RESPONSE After a need in an organization has been identified/understood, defined, justified and authorized, the next stages are to understand how commodity prices are reacting, which suppliers are available and their strength. The make or buy decision can be reached with knowledge from this; the procurement professional can consider the organization external environment, strength, weakness opportunity and threat to develop strategy /plan of how to achieve the procurement. 'STEEPLE' is an effective way to evaluate the external environment. It helps buyers to assess factors that could affect the need in hand and helps them to develop the plan accordingly. 'STEEPLE' is an acronym which stands for, Social, Technology, Economic, Environment, Political, Legal, Ethical 'SWOT' helps the organization to analyze its strength and within the organization and the oppor-tunity and threats outside the organization. 'SWOT' is an acronym which stands for, strength, weakness, opportunity and threats. * Refer to the question column
Question 87
Explain why it is deemed better to use Sea freight rather than air
Correct Answer:
It would be rare to find a supplier who does not emit any form of pollution. However, part of ethical and responsible sourcing is to make effort to reduce impact of population on the planets. Pollution can be factory emission, Noise, smell, Transportation Development, waste disposal. Transportation is a major cause of pollution. The carbon dioxide emitted from vehicles contributes greatly to air contamination. Yet it is better to use sea freight rather than air because it has a smaller impact on the environment.
Question 88
What is PQQ and what does it include?
Correct Answer:
Pre-qualification questionnaire (PQQ) is often standard forms that buyers send to potential suppli-ers. The purpose is to ensure that these potential suppliers could, if they win the contract, supply the product or service to the standard required. PQQ includes requesting details from the potential suppliers on the following information 1. Company Details 2. Environment policies 3. Trading history 4. Ethical policies 5. Financial information 6. Health and safety policies 7. Quality standards 8. References 9. Insurance.
Question 89
What are Carter's 10Cs?
Correct Answer:
See the answer in explanation. Explanation: Carter's 10cs is a detailed mechanism that procurement professional uses to evaluate potential supplier. What the procurement professional should consider in supplier are the following 10 things. 1) Competency 2) capacity 3) Cost 4) Cash 5) Clean 6) Consistency 7) Control 8) Cul-ture 9) Commitment 10) Communication.
Question 90
Which Incoterm applies here? The supplier is responsible for delivering the goods to the buyer's premises, bearing all risk up until this point.
