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Free L4M5 Exam Braindumps (page: 5)

Page 5 of 70
PDF with 275 Questions

A wide range of factors may be taken into account by suppliers when setting or negotiating prices.
Which of the following are external factors in pricing decisions? Select TWO that apply.

  1. Competition in the market
  2. Cost of production
  3. Where the product is in its lifecycle
  4. Customer perception of value
  5. Costs of sales

Answer(s): A,D

Explanation:

External factors in pricing decisions include Competition in the market (A) and Customer perception of value (D). These factors are outside the supplier's direct control but influence pricing strategies to remain competitive and meet customer expectations:

Competition in the market (A): Market competition dictates how much a supplier can charge without losing business to competitors.

Customer perception of value (D): How customers perceive the product's worth affects its acceptable price range.

These factors are considered external as they relate to market dynamics rather than internal cost structures, according to CIPS's guidance on pricing influences.



Which of the following roles would support negotiations with an external supplier when planning a negotiation for a low-value, routine purchase? Select TWO that apply.

  1. The Human Resource (HR) manager
  2. A legal advisor
  3. The procurement manager
  4. The Chief Executive Officer (CEO)
  5. An internal business user

Answer(s): C,E

Explanation:

For low-value, routine purchases, the involvement of The procurement manager (C) and An internal business user (E) is appropriate. The procurement manager brings expertise in supplier engagement, while the internal business user provides insights on specific needs for the product or service. Involving high-level roles, like the CEO or a legal advisor, is unnecessary for routine purchases, as per CIPS guidance on resource alignment in procurement.



The stages of commercial negotiation involve which of the following characteristics?

  1. Preparation, proposal, bargain, leave
  2. Open, testing, bargaining, closing, revisiting
  3. Preparing, opening, bargaining, agreement, closure
  4. Opening, debating, promising, testing, disagreeing, closing

Answer(s): C

Explanation:

The typical stages of commercial negotiation are Preparing, opening, bargaining, agreement, and closure. This sequence facilitates a structured approach where negotiators prepare strategies, initiate discussions, engage in bargaining, reach agreements, and formally close the negotiation. This structure is emphasized in CIPS materials as essential for achieving a balanced negotiation process.



Which of the following constitutes a key element to developing high-trust supplier relationships?

  1. Contract management
  2. Supplier audits
  3. Delivering on commitments
  4. Information gathering

Answer(s): C

Explanation:

Delivering on commitments is fundamental to building high-trust relationships.
When an organization reliably fulfills its promises, it reinforces the supplier's confidence in the partnership, fostering long-term collaboration.
While contract management and audits are supportive processes, delivering on commitments directly strengthens trust, as emphasized in CIPS best practices for relationship management.






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