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L4M4 Ethical and Responsible Sourcing Questions and Answers

Questions 4

A public sector buyer has run a competitive tender, for which there were eight bidders. All bidders have met the public sector organisation's minimum standards. In addition, they must also meet several other requirements. The buyer will make the contract award decision based on which of the following?

Options:

A.

Weighted criteria

B.

The supplier location

C.

Framework agreement terms

D.

The bidder's price

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Questions 5

Why is it important to consider factors such as environmental, social, governance and ethics when analysing tender proposals from the market?

To ensure adherence to sustainability initiatives

To improve the process workflow

To perform supplier spend and monitoring

To identify potential risks within the supply chain

Options:

A.

1 and 2 only

B.

2 and 3 only

C.

3 and 4 only

D.

1 and 4 only

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Questions 6

When would a procurement professional use the Pareto principle?

Options:

A.

when considering changing a supplier

B.

when conducting a value analysis

C.

when looking at whole-life-cycle costs

D.

when appraising a supplier

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Questions 7

In which instance would multiple sourcing be the most applicable approach?

Options:

A.

Sourcing for the provision of a service, where close relationship management is required

B.

Sourcing a specialised, unique component where the supplier’s knowledge is key

C.

Sourcing for high-cost, strategically important components

D.

Sourcing for components required at short notice

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Questions 8

When evaluating a supplier's proposal in relation to ESC (Environmental, Social, Governance, and ethical elements), it is common to send questionnaires to suppliers requesting information, which can later be scored. Which of the following questions would be assessing any of the ESC criteria?

Could you provide details on your manufacturing and raw material costs as part of an open-book pricing contract?

How do you promote equal opportunity for your employees, customers, and suppliers?

What is the annual turnover and profitability of your company?

Does your company have an anti-bribery policy?

Options:

A.

1 and 3

B.

2 and 3

C.

2 and 4

D.

1 and 4

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Questions 9

When might a company send a Request for Information (RFI) to a supplier instead of a Request for Quotation (RFQ)? Select TWO that apply:

Options:

A.

To determine whether the supplier is able to fulfill a purchase order that has already been placed

B.

To obtain indicative prices that could be offered for a range of required products

C.

To ask for the details of the product or the range of services that the supplier has to offer

D.

To establish the details of environmental and quality certificates that the supplier may have

E.

To negotiate the payment terms detailed in the terms and conditions of sale

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Questions 10

Dylan is looking to appoint a new supplier of paint to his manufacturing business. The paint will be used to paint buses and taxis and therefore needs to be high quality and durable. Which of the following should Dylan look for in terms of quality management when appraising the suppliers?

Options:

A.

ISO9001

B.

Carter's 10 Cs

C.

ESG

D.

conformance specification

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Questions 11

In order to assess whether a company is able to meet its current liabilities, which financial ratio should you use?

Options:

A.

Return on Equity

B.

Acid Test

C.

Gearing Ratio

D.

Gross Profit Margin

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Questions 12

Phishing is a type of fraud that is commonly associated with which industry?

Options:

A.

Agriculture

B.

Mining

C.

IT

D.

Construction

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Questions 13

A buyer might opt to do an 'Invitation to Tender' (ITT) rather than a 'Request for Quotation' (RFQ) process because …

Options:

A.

The nature of the goods or services being purchased are complex and high value

B.

The contract will be low value and there are many suppliers, therefore a simpler approach is required

C.

The supplier market is an oligopoly where a few large suppliers dominate the market

D.

Time is of the essence and decisions need to be made quickly without additional stakeholder involvement

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Questions 14

Which of the following payment mechanisms is most beneficial to the buyer?

Options:

A.

open/ credit account

B.

term / time draft

C.

sight draft

D.

cash in advance

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Questions 15

Which of the following should be assessed in supplier proposals to check compliance with environmental, social, and governance (ESG) standards? Select THREE that apply.

Options:

A.

The company's criteria for make or buy decisions

B.

The financial stability of the company

C.

Procedures on intra-company trading

D.

The company’s employee working conditions

E.

The company's code of ethics

F.

The company's policy on carbon emissions

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Questions 16

The procurement team received an urgent request to source quotations for pest control services. The team decided to use a local newspaper to advertise the requirements. Was this an appropriate approach?

Options:

A.

No, because international vendors must also be notified of the opportunity

B.

Yes, so that the local pest control sector can decide between them who should bid

C.

No, because they might receive too many irrelevant proposals which may delay the assessment process

D.

Yes, they must seek as many bids as possible even if it takes longer

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Questions 17

Curly Cake Incorporated makes lots of different types of confectionary items. Although they are most famous for their cakes, they also have a smaller line of cereal bars and biscuits. Which of the following would be the most appropriate items for Curly Cake Incorporated to outsource? Select TWO

Options:

A.

cakes

B.

cereal bars and biscuits

C.

cleaning

D.

facilities management

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Questions 18

A procurement manager analyses total company expenditure on goods and services. What can expenditure by product category or supplier achieve? (Select TWO)

Options:

A.

Provide information on costs and trends for comparison

B.

Help set the organisation’s marketing strategy

C.

Highlight opportunities for negotiating better prices

D.

Provide analysis to help with production planning

E.

Identify how obsolete stock can be disposed of sustainably

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Questions 19

Which of the following are key areas of regulations governing responsible procurement and supply?

Options:

A.

Digitisation, artificial intelligence, and innovations

B.

Company culture, product branding, and staff uniforms

C.

Ethical practice, data protection, and marketplace competition

D.

Competitive pricing, unsecured loans, and threats of new entrants

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Questions 20

Incoterms are divided into four main groups to follow movement of goods covering exporter’s premises, export/import points, and cost/risk. Which letters represent the groups?

Options:

A.

E, F, C, D

B.

E, F, B, C

C.

B, C, F, C

D.

A, B, C, D

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Questions 21

Who was responsible for introducing the concept of Incoterms?

Options:

A.

United Nations Commission

B.

International Commerce Centre

C.

International Chamber of Commerce

D.

World Trade Organisation

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Questions 22

You have been asked to purchase 500 pens of a specific brand. You decided to use a weighted points system for assessment of proposals. Is this approach appropriate?

Options:

A.

Yes, a weighted points system is always the best way to evaluate suppliers' bids

B.

No, it is not necessary, as in this case, you are mainly concerned with price

C.

Yes, you should follow the same procurement process irrespective of the circumstances

D.

No, you should only use a weighted points system for high-spend procurement

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Questions 23

Which of the following payment mechanisms is most beneficial to the supplier?

Options:

A.

open account

B.

cash in advance

C.

sight draft

D.

letter of credit

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Questions 24

Private sector procurement organisations should always allow suppliers at least 35 days to respond to invitations to tender. Is this statement true?

Options:

A.

No, because this timeframe will cause delays that are unacceptable to stakeholders

B.

Yes, because it helps suppliers to plan and prioritise their work

C.

No, because the complexity of the tender should inform the response timescale

D.

Yes, because that timeframe is internationally recognised as being appropriate

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Questions 25

Which of the incoterms listed are suitable for transporting goods via train?

Options:

A.

FAS

B.

FOB

C.

CRF

D.

EXW

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Questions 26

A buyer is procuring metals. The following trends are observed:

    January and April: supplier’s local currency is strong

    November: demand is lowest

    May: demand is highest

Which month should the buyer place the order?

Options:

A.

May

B.

November

C.

January

D.

April

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Questions 27

A buyer for a large manufacturing organisation is assessing a sole supplier tender opportunity. The buyer is finding it challenging to differentiate the proposals on unit purchase price. Are there any added values that the procurement manager can use to leverage the sole supplier proposal?

Options:

A.

Yes, but only if the buyer decides to re-start the tender opportunity

B.

No, the buyer must make the decision based on the existing information

C.

No, because a buyer has no leverage over a sole supplier

D.

Yes, the buyer can negotiate on aspects such as after-sales service

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Questions 28

What are some of the benefits of conducting unscheduled supplier audits? Select TWO that apply.

Options:

A.

Unscheduled audits significantly reduce costs compared to scheduled visits

B.

Unscheduled audits help to achieve an unbiased assessment

C.

Unscheduled audits help to identify non-compliance issues

D.

Unscheduled audits increase the risk of providing misinformation

E.

Unscheduled audits are more time-efficient than scheduled audits

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Questions 29

“Phishing” occurs when an employee receives a false email that appears genuine, exposing the organisation to cybercrime. Which crime category does this fall under?

Options:

A.

Corruption

B.

Bribery

C.

Human rights

D.

Fraud

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Questions 30

What type of ratio is used to measure a company's ability to meet its short-term financial obligations, specifically focusing on its ability to convert assets into cash to cover current liabilities?

Options:

A.

Earnings per share

B.

Profitability ratio

C.

Dividend per share

D.

Liquidity ratio

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Questions 31

If a company is described as 'liquid' what does this mean?

Options:

A.

the company is funded on equity rather than debt

B.

the company spends a lot of money

C.

the company is highly profitable

D.

the company has enough money to pay short-term liabilities

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Questions 32

Liquidity is a solvency measure which determines whether an organisation is able to pay its debt. Which of the following would you use to assess a supplier's liquidity? Select TWO.

Options:

A.

current assets

B.

current liabilities

C.

long-term debt

D.

shareholder's equity

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Questions 33

For complex and high value tenders, which document is the most appropriate to send to those suppliers who have already been appraised and deemed suitable?

Options:

A.

PQQ

B.

ITT

C.

RFQ

D.

RFT

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Questions 34

As a procurement officer for a large organisation, a supplier approaches you on social media offering to take you out for dinner to discuss a recent open opportunity and mentions a financial reward if you help them win the business. You accept the invite. Was this the right thing to do?

Options:

A.

Yes, you are free to do what you like outside of business hours

B.

No, it is not appropriate to discuss open opportunities with one provider and not another

C.

Yes, you are keen to see what is on offer as you are only on minimum wage currently and need extra money

D.

No, but you will go for the dinner and see what they offer, because it is up to you to decide if you should accept

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Questions 35

Incoterms are divided into four main groups to follow the movement of goods covering the exporter’s premises, export and import points, and cost and risk. Which letters represent the four groups of Incoterms?

Options:

A.

E, F, C, and D

B.

E, F, B, and C

C.

B, C, F, and G

D.

A, B, C, and D

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Questions 36

In the Public Sector, what is the evaluation criteria most often used when evaluating bids from suppliers?

Options:

A.

Most Economically Advantageous Tender

B.

Best Value for Money

C.

Cheapest Overall Tender

D.

Best Business Fit

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Questions 37

Raja is a procurement manager who is keen to gain further insight into the current marketplace and whether local suppliers are capable to provide a service he is looking to procure. He wishes to test the market before he begins a formal tender process. What should Raja do?

Options:

A.

send out a RFI

B.

send out a RFQ

C.

speak with his current suppliers

D.

conduct an open competition

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Questions 38

A procurement manager for a major retail group is using ratio analysis to assess the financial viability of suppliers who have tendered for a logistics services tender. The recommended supplier has a current ratio of 0.6. What are the potential consequences of awarding the contract to this supplier, given their current ratio is below 1?

Options:

A.

The results of the current ratio do not mean anything as long as the supplier has proven technical merit

B.

The supplier will be unable to cover long-term liabilities from revenues

C.

The supplier will have cash reserves to cover unexpected expenses

D.

The supplier will be unable to pay its short-term liabilities using current assets

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Questions 39

Damian is a procurement professional in the Public Sector. He has recently run a competition to source new uniforms for hospital staff and has decided on a suitable supplier. Should Damian con-duct post tender negotiation with the supplier?

Options:

A.

yes- post-tender negotiation may result in a lower price and thus better value for money

B.

yes- all tender processes should include post-tender negotiation

C.

no- this isn't necessary as Damian has selected the most appropriate supplier

D.

no- it would be against the law for Damian to do this

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Questions 40

A 'carnet' provides evidence of the origin of goods shipped in an international trade transaction. Is this statement correct?

Options:

A.

It is a widely used import document that confirms the origin of goods

B.

It is a document that allows the temporary free movement of goods

C.

It is only used when exporting goods from Europe and confirms the country of origin

D.

It is a type of insurance cover to protect against loss of goods in transit

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Questions 41

A procurement manager has developed some reports in order to analyse total company expenditure on bought-in goods and services from external suppliers. Expenditure information by product category or supplier can achieve which of the following? Select TWO that apply.

Options:

A.

Help the organisation set its marketing strategy

B.

Highlight opportunities for negotiating better prices and reducing costs with suppliers

C.

Provide information on costs and trends to compare with previous time periods

D.

Provide analysis to help with planning production schedules

E.

Identify how obsolete stock items can be disposed of in a sustainable way

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Questions 42

Which of the following are primary sources of data? Select TWO.

Options:

A.

market reasearch commissioned by a rival company

B.

economic indices such as PPI or CPI

C.

published price lists

D.

trade fairs and exibits

E.

phone calls with current suppliers

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Questions 43

Which of the following would be considered a strategic sourcing activity?

Options:

A.

an office ordering copier paper

B.

a bakery ordering eggs

C.

a factory ordering a new machine

D.

a restaurant ordering plastic cups

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Questions 44

The procurement manager has received the following data from the supplier's accounts to facilitate the calculation of the supplier's current ratio:

Current Assets: Stock $200; Debtors $60; Cash $40; Total $300

Short Term Liabilities: Bank overdraft $150

Which calculation will the procurement manager use to find out the current ratio?

Options:

A.

(300 - 200) ÷ 150

B.

300 ÷ 150

C.

(300 - 200 - 150) × 100

D.

(300 ÷ 150) × 100

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Questions 45

Which of the following are procurement procedures permissible under EU Public Procurement rules? Select TWO that apply.

Options:

A.

Open procedure

B.

Complex procedure

C.

Restricted procedure

D.

Public procedure

E.

Conformance procedure

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Questions 46

A procurement manager of a medium-sized company has suggested to their executive board that implementing an ISO environmental standard would improve procurement practices and reduce environmental and social impacts. However, some colleagues are concerned about the potential complexity and supplier resistance. Should the company go ahead with the recommendation?

Options:

A.

Yes, as it would align with, and help to achieve, sustainability goals

B.

No, ISO standards are too complex for staff and suppliers to understand and follow

C.

No, because ISO standards are only relevant to large organisations

D.

Yes, implementation would guarantee that the company is compliant with all environmental laws

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Questions 47

What would an EBITDA ratio show you?

Options:

A.

how profitable a business is

B.

how solvent a business is

C.

how much of a business's funding is made up of long term debt

D.

how effectively a business uses its assets to generate sales

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Questions 48

One approach to managing supply risk is by having multiple suppliers of a given product or category of requirements. This approach has both advantages and disadvantages. Which of the following conditions would be a reason for multiple sourcing arrangements?

Options:

A.

It is suitable for high-value, one-off requirements such as machinery

B.

It increases the risk and costs of switching within the supplier base

C.

It is suitable for high-value requirements such as raw materials

D.

It restricts opportunity for competition within the supplier base

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Questions 49

Ramesh is a procurement manager who is looking at his supplier base. He is pursuing a sourcing strategy with the aim of enabling logistical cost reductions. He has made the decision to scale-down his supplier base and purchase from one supplier.

Which type of sourcing arrangement has Ramesh began?

Options:

A.

dual

B.

multiple

C.

single

D.

sole

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Questions 50

Which of the following would you expect to find in an Invitation to Tender? Select THREE

Options:

A.

awarding body

B.

deadline(Correct)

C.

pricing schedule

D.

qualifications required

E.

risk assessments

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Questions 51

When working closely with a supplier, waste can be reduced which can lead to improved business functions and cost savings. Which of the following are wastes that can be removed from the supply chain? Select THREE.

Options:

A.

Over-analyzing

B.

Barriers

C.

Motion

D.

Waiting

E.

Inventory

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Questions 52

Achieving the 'five rights of procurement' is one of the key objectives of procurement managers. Which of the following are not considered one of the 5 rights? Select TWO.

Options:

A.

time

B.

ethics

C.

environment

D.

quantity

E.

quality

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Questions 53

Supplier selection focuses on which of the following?

    Supplier suitability and capability of meeting requirements

    Which pre-qualified supplier represents the best outcome

    Financial stability and quality culture of the supplier

    Most time-efficient tender from a supplier

Options:

A.

3 and 4 only

B.

2 and 4 only

C.

1 and 3 only

D.

1 and 2 only

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Questions 54

Bob works in the procurement department of a construction firm. He has been asked to procure an item for a short-term project which is considered low risk. What type of sourcing will he be completing?

Options:

A.

tactical

B.

strategic

C.

outsourcing

D.

insourcing

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Questions 55

The International Chamber of Commerce (ICC) publish a list of commercial rules known as Inco-terms. What is the purpose of these rules?

Options:

A.

to state which products can be exported from which countries

B.

to ensure buyers and suppliers pay the correct level of tax on imported and exported goods

C.

to describe the point at which an item is considered delivered

D.

to provide internationally recognized product descriptions

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Questions 56

Which of the following incoterms has the lowest risk to the buyer?

Options:

A.

exworks

B.

delivered duty paid

C.

carriage and insurance paid to

D.

free on board

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Questions 57

A company has a requirement for an item that has been identified as strategic on the positioning model. The company needs to invite competitive tenders and ensure the selected supplier of this item is in a good financial position. What should the company ask the suppliers to send to show that their current assets cover their current liabilities?

Options:

A.

Profit and loss account

B.

Annual turnover

C.

Gearing ratio

D.

Acid test

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Questions 58

During the quality assurance of a supplier, Margaret is looking for an international standard that shows the supplier's commitment to sustainable procurement. What document should the supplier provide to show this?

Options:

A.

ISO20400

B.

ISO14000

C.

ISO9001

D.

ISO27000

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Questions 59

Ali is the Category Manager at an airplane manufacturing factory. He works with many different suppliers who provide different components for the planes. The company is investing heavily in Environmental and Social Governance and Ali has been asked by the CEO what the best practice is to ensure ethical behaviour from suppliers. Ali has suggested completing Audits. Is this the right thing to do?

Options:

A.

No- audits will only reveal financial issues not ethical ones

B.

No- Ali should simply ask the supplier's about their ethical practices

C.

Yes- audits always uncover ethical violations such as modern day slavery

D.

yes - these can be completed without warning which would give Ali an accurate picture of the supplier's operations

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Questions 60

Which of the following are reasons to outsource part of a business to an external supplier? Select TWO.

Options:

A.

the product or service is core to the organisation

B.

there are more resources in-house

C.

overheads can be kept as effective as possible

D.

the reduction in the need to continually invest in new machinery

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Questions 61

In which type of market would you be most likely to find a 'perfect competition'?

Options:

A.

monopoly

B.

oligopoly

C.

commodity

D.

monopolistic competition

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Questions 62

Sourcing aims to achieve the best value for money by taking into account several factors. Freddy issourcing a new component for his company which manufactures tractors. Should Freddy take into consideration ethics and sustainability?

Options:

A.

yes- ethics and sustainability form part of 'value for money'

B.

yes- ethics and sustainability show that the products are fit for purpose

C.

no- 'value for money' is concerned with achieving the lowest price

D.

no- 'value for money' only concerns price and if the product is fit for purpose

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Questions 63

Which of the following is not a indices that measures economic data?

Options:

A.

PPI

B.

CPI

C.

GDP

D.

ISO

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Questions 64

A buyer has been working with managers on a tender and is now assessing supplier proposals. Is it good practice for the procurement buyer to make sourcing recommendations?

Options:

A.

No, it is a lengthy and unnecessary step for the procurement buyer

B.

No, the buyer’s recommendations are not relevant; only managers decide

C.

Yes, the procurement buyer should decide independently to avoid conflict of interest

D.

Yes, the procurement buyer can advise on the proposals, but decisions should involve business managers

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Questions 65

Which of the following should form part of the initial evaluation process for non-domestic vendor supply proposals?

Options:

A.

Contract management

B.

Incoterm classifications

C.

Internal benchmarking

D.

Supplier development

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Questions 66

A buyer is assessing a supplier’s proposal in terms of any added value offered. Which of the following are examples of added value?

    The supplier has submitted the lowest price compared to competitors

    The supplier is offering solutions to reduce costs in the supply chain

    The supplier is committed to reducing plastic and waste in operations

    The supplier is personally known by the Operations Director

Options:

A.

1 and 3

B.

1 and 4

C.

2 and 3

D.

3 and 4

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Questions 67

What is a risk of pre-warning a supplier that you will conduct an audit of their facilities?

Options:

A.

they will not be able to make that time and date

B.

they will not perform regular duties that day

C.

they will not achieve KPIs

D.

they may coach staff in what to say

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Questions 68

ABC Ltd works with supplier XYZ Ltd who uses a variety of subcontractors. ABC has recently learned of an ethical breach being committed by one of XYZ's subcontractors. What should ABC do?

Options:

A.

Recommend remedial action

B.

Seek compensation

C.

Terminate the contract

D.

Research alternative suppliers

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Questions 69

Foresttors Plc is negotiating a new contract for the procurement of timber, a crucial component of its production operations. The company has incorporated environmental, social, and governance (ESG) reporting requirements into the contractual terms. Is this a valid approach?

Options:

A.

No. ESG is not within the scope of a contractual document and should always be treated informally

B.

No. Suppliers cannot be legally responsible for ESG compliance; this should be the buying organisation

C.

Yes, providing the contract does not require a supplier to do anything differently for ESG than they have done previously

D.

Yes. This helps to demonstrate the importance of compliance with ESG

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Questions 70

When conducting a competitive tender, is it appropriate to use a supplier's credit rating as a criteria for pre-section?

Options:

A.

yes- because a low rating would have a negative impact on the company's reputation

B.

yes- because a low rating would indicate the supplier is financially unstable

C.

no- because a low rating would not affect the quality of the products supplied

D.

no- because a low credit rating would have a negative impact on the supply chain

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Questions 71

A buyer has been tasked with placing an order for steel from another country and using Incoterms for the delivery. The buyer's organisation has an in-house transportation and export clearance department. During negotiations, the buyer achieved a 25% cost reduction by accepting responsibility to arrange loading, transportation, and export clearance. Which Incoterm has been agreed?

Options:

A.

CIP - Carriage and Insurance Paid

B.

FOB - Free on Board

C.

FCA - Free Carrier

D.

EXW - Ex Works

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Questions 72

You have been asked to purchase 500 pens of a specific brand. You decided to use a weighted points system for assessment of proposals. Is this approach appropriate?

Options:

A.

Yes, a weighted points system is always the best way to evaluate bids

B.

No, it is not necessary as in this case, you are mainly concerned with price

C.

Yes, you should follow the same procurement process irrespective of the circumstances

D.

No, you should only use a weighted points system for high-spend procurement

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Questions 73

Which of the following Incoterms has the lowest risk for the supplier?

Options:

A.

ex works

B.

delivered at terminal

C.

free on board

D.

delivered duty paid

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Questions 74

The sourcing process is considered to include the initial stages of the generic procurement cycle, up to the stage where the contract is awarded to the successful bidder. The stages in the sourcing process may include ...

Options:

A.

Comparing the supplier’s delivery note with the purchase order to confirm the specification

B.

Reminding the design manager to approve the drawings which will accompany the invitation to tender documents

C.

Processing the requisitions to facilitate call-offs against a newly created framework contract

D.

Engaging with suppliers to ensure that they are achieving the KPIs set in the contract

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Questions 75

Jamilla is looking to find a new supplier who can deliver raw materials of wood and paper to her company Woody Manufacturing Incorporated. The requirement is for regular orders of high volume. She has issued a Request for Quotation. What will this assess the suppliers on?

Options:

A.

who can deliver the items the cheapest

B.

who can deliver the highest quality items

C.

the five rights of procurement

D.

which price is the most ethical

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Questions 76

Procurement professionals should never appoint any suppliers that have a low credit rating. Is this statement TRUE?

Options:

A.

Yes, because this rating indicates poor financial management practices

B.

No, because a credit rating is only one financial tool to be used in determining financial competence

C.

No, because a credit rating is not an appropriate decision-making tool

D.

Yes, because this rating means that insolvency or liquidation is imminent

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Questions 77

Jack Green is using an open tender to source a new component for a product. What must be considered if using an open tender?

Options:

A.

There must be an adequate number of suppliers in the market

B.

The tender will only be advertised in marketing journals

C.

Bidders must be pre-qualified prior to invitation

D.

Price will be the only selection criterion

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Questions 78

The bill of lading is one of the main documents in sea freight. Which of the following statements represent its uses? (Select TWO)

Options:

A.

It provides evidence guaranteeing the use of Incoterms

B.

It provides evidence of the contract of carriage for the goods

C.

It provides evidence that the goods are fully insured in transit

D.

It provides evidence of the country of origin of the goods

E.

It provides evidence of the title of ownership of the goods

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Questions 79

A buyer of bakery and cereal products has tracked wheat prices. Severe weather has reduced wheat supply globally, but demand remains high. How can this research help the buyer?

Options:

A.

Bakery produce is likely to be at a lower price as there is less wheat flour available

B.

The price for wheat-based produce will not be affected as demand is still high

C.

The buyer will be in a strong bargaining position to reduce prices

D.

The buyer will find it difficult to negotiate a lower price for wheat-based ingredients

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Questions 80

Daniel is evaluating bids from new suppliers who are looking to supply his company XYZ Indus-tries with components for manufacturing. Although price is important, Daniel wishes to consider 'added value'. Which of the following is considered an 'added-value solution'? Select THREE

Options:

A.

innovation

B.

on time in full deliveries

C.

bulk discount

D.

sustainability

E.

cost plus pricing

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Questions 81

When looking at credit scores, a supplier may be classified as a high risk for reasons that are notlinked to poor credit. Which of the following could these be? Select TWO

Options:

A.

The organisation is new

B.

The organisation has no loans or credit cards

C.

The organisation has lots of fixed assets

D.

The organisation does not employ many people

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Questions 82

Which is an example of a criterion for supplier selection during a tender for a hospital build to demonstrate the people element of the 'triple bottom line'?

Options:

A.

Specifications are designed with appropriately certified materials

B.

Demonstrated commitment to a labour industry code of conduct

C.

Project plan is designed to use reverse logistics

D.

Building design is thermal efficient to meet carbon trust targets

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Questions 83

What course of action should be taken when an audit of a supplier identifies evidence of human rights malpractice?

Options:

A.

Immediately raise the issue with the supplier and jointly develop a timely action plan to be implemented before a repeat audit

B.

Immediately halt all orders with the supplier, make a record of the violation in the supplier database, and switch to an alternative source of supply

C.

Remove all business and inform press organisations, who will in turn bring the issue to the attention of formal governmental organisations who can take action

D.

Allow the supplier to complete current orders placed, while pursuing an alternative source to change to as soon as approved

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Questions 84

Tendering is a more formal and regimented process than sending out requests for quotations. Which of the following are services that are often put out to tender? Select THREE.

Options:

A.

security

B.

consultancy

C.

provision of raw materials

D.

office supplies

E.

cleaning

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Exam Code: L4M4
Exam Name: Ethical and Responsible Sourcing
Last Update: Oct 29, 2025
Questions: 282

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