Updated Mar-2025 Exam L4M6 Dumps - Pass Your Certification Exam
Latest Real CIPS L4M6 Exam Dumps Questions
To be eligible for the CIPS L4M6 certification exam, candidates must have completed the CIPS Level 4 Diploma in Procurement and Supply or an equivalent qualification. L4M6 exam consists of 60 multiple-choice questions and is available in both paper-based and computer-based formats. Candidates have two hours to complete the exam, and a passing score of 60% is required to obtain the certification. Additionally, the CIPS L4M6 certification is valid for three years, after which candidates may need to complete a re-certification process to maintain their certification status.
CIPS L4M6 exam is a critical exam for procurement professionals seeking to advance their careers in supplier relationship management. L4M6 exam covers various aspects of supplier relationships, including selection, negotiation, contract management, and performance management. It is an advanced level exam that requires a thorough understanding of procurement and the role of supplier relationships in achieving organizational objectives. Candidates who pass L4M6 exam gain valuable skills and knowledge that can help them to excel in their roles as procurement professionals.
NEW QUESTION # 73
When using competitive forces theory, suppliers are powerful in which of the following situations? Select THREE that apply.
- A. The volume purchased is not important
- B. The switching costs are high
- C. There are few substitute products
- D. The product is undifferentiated
- E. There is potential for backward integration
- F. The product is highly differentiated
Answer: B,C,F
Explanation:
Suppliers gain power when their products have limited substitutes, are highly differentiated, or when switching costs are high. These factors reduce buyer leverage and increase supplier influence, as described in Porter's Five Forces model.
NEW QUESTION # 74
Stephen Jones is assessing the relationships he has with his supplier base. Which of the following would be drivers for Stephen to adopt a partnership relationship with a supplier?
- A. 2 and 3 only
- B. 1 and 2 only
- C. 2 and 4 only
- D. 1 and 4 only
Answer: C
Explanation:
High expenditure levels and the complexity of requirements justify partnership sourcing, as it allows for collaborative problem-solving, innovation, and cost-efficiency. CIPS emphasizes that partnerships are ideal when requirements are complex and require expertise from the supplier.
NEW QUESTION # 75
Which one of the following would constitute a succession issue when terminating a relationship?
- A. Payment of old invoices
- B. Processing penalties
- C. Deletion of old specifications
- D. Continuity of supplies
Answer: D
Explanation:
Ensuring continuity of supplies is critical during termination to avoid disruptions. Succession issues focus on maintaining essential operations while transitioning to new suppliers or arrangements.
NEW QUESTION # 76
Which of the following are considered part of the '5 Rights of Procurement'? Select THREE.
- A. time
- B. place
- C. cost
- D. focus
- E. quality
Answer: A,B,E
Explanation:
The 5 Rights of procurement are; place, quality, quantity, time, price. (Price and Cost are not the same thing). See p.38
NEW QUESTION # 77
David is sourcing a new cleaning contract as he is not impressed with his current cleaning company's performance. He believes that his current supplier has been overcharging him, and due to budget cuts, he is keen to secure a lower price than what he is paying now. His Manager has suggested using an e-auction as the procurement method. Is this the correct way forward?
- A. Yes- an e-auction is an electronic system so it will be easy for David to compare bids
- B. Yes- an e-auction will allow David to secure the lowest possible price
- C. No- a reverse e-auction would be more suitable as it will secure the lowest price
- D. No- a reverse e-auction will ensure only high quality suppliers bid for the opportunity
Answer: C
Explanation:
The correct answer is 'No- a reverse e-auction would be more suitable as it will secure the lowest price'. An E-auction is something like eBay- where bids go up in price. If David wants to secure a lower price, he should use a Reverse E-Auction- where suppliers bid lower than the previous bid in order to win. For example, Supplier 1 offers to fulfil the contract at £50k per year, Supplier 2 can offer to beat this price by bidding £48k per year. Although Reverse E-Auctions may ensure cheaper prices, there are a lot of disadvantages to using this method. See p.21 and p.76 for more information
NEW QUESTION # 78
A partnership approach to a buyer-supplier relationship, as opposed to a traditional adversarial approach, would have which of the following characteristics?
- A. Specifications designed by the buyer
- B. Increased supplier contractual terms
- C. Greater levels of transparency
- D. Shared cost benefits
Answer: C,D
Explanation:
Partnerships are built on trust and transparency, with shared benefits such as cost reductions and improved processes. Adversarial relationships, in contrast, focus on price and contractual obligations.
NEW QUESTION # 79
Andrew runs a factory that makes cakes. Vanilla Extract is a vital ingredient in Andrew's cakes and this is a monopolistic market. Andrew has noticed recently that the quality of the supplier's product has reduced, and this has led to several complaints from customers. Andrew is considering entering into a Partnership with this supplier as he believes this will help increase the supplier's performance. Is this the correct thing to do?
- A. No- Andrew should use an alternative supplier
- B. No- Andrew should outsource the vanilla extract.
- C. Yes- partnership sourcing will improve sales figures
- D. Yes- partnership sourcing can improve performance which will ultimately satisfy the end customer
Answer: D
Explanation:
The correct answer is 'Yes- partnership sourcing can improve performance which will ultimately satisfy the end customer'. The important thing to note in this Question: is the word 'monopolistic'. This means that there are no alternative suppliers- so the 'no' options are wrong- there are no alternative suppliers and no opportunity to outsource. The other answer is incorrect as sales figures isn't Andrew's concern - it's the complaints and quality of the product. Improving performance to satisfy end customers is therefore his main driver for considering a Partnership. See p. 127 for more information on Drivers of Partnership Sourcing. This comes up a lot in the exam
NEW QUESTION # 80
A comprehensive approach to managing the termination of a contractual relationship would include ...
- A. Setting remedies and compensation for contractual breaches
- B. Attacking the personalities, not the problem
- C. Giving qualitative feedback only
- D. Setting aside the value of existing work done by both parties
Answer: A
Explanation:
Effective termination includes remedies and compensation to address any contractual breaches, ensuring fairness and compliance with legal and ethical obligations.
NEW QUESTION # 81
A restricted market is a market where there are only a small number of capable and competent suppliers. Which of the following is not a reason for a marketplace to be restricted?
- A. Strong governmental regulation
- B. Low levels of profitability
- C. The product is easy to source elsewhere
- D. High barriers to entry
Answer: C
Explanation:
The correct answer is 'The product is easy to source elsewhere'. The other three are given as reasons a marketplace might be restricted on p.138. Other reasons also include; brand loyalty, difficult access to distribution channels, and companies colluding.
NEW QUESTION # 82
A company has just hired a new cleaning firm to clean their offices. The specification for the clean was detailed in an appendix in the contract and included a list of pre-approved products that the cleaning firm should use. The cleaners that were sent to site had not read the contract and therefore did not use the appropriate products. What is the reason for the failure of this?
- A. Poor communication
- B. Communication overload
- C. Distortion of the facts
- D. Miscommunication
Answer: A
Explanation:
This is an example of poor-communication. The information was not passed from the person who signed the contract to the staff on site who were to do the cleaning. See p.158 on communication issues.
NEW QUESTION # 83
Which of the following relationship types would you consider using for a Main Contractor on a building construction project, who will be responsible for co-ordinating the activities of other suppliers?
- A. closer tactical
- B. transactional
- C. partnership
- D. co-destiny
Answer: A
Explanation:
in tiered supply chains, a closer-tactical relationship could be used between a buyer and a supplier who will be responsible for co-ordinating the activities of other suppliers (p.8 of the textbook).
NEW QUESTION # 84
Under what circumstances should a competitive tender not be completed? Select TWO.
- A. When the items are of high value
- B. When the items are of low value
- C. When there is a clear specifications
- D. When there is not a clear specification
Answer: B,D
Explanation:
Note the word 'NOT' in the question. In order for a competitive tender to be successful, there should be a clear specification in place (i.e. you need to know what you want, in order for suppliers to bid for it). Competitive tendering should also only be used for high value purchases; it's time consuming to do, so you wouldn't do it for low value items such as pens for the office. Therefore the correct answer to this question is 'items are of low value' and 'there isn't a clear specification'. There's a useful table on p.73 of when you would and wouldn't use a competitive tender.
NEW QUESTION # 85
Kinky Boots Ltd provides high heeled shoes in large sizes. Their target market are Drag Queens. There are a couple of rival shoe manufacturers in this market and Kinky Boots Ltd offer the cheapest high heels. What strategy is Kinky Boots Ltd employing in terms of competitive advantage?
- A. differentiation focus
- B. cost leadership
- C. cost focus
- D. differentiation
Answer: C
Explanation:
This is 'cost focus' - Kinky Boots is both focusing on being a cost leaser (by providing the cheapest products) and focusing on a niche market (drag queens). When these two strategies are combined it is called 'cost focus'.
There's a couple of questions on Porter's Generic Strategies in the exam- there's a useful diagram of this on P.
13
NEW QUESTION # 86
Red Manufacturing work with around 40 different suppliers. One of these suppliers is Blue Business. Red Manufacturing order regularly from Blue Business, and have never had any issues with their performance.
The materials Blue Business supply are of low value and there are several other suppliers of these materials in the market. What type of relationship should Red Manufacturing seek to have with Blue Manufacturing?
- A. single-source
- B. partnership
- C. arms-length
- D. adversarial
Answer: C
Explanation:
The correct answer is 'arms length'. This is a tactical purchase (as it is low value) and keeping the supplier at arms-length means that Red Manufacturing could possibly exploit them to reduce their prices (think back to the Kraljic matrix and where Blue Business would likely fall). A Partnership or Single- Source relationship requires investment into the relationship, and as the products are low value and Red Manufacturing have a lot of other suppliers, they should not be investing time in developing that relationship with Blue Business. An adversarial relationship wouldn't be advantageous as it may lower the performance of the supplier. See the relationship spectrum on p.5 - this is a hot topic for the exam
NEW QUESTION # 87
Early Supplier Involvement can be described as a collaborative relationship between a buyer and a supplier to develop a new project. Handfield's model describes four different levels of supplier involvement ranging from none to 'black box' (which is when the design is primarily driven by the supplier. What other level features on this model?
- A. Blue Box - when the buyer creates the product without input from the supplier
- B. Grey Box - when the involvement is buyer driven
- C. White Box - when there is informal integration and the buyer consults with a supplier on a design
- D. Red Box- when the supplier provides legal advice to the buyer on areas such as copywrite
Answer: C
Explanation:
The Handfield ESI model is on p.98 and comprises of Black Box, Grey Box, White Box and None. Therefore Red and Blue can be automatically discounted. The correct answer is White Box as the definition given is correct. Grey Box is a formalised supplier integration; joint development activity between buyer and supplier.
I have no idea why Handfield calls his system after coloured boxes- but it's only briefly mentioned in the study guide and is not likely to be a big topic in the exam.
NEW QUESTION # 88
Victoria runs a hotel and has recently had several security issues such as attempted robberies. She has decided that she needs to hire a security firm to ensure these issues don't continue. She has done some research and has found there are several local security firms who may be able to provide services to her hotel. However, she hasn't decided exactly what she would require the security firm to do. What should be Victoria's next steps?
- A. Issue a Prior Information Notice
- B. Issue a Request for Quotation
- C. Issue a Request for Proposal
- D. Issue an Invitation to Tender
Answer: C
Explanation:
Victoria should use a 'request for proposal' - this allows the security firms to submit ideas on how best to serve the hotel. They might come up with some ideas that Victoria hasn't thought about and can price against their own ideas. As Victoria doesn't have a concrete specification, an ITT or RFQ are not appropriate. A PIN tells suppliers that a tender opportunity is coming up and is used in the Public Sector. A hotel is not a Public Sector organisation. See p.76 for more information on when to issue a Request for Proposal
NEW QUESTION # 89
According to Michael Porter, what is procurement?
- A. a secondary activity which provides value for money
- B. a support activity which provides a source of competitive advantage
- C. a primary activity which provides value for money
- D. a primary activity which provides a source of competitive activity
Answer: B
Explanation:
This question refers to Porter's Value Chain (p.35). There's a couple of questions on this in the exam so try to learn it. Procurement is a 'support activity' on this matrix along with firm infrastructure, HR and technology development
NEW QUESTION # 90
A garden centre has recently purchased some lollypop sticks to use as plant labels. The staff have written the name of the plant on the lollypop stick and put it next to the plant. This helps them identify which plant is which. However, after a couple of weeks, the lollypop sticks have become mouldy and the writing has faded. Staff are now struggling to identity their plants. The Manager of the garden centre is considering returning the lollypop sticks and asking for a full refund as they were not fit for purpose. Can the Manager do this?
- A. Yes- so long as the manager kept the receipt
- B. No- as this was not the lollypop sticks intended purpose
- C. No- the manager cannot prove that the product is faulty
- D. Yes- the lollypop sticks have gone mouldy- this is unacceptable
Answer: B
Explanation:
The correct answer is 'no- as this was not the lollypop sticks intended purpose'. When deciding if something is fit for purpose, you must consider its intended and common purpose. In this case it would be for making lollypops. As the garden centre is using them for something other than their intended purpose, they can't complain if it doesn't work. Fit for purpose is discussed on p.65 p.s. there's a Question: like this in the real exam - it's just not lollypop sticks ; )
NEW QUESTION # 91
Which of the following is a valid reason for ending a relationship with a supplier?
- A. force majeur
- B. the contract has ended
- C. the supplier delivered one delivery late
- D. the supplier has a new CEO who you don't like
Answer: B
Explanation:
CIPS state the following reasons for the end of supplier relationships; the contract comes to a natural end, the contract is re-tendered, a material breach or the supplier becomes insolvent (p.15) In this case the only valid option is 'the contract has ended'.
NEW QUESTION # 92
The Queen Victoria is a traditional British pub which serves a range of alcoholic beverages. It has a partnership relationship with a local brewery which supplies several types of beer and cider. Logistics is a key concern for the Queen Victoria as deliveries must be made when there is room in the cellar to store the barrels of beer and cider. In what ways could the logistics risk be reduced?
- A. Sharing up-to-date information
- B. Using several suppliers instead of one
- C. Batch ordering
- D. Issuing POs electronically.
Answer: A
Explanation:
The logistics risk can be reduced by 'Sharing up-to-date information'. If the Pub tells the supplier when it's running low, they can then time the deliveries more accurately. P. 136. A lot of the questions on the
'Partnerships' chapters of the book are common-sense questions like this. It involves reading the question and using logic, rather than relying on your knowledge of procurement. If you found this question easy - that's a good sign for the exam.
NEW QUESTION # 93
Rivalry between suppliers is more likely to be intense in which of the following situations?
- A. 1 and 3 only
- B. 1 and 2 only
- C. 2 and 4 only
- D. 1 and 4 only
Answer: C
Explanation:
Intense rivalry occurs when suppliers are equally balanced and face high barriers to exit, leading to aggressive competition to retain market share, as described in Porter's Five Forces model.
NEW QUESTION # 94
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