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Free L4M3 Exam Braindumps (page: 17)

Page 17 of 48
PDF with 189 Questions

A large company supplies a lot of products. Their shipments are often delayed and customers are not satisfied.
Which of the following KPIs is most likely to be applied to this situation?

  1. Technical support
  2. OTIF delivery
  3. Delay damages
  4. Consignment stock availability

Answer(s): B

Explanation:

If the deliveries often delay, buyer should use KPI to measure how many missed deliveries there are and the percentage of total missed deliveries on total number of deliveries for period. OTIF (one- time in-full) delivery might help.
Consignment stock availability means that the supplier holds adequate range/number of units of stock to offer a reliable service
Delay damages are the consequences caused by delay of deliveries Technical support is the acceptable quality of technical information/support provided by supplier for goods supplied. LO 2, AC 2.2



Which of the following statements is true about model form of contract?

  1. When model contracts are employed, there are no requirements for legal advice and input
  2. Model contract form's standard clauses often contain correct legal terminology without recourse to third party experts.
  3. The standard clauses of model contract forms give the offeror legal advantages over the offeree
  4. Only the publishers of model forms of contract can edit the clauses of these forms

Answer(s): B

Explanation:

Model forms of contract are published by some industry or professional organisations such as FIDIC, ITC, CIPS,... These forms are often carefully prepared by legal professionals, with correct legal terminology. The standard clauses within these forms are based on fair and balanced risk/reward allocation between the contracting parties. The model contract forms also include standard clauses to be selected or deleted on an as required basis.
Despite being standardised to be used in any jurisdiction, legal advice may be required if the users decide to make variations to the forms.
The correct answer should be "Model contract form's standard clauses often contain correct legal terminology without recourse to third party experts."


Reference:

CIPS study guide page 144-147 LO 3, AC 3.1



Blakenall District Hospital (BDH) is a large hospital that is a major part of the government's health service. Purchasing staff are in the habit of placing many long-term contracts with suppliers and sub- contractors.
Whilst these contracts are usually carried out successfully, prices are often paid that are well over budget. The purchasing manager is concerned to find that, in some cases, members of staff are forcing suppliers to accept fixed price contracts. The policy has caused several problems such as some suppliers refusing to deal with BDH and a few going out of business mid-way through performing a contract with BDH. This is due to fluctuating market prices of materials. The procurement manager suggests supplier to adopt variable pricing arrangement with price index. Is this a right course of action?

  1. No, variable pricing would only benefit the suppliers
  2. Yes, this type of arrangement would provide absolute certainty when budgeting
  3. Yes, this pricing arrangement would reimburse the fluctuation of material prices
  4. No, price adjustment should be applied to short-term supply contract only (3-month duration or less)

Answer(s): C

Explanation:

Procurement staff in the Hospital is forcing suppliers into fixed price contract. If the costs generally rise, supplier may operate at a loss. This situation can disrupt the relationship, that is the reason why some suppliers refusing to deal with BDH and a few going out of business mid-way. Alternative methods could be variable pricing arrangement. This method would reimburse the fluctuation of market price. It will also benefit buyer if the market price drops. This type of arrangement should be applied to long-term contracts (i.e. 18 months or more).


Reference:

CIPS study guide page 179-184 LO 3, AC 3.3



A purchase order can become a contract between supplier and purchaser if it is...?

  1. Received by the supplier
  2. Accepted by the supplier
  3. Issued by the buyer
  4. Edited by the supplier

Answer(s): B

Explanation:

A purchase order is a document sent from a buyer to a seller, with a request to order a product. The purchase order often has its number, description and quantity of the goods, unit prices and total price, name of issuer, time of delivery, standard terms and conditions, etc. It is effectively an offer to supplier. The purchase order will become a formal contract if supplier accepted it by written notice or by performance (such as deliver the goods to the buyer's premise).


Reference:

CIPS study guide page 33 LO 1, AC 1.2



Page 17 of 48



Post your Comments and Discuss CIPS L4M3 exam with other Community members:

Tina commented on September 20, 2024
I need to emphasis that this exam is extremely HARD! So prepare well or else you will fail. I got lucky and passed mine. But I used these dumps and some other sources.
Singapore
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Evangelista commented on June 30, 2024
the questions assist me to read and understand the material
UNITED KINGDOM
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Leungoinalame Gobuiwang commented on May 01, 2024
That was good questions to explore on
BOTSWANA
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Leungoinalame Gobuiwang commented on May 01, 2024
It bid challenging but I think I can manage
BOTSWANA
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Leungoinalame Gobuiwang commented on May 01, 2024
I think the L4M3 it needs a person to read to understand
BOTSWANA
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Rudasingwa Innocent commented on March 13, 2024
This prepares good managers for procurement
Anonymous
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Rudasingwa Innocent commented on March 13, 2024
This is good since it prepares the future managers for procurement.
Anonymous
upvote