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| Section | Weight | Objectives |
|---|---|---|
| Topic 1: Understand options for sourcing requirements from suppliers | 25% | - Sourcing approaches and strategies
|
| Topic 2: Understand ethical and responsible sourcing principles and practices | 25% | - Sustainable and responsible sourcing
|
| Topic 3: Understand compliance issues when sourcing from suppliers | 25% | - Organisational policies and procedures
|
| Topic 4: Understand key processes to analyse potential external suppliers | 25% | - Supplier appraisal and evaluation
|
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NEW QUESTION # 226
What are the risks of outsourcing?
* Loss of control of a project
* Loss of assets
* Loss of future business opportunities
* Loss of private information
Answer: A
Explanation:
Outsourcing can lead to a loss of control over certain aspects of a project, as the organization relies on external parties to deliver services or products. Additionally, sharing sensitive information with third-party vendors increases the risk of data breaches or loss of private information. While there may be concerns about assets or future business opportunities, the primary risks in outsourcingrelate to control and information security.
Reference:
CIPS Level 4 Diploma in Procurement and Supply, L4M4 Study Guide, Section 3.2: Risks Associated with Outsourcing
NEW QUESTION # 227
When looking at credit scores, a supplier may be classified as a high risk for reasons that are not linked to poor credit. Which of the following could these be? Select TWO
Answer: C,D
Explanation:
New organisations or those with no loans/ credit cards may have low credit scores. This is simply because they do not have enough financial history to make their scores good. That means banks au-tomatically class them as higher risk, because they simply don't know that they're trustworthy yet.
NEW QUESTION # 228
When might a company send a Request for Information (RFI) instead of a Request for Quotation (RFQ)?
(Select TWO)
Answer: C,D,E
Explanation:
An RFI is an exploratory tool, used to gather information before specifications or tendering. It is appropriate for obtaining indicative pricing (A), understanding the range of products/services (C), and confirming certifications like environmental or quality standards (D). RFQs, by contrast, request firm pricing based on defined specifications. RFIs are not used to renegotiate existing contracts (E) or agree payment terms (B).
Responsible sourcing emphasises using RFIs to identify suppliers aligned with ethical, environmental, and operational expectations before moving to a formal competitive process.
Reference: CIPS L4M4 Study Guide (v2), LO: "Implementation" - RFI, RFQ, and ITT differences.
NEW QUESTION # 229
Sourcing is part of the procurement cycle and is likely to be used in conjunction with which activities? (Select TWO)
Answer: A,C
Explanation:
Sourcing relates to identifying suppliers (E) and requesting quotations (D) as part of the market engagement stage of the procurement cycle. By contrast, creating call-off orders, raising requisitions, and goods receipting are post-contract operational activities. Responsible sourcing highlights that supplier identification and quotations are key to ensuring ethical, competitive, and compliant supply chains. These activities help ensure alignment with organisational goals, supplier diversity, and sustainability objectives.
Reference: CIPS L4M4 Study Guide (v2), LO: "Application" - sourcing activities within the procurement cycle.
NEW QUESTION # 230
Which of the following Incoterms has the lowest risk for the supplier?
Answer: B
Explanation:
Ex-Works has the lowest risk to the supplier- in Exworks the buyer collects the items directly from the supplier - so they have all the issues and risks of transporting it back home.
There are many question on Incoterms CIPS can ask. But as there's such a huge bank of questions it's really hit or miss if you'll get one of those question. Two students sitting the exam at the same time in the same study centre can get different question sets. One person can get 3 Incoterm questions and the other gets 0.
I would learn the major ones- the ones at the ends of the table in particular because these are the ones question are likely to be about. Ex works / Free carrier and Delivered at Place Unloaded/ De-livered Duty Paid in particular.
I like this graph as I'm a visual person. I think it makes it easier to understand than the study guide:
Shipping Incoterms: the Complete Guide - Guided Imports
NEW QUESTION # 231
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