Exam 7: Supplier Evaluation and Selection

As some suppliers view cost data as highly proprietary, buyers will often develop reverse pricing models that provide estimates of the supplier's cost structure during the initial supplier evaluation.

Which of the following information is not generally maintained in a supplier informational database?

Which of the following is not an example of a question that should be asked when evaluating a supplier's production scheduling and control systems?

Using third-party information can be a timely and effective way to gain insight into potential suppliers.

All of the following are examples of questions that should be asked when evaluating a supplier for longer-term relationship potential except _____.

A/An _____ involves sending a preliminary survey to suppliers.

Using existing suppliers, because it is easier and quicker, is always the best long-term approach.

The format of a supplier evaluation should not provide any flexibility across different types of purchase requirements.

Progressive firms are working to increase the length of their purchase contracts.

A _____ has had its quality systems extensively audited by the buying firm and are capable of consistently meeting or exceeding the buyer's quality needs.

Today, buyers seldom use the Internet to help locate potential sources that might qualify for further evaluation.

The popularity of JIT and quick replenishment systems favor using fewer local suppliers.

Which of the following key financial ratios is calculated as Current assets/Current liabilities?

Although many sources exist to discover information about a potential supplier, visiting the actual facility provides the most complete way to ensure an accurate assessment of the supplier.

_____ is the process of identifying potential negative events, assessing the likelihood of their occurrence, heading off these events before they occur or reducing the probability that they will occur, and making contingency plans to mitigate the consequences if they do occur.

A/An _____ is a minor departure from an intended level of performance, or a nonconformance that is easily resolved and does not materially affect the required output.

Supplier size does become a factor when one firm decides to leverage its purchases from one or a few suppliers.

Professional purchasers should become familiar with financial ratios because they can provide quick and valuable insights into a supplier's financial health.

All of the following are characteristics of an effective quantitative supplier evaluation survey except _____.

Which of the following key financial ratios is calculated as Profit after taxes/Sales?