Mastering Supplier Selection
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Questions and Answers

Which of the following is NOT considered when determining the 'price' of a goods or service?

  • Unit Price
  • Payment Terms
  • Currency Fluctuations (correct)
  • Volume Discounts
  • What is the main objective of aligning procurement practices with an organization's broader strategic objectives?

  • To prioritize financial savings
  • To enhance efficiency and long term survival (correct)
  • To focus solely on the best price
  • To select suppliers that offer the best value
  • Why is it important to consider additional costs when determining the 'price' of a goods or service?

  • Additional costs are not relevant in procurement decisions
  • Additional costs can impact the effective overall price (correct)
  • Additional costs are included in the unit price
  • Additional costs are always higher than the unit price
  • Which factor should be considered when evaluating the total cost of procurement?

    <p>The volume discounts</p> Signup and view all the answers

    What could be a potential disadvantage of choosing a supplier solely based on lower prices?

    <p>Higher overall costs in the long term</p> Signup and view all the answers

    Why did Organisation A find that Supplier Y's effective price was lower than Supplier X's?

    <p>Supplier Y offered volume discounts</p> Signup and view all the answers

    Which of the following is a benefit of effective communication in managing supplier issues?

    <p>Reduced costs</p> Signup and view all the answers

    Why is effective communication important in managing supplier issues?

    <p>To improve supplier relationships</p> Signup and view all the answers

    How does effective communication contribute to managing supplier issues?

    <p>By preventing supply chain disruptions</p> Signup and view all the answers

    Which of the following is a benefit of effective communication in managing supplier issues?

    <p>Reduced risk of misunderstandings and errors</p> Signup and view all the answers

    Why is it important to consider additional costs when determining the 'price' of a goods or service?

    <p>To calculate the total cost of procurement</p> Signup and view all the answers

    How does effective communication contribute to managing supplier issues?

    <p>It improves supplier relationship and reduces misunderstandings</p> Signup and view all the answers

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