QUESTION: 9

A procurement professional is dissatisfied with how a recent negotiation was concluded.
What could they do to improve their negotiation approach?

Seek feedback from the supplier on their recent performance Prepare for all negotiations with a WIN/LOSE (distributive) approach Involve lots of people in future negotiations
Undertake reflective practice after each negotiation

1 and 3
2 and 3
1 and 4
3 and 4

Answer(s): C

Explanation:

To improve negotiation outcomes, seeking feedback from the supplier (1) and undertaking reflective practice (4) are recommended actions. Feedback from the supplier can provide insights into areas for improvement from the counterparty's perspective, while reflective practice allows the negotiator to evaluate their own approach, outcomes, and areas for growth. This approach aligns with CIPS's emphasis on continuous improvement in negotiation skills.

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QUESTION: 10

Maria has adopted an adversarial style relationship with her stationery supplier. This relationship style can be characterised by which of the following? Select the TWO that apply.

Minimal sharing of information
Requirement to exceed expectations
Degree of mutual commitment
Use of power to seek the best possible deal
Requirement to secure quality of supply

Answer(s): A,D

Explanation:

An adversarial relationship is characterized by a competitive, often zero-sum approach where:

Minimal sharing of information (A): In adversarial settings, there is limited transparency as each party prioritizes its interests.

Use of power to seek the best possible deal (D): Power dynamics are leveraged to gain favorable terms, often at the expense of the other party.

This style typically lacks collaboration and mutual commitment, focusing instead on short-term gains rather than building a partnership, as described in CIPS resources on adversarial relationships.

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QUESTION: 11

Which of the following stages of the CIPS Procurement Cycle are typically where commercial negotiations take place?

Contract management and improvement
Develop tender documentation
Market sector analysis
Contract award and implementation

1 and 4
1 and 3
3 and 4
2 and 3

Answer(s): A

Explanation:

Commercial negotiations commonly take place during Contract Management and Improvement (1) and Contract Award and Implementation (4) stages. During these stages:

Contract Management and Improvement (1): Ongoing negotiations may be required to adjust terms and conditions as part of managing the contract lifecycle.

Contract Award and Implementation (4): Initial negotiations finalize terms, setting the foundation for successful contract execution.

These stages are pivotal in ensuring both initial and ongoing alignment, as outlined in the CIPS Procurement Cycle.

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QUESTION: 12

A supplier can produce a product for $160. The supplier sells the product to their client for $240, making a profit before tax of $80 on the transaction.
What is the mark-up profit percentage earned by the supplier on this transaction?

33%
159%
50%
67%

Answer(s): C

Explanation:

The mark-up percentage is calculated as the profit divided by the cost of production, then multiplied by 100 to convert it into a percentage.

Calculation:
(
/
)
×
=
%
(80/160)×100=50%
Thus, the supplier's mark-up percentage is 50%, as per standard pricing calculations used in procurement.

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