8. When making global sourcing/outsourcing decisions, an assessment of the potential markets where suppliers are located is helpful. In this step, the strategic procurement team identifies potential countries that are feasible sources of the required raw materials, components, finished goods or services. Which of the following is their goal?

a. To decide which market is closest and produces the lowest priced products

b. To decide which market will provide the most cost-effective supply at the lowest risk

c. To decide which market has the greatest political stability and the most direct transportation routes

d. To decide which market is closest to the raw materials needed and the lowest labor costs

9. RPZ Technology Inc., based in the United States, is a branded wireless peripheral manufacturer seeking to lower labour costs of production, but they are concerned about intellectual property protection. Which of the following would be a suitable approach to outsourcing?

a. A direct purchase from a single supplier for the lowest price that meets the specifications

b. Acquisition of the supplier

c. Multiple purchases from multiple suppliers where lower prices still meet the specifications

d. A short-term contract with any ISO9001 vendor that can meet the specifications at a lower price

10. Cransmith Beauty is a cosmetic manufacturer in the UK that is searching offshore markets for lower cost suppliers that can provide them with generic (non-proprietary) ingredients. Which of the following would likely be the most suitable approach to outsourcing?

a. Direct purchase for the lowest price

b. Strategic partnership with a supplier

c. Acquisition of a supplier

d. Joint-venture with a supplier

11. When making a direct purchase in a global sourcing effort, organizations may begin with an RFP to solicit bids from identified potential suppliers. What type of information should be included in the RFP?

a. Detailed product specifications, product liability disclaimers, financial terms, evaluation criteria, and a deadline for responses

b. Detailed product specifications, delivery requirements, internal overhead allocations, financial terms, evaluation criteria, and a deadline for responses

c. Detailed product specifications, delivery requirements, financial terms, and evaluation criteria

d. Detailed product specifications, delivery requirements, pricing structure, financial terms, evaluation criteria, and a deadline for responses

12. When a strategic procurement team enters contract negotiations with a new international supplier, the documentation that includes the metrics, key performance indicators, evaluation criteria, security provisions and audits that the service provider agrees to meet is commonly known as which of the following?

a. Service Level Agreement

b. Priority Protocols

c. Metric Review Document

d. Evaluation Binder

13. Which of the following are used to measure various aspects of supplier performance, such as rates of timely deliveries, number of rejects, technology development or service errors?

a. GPIs

b. RFPs

c. KPIs

d. RFIs

14. Apex Silicon Adhesives Inc. is producing a new type of tape that is being widely adopted by consumers and the product is experiencing considerable market growth. The company currently has few competitors but expects many new entrants soon and they are facing constant demands to increase supply. So the company is embarking on a detailed analysis of contract manufacturing as a way to lower costs and expand their output. Is this a good time in the product lifecycle to engage contract manufacturers?

a. No, the company should maintain their own manufacturing and add production capacity because they still have no competitors

b. Yes, as the growth period reaches its peak, competitors will quickly enter the market so new spending on additional capacity may be unwarranted

c. Yes, because any opportunity to lower costs should be immediately acted

d. No, they should wait until the product reaches the maturity phase of the product lifecycle so that they have a better gauge of competitive demand