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CIPS L4M5 Exam Syllabus Topics:

SectionObjectives
Understand how to prepare for negotiations in procurement and supply- Analyze the factors that impact on the approach to commercial negotiations
  • 1. The position of buyers and sellers
  • 2. Ownership and stakeholder perspectives
  • 3. Policies, procedures and protocols
  • 4. The impact of time limits and deadlines
- Understand how to prepare for a negotiation
  • 1. The best alternatives to a negotiated agreement (BATNA)
  • 2. The use of bargaining mixes and trade-offs
  • 3. Defining objectives and variables
  • 4. Zones of potential agreement (ZOPA)
Understand the stages of commercial negotiations in procurement and supply- Analyze the types of approaches that can be pursued in commercial negotiations
  • 1. Pragmatic and principled approaches
  • 2. The influence of power and trust in negotiations
  • 3. Distributive (win-lose) approaches
  • 4. Integrative (win-win) approaches
- Understand the stages of a commercial negotiation
  • 1. Bargaining and problem solving
  • 2. Preparation and planning
  • 3. Clarification and justification
  • 4. Closure and agreement implementation
  • 5. Defining the ground rules
Understand the interpersonal skills required for effective negotiation- Analyze the interpersonal skills required for effective negotiation
  • 1. Assertiveness
  • 2. Influencing and persuasion skills
  • 3. Questioning and listening skills
  • 4. Body language and non-verbal communication
- Understand the behavioral aspects of negotiation
  • 1. Ethical and unethical practices
  • 2. Concessions and trade-offs
  • 3. Conflict handling styles
  • 4. Perception and bias

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CIPS Commercial Negotiation Sample Questions (Q23-Q28):

NEW QUESTION # 23
Which best describes features of the recovery phase in a business cycle? Select TWO.

Answer: A,E

Explanation:
In the recovery phase, economies move out of recession: consumer spending rises, demand grows, and prices begin to stabilise or increase. Confidence improves, investment starts picking up, and spare capacity is gradually absorbed. Low confidence and falling investment are features of recession, while full capacity is linked to boom phases. For negotiators, recovery phases may mean suppliers regain confidence to raise prices, requiring careful market analysis.
Reference: CIPS L4M5 (2nd ed.), LO 1.2 - Economic cycles and their implications for negotiation.


NEW QUESTION # 24
In order to mitigate all risks involved in the negotiation process, the buyer only needs to undertake pre- negotiation research on the supply market and establish a BATNA. Is this a correct suggestion?

Answer: D


NEW QUESTION # 25
Stalemate is more likely to happen if both parties trade more variables in a commercial negotiation. Is this assumption true?

Answer: A

Explanation:
Negotiation variables such as price or contract length, etc are that can be traded with TOP in a negotiation.
The more variables you can identify, the better. The more variables you can identify and articulate, the lower the chances of the negotiation reaching deadlock as more possibilities are facilitated regarding more creative solutions.
Below are examples of negotiation tradeables in buying professional services:
LO 2, AC 2.3


NEW QUESTION # 26
A supplier can produce a product for $160 and sells it for $240, making $80 profit. What is the mark-up profit percentage?

Answer: D

Explanation:
Mark-up % = Profit ÷ Cost × 100. Here, profit is $80, cost is $160. So, (80 ÷ 160) × 100 = 50%. This differs from margin, which is profit ÷ selling price. Mark-up analysis helps buyers understand supplier pricing structures, detect hidden margins, and strengthen negotiation. By knowing whether a supplier is working with high or low mark-up levels, buyers can challenge prices more effectively or justify alternative offers. This analytical preparation supports objective negotiation rather than reliance on supplier claims.
Reference: CIPS L4M5 (2nd ed.), LO 2.2 - Understanding costing (mark-up vs margin) in negotiation prep.


NEW QUESTION # 27
The National Schools Purchasing Forum (NSPF) is a procurement organisation that purchases goods and services on behalf of schools on a national scale. NSPF is close to concluding negotiations in a meeting with Hygienics For All (HFA) for the supply of consumables to school washrooms. Both parties have reached an agreeable position and NSPF feels it is important that they conclude the negotiation at this point. What type of questions should NSPF ask HFA to achieve this?

Answer: C


NEW QUESTION # 28
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