L4M4 Exam Dumps - CIPS Level 4 Diploma in Procurement and Supply Questions and Answers

Explanation

economic indices and comparison websites are secondary sources of data. The other three are examples of primary sources of data.

Primary= you get the data yourself

Secondary = you find the data from somewhere else

When evaluating quotations, responsible buyers must look beyond headline price. Lead times (1) affect operational continuity. Add-on costs (2) (e.g., packaging, delivery, handling) can significantly change total cost. Past performance (4) demonstrates reliability and quality, crucial for ethical and sustainable sourcing. Wastage rates (3) may be relevant but are typically assessed in performance monitoring, not initial quotation evaluation. This holistic view aligns with the total cost of ownership (TCO) approach promoted by CIPS, ensuring procurement decisions account for both direct and indirect impacts.

Under FOB (Free on Board), the buyer assumes responsibility once the goods are loaded onto the ship, including costs and risks beyond this point. This Incoterm is commonly used in international trade, helping both parties clarify responsibilities and promote fair risk distribution.

To maintain integrity and avoid conflicts of interest, Tracey should declare the conflict and remove herself from the tender process. Ethical sourcing practices emphasize transparency and fairness, which prevent potential biases and maintain trust within procurement processes.

Restricted tendering is a two-stage process: first, a pre-qualification stage to ensure only capable, compliant suppliers are invited; second, the issue of the ITT to that shortlist. This method is appropriate when requirements are complex, high-value, or where assurance of supplier competence is essential. It is not based solely on price and does not rely on limited supplier numbers but on filtering through qualification. This balances transparency and efficiency, avoiding wasteful evaluation of unsuitable suppliers while still maintaining competitive tension. CIPS L4M4 highlights that restricted tendering strengthens governance, improves efficiency, and ensures due diligence in supplier selection.

Explanation

Weighted points systems can be time consuming to create. They're very transparent and allow for objective grading of supplier bids (so these answers are incorrect). They are not easy to manipulate and this is an advantage of using them.

Profitability and asset levels indicate a supplier’s financial stability and ability to meet contract demands. Responsible sourcing practices include assessing financial capacity to reduce risk in the supply chain and ensure long-term supplier viability.

Demand and currency fluctuations affect commodity pricing. November shows lowest demand, which usually reduces price pressure. Conversely, May (high demand) and months with strong supplier currencies (January, April) would increase costs. By ordering in November, the buyer leverages demand cycles to obtain lower prices. Responsible sourcing requires buyers to monitor market intelligence and seasonal trends to time purchases effectively, mitigating risks of price volatility while ensuring supply continuity. This reflects CIPS’s emphasis on category management and proactive procurement planning.

Where price leverage is limited, buyers should seek value-adds: extended warranties, service levels, training, spares, delivery schedules, sustainability commitments, or risk-sharing. This aligns with total value and ethical outcomes beyond headline price.

Explanation

Incoterms describe the point at which an item is considered 'delivered' and explains who has the risk of what during the transport of the goods.