suggests benchmarking against a larger online supplier. Is this a valid recommendation?
2.
Maria, head of procurement at a care home, decides to use performance specifications to acquire a new patient record IT system. Is this approach appropriate?
3.
Moreen is reviewing end-of-life costs in whole-life costing. Which factors should she consider? (Select two)
4.
What factors must a procurement department consider when developing a business case for a new product? Choose two that apply
5.
Company PVX, a steel components manufacturer, needs to source new materials for an upcoming product while maintaining current production. What action should it take?
6.
Ivan uses a conformance specification for buying aircraft parts. Was this appropriate?
7.
What are the advantages of using standards in procurement specifications? (Select two)
8.
Mathew calculates the payback period for a microscope costing £200,000, generating £50,000 annual revenue. What is the payback period?
9.
Buyer power can influence supply market competitiveness. Which of these represent buyer power? (Select two)
10.
Should Bob develop a business case before approving a large equipment purchase?
11.
Suppliers consider various factors when pricing. Which are internal factors? (Select two)
12.
Alex opts for performance-based specifications for a new HR system. Was this correct?
13.
Harpal is assessing textbook manufacturing costs. Which are indirect costs? (Select two)
14.
Which are primary sources of market cost data? (Select two)
15.
JB Group has encountered the following challenges in recent years.
- Rising raw material costs and supply shortages
- Frequent machinery breakdowns causing production delays
- Increased pressure to reduce unit costs while maintaining quality
- Competition from overseas producers with lower labour costs
Based on these challenges, which business sector does the company operate in?
16.
Which sector prioritizes responsiveness to market changes, strong branding, and quick product launches?
17.
What criteria define the creation of a business case?
18.
What should a company consider when procuring an unfamiliar product?
19.
A company reduces components from 50 to 30 by analyzing their value in the final product. What is this process called?
20.
A procurement department requests a pricing structure where the supplier earns £10,000 profit over costs. What is this called?
21.
A company responsible for managing public transport facilities, including the upkeep of bus and train stations frequently used by the public, is developing a cleaning contract. Which criteria should the procurement team prioritize in the specifications to ensure the greatest positive impact on users?
22.
XYZ LTD produces 70% of the nation’s garden furniture. What power does it hold?
23.
John, a junior procurement analyst, has been tasked with reviewing the cost breakdown for key product categories he purchases for his engineering company. After analyzing various cost types, he has identified some necessary adjustments. Which of the following statements about costs are correct?
1. Direct product costs tend to be variable costs for the organization
2. Indirect product costs tend to be fixed costs for the organization
3. Direct costs are also known as overheads for the organisation
4. Indirect costs also known as the marginal costs for the organisation
24.
What are the typical uses of procurement specifications? (Select two)
25.
When acquiring routine items like standard stationery supplies, how can a business ensure functional efficiency?
1.Implementing incentives and penalties within contracts.
2.Adopting e-procurement systems.
3.Introducing competitive bidding processes.
4.Utilizing vendor-managed inventory systems.
26.
A company expects performance from a new IT system. What should its performance specification include? (Select two)
27.
When estimating costs, how do suppliers' pricing strategies reflect market behavior? Choose two
28.
What are key sources for creating specifications? choose two
29.
What forces influence market competition?
