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CIPS L4M5 Exam - Topic 13 Question 69 Discussion

In preparation for holding negotiation meetings with existing suppliers, category manager Stephen would like to appraise the bargaining strength of his organisation. Which of the following are examples of buyer power? Select TWO that apply:
C) Collusion between competitor suppliers
A) Ability to easily switch suppliers
B) Suppliers are limited in number
D) Buyer is large in size relative to suppliers
E) High barriers of entry exist for new suppliers

CIPS L4M5 Exam - Topic 13 Question 69 Discussion

Actual exam question for CIPS's L4M5 exam
Question #: 69
Topic #: 13
[All L4M5 Questions]

In preparation for holding negotiation meetings with existing suppliers, category manager Stephen would like to appraise the bargaining strength of his organisation. Which of the following are examples of buyer power? Select TWO that apply:

Show Suggested Answer Hide Answer
Suggested Answer: C

In the scenario, the value of contract as well as the importance of purchased item justify the procurement's travel. Visiting a supplier at their HQ or operational facility may facilitate the procurement team in assessing, albeit briefly, the culture of the organisation, how busy they seem and how staff engage with each other. A visit is a good opportunity to assess supplier's capacity.

LO 2, AC 2.2


by Blossom at Sep 13, 2024, 02:25 AM

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Gladys
9 months ago
Totally agree with A and D!
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Arlette
9 months ago
Surprised that E isn't considered buyer power too!
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Carlota
10 months ago
A is spot on, but D is a bit iffy.
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Sina
10 months ago
I think B is more relevant than people realize.
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Rosendo
10 months ago
A and D are definitely buyer power examples.
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Coleen
10 months ago
I feel like A and D are the strongest choices here. Switching suppliers easily and being a large buyer both give us leverage in negotiations.
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Novella
11 months ago
I’m a bit confused about B and E. Limited suppliers seem like it could weaken buyer power, but I guess high barriers could also mean less competition.
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Buffy
11 months ago
I remember a practice question where we discussed how a large buyer can influence suppliers, so I’d go with D for sure.
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Fernanda
11 months ago
I think the ability to easily switch suppliers is definitely a sign of buyer power, but I'm not sure about the other option.
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Marge
11 months ago
The key here is to identify factors that give the buyer leverage over the suppliers. The ability to switch suppliers and the buyer's size relative to suppliers seem like the clearest examples of that.
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Kathryn
11 months ago
I'm a bit confused by the options. I'm not sure if collusion between suppliers or high barriers to entry really demonstrate buyer power. I'll have to think this through carefully.
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Chaya
11 months ago
Okay, let's see. I think the ability to easily switch suppliers and the buyer being large relative to suppliers are good examples of buyer power. I'll go with those.
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Nada
11 months ago
This looks like a straightforward question on buyer power. I'm confident I can identify the two correct examples.
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Eleni
11 months ago
Hmm, I'm not sure about this one. I need to think through the concept of buyer power and how it relates to the options given.
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Natalie
1 year ago
E is a tricky one. High barriers to entry could actually limit buyer power, so I'd steer clear of that one.
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Frankie
1 year ago
I agree, E is a tricky one. High barriers to entry might not always mean more buyer power.
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Tomoko
1 year ago
D) Buyer is large in size relative to suppliers
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Myra
1 year ago
D) Buyer is large in size relative to suppliers
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Twana
1 year ago
A) Ability to easily switch suppliers
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Roy
1 year ago
A) Ability to easily switch suppliers
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Gracia
1 year ago
Haha, C is a good one! Collusion between suppliers would definitely work in Stephen's favor. Gotta love when the competition works together... against themselves!
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Dana
1 year ago
User 2: D) Buyer is large in size relative to suppliers
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Nobuko
1 year ago
User 1: A) Ability to easily switch suppliers
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Beckie
1 year ago
I'm not sure about D. I think E could also be an example of buyer power because high barriers of entry for new suppliers can give the buyer more control.
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Chan
1 year ago
I agree, A and D are the way to go. Switching suppliers easily and being a large buyer are definite signs of buyer power.
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Nadine
1 year ago
User 4: It's important to leverage buyer power to get the best deals for the organization.
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Chantay
1 year ago
User 3: Yeah, those two factors can really help in negotiations with suppliers.
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Jose
1 year ago
User 2: I agree, being able to switch suppliers easily and being a large buyer definitely give you an advantage.
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Cristina
1 year ago
User 1: I think A and D are the best examples of buyer power.
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Gilma
1 year ago
A and D seem like the most obvious choices here. As a category manager, Stephen needs to know how much bargaining power he has against his suppliers.
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Tiera
1 year ago
I agree with Kristel. A and D make sense because they show the ability to switch suppliers easily and being large in size relative to suppliers.
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Kristel
1 year ago
I think A and D are examples of buyer power.
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