SCM 421 MIDTERM QUESTIONS AND ANSWERS

What are retail chains large enough to buy directly from manufacturers called? - Answer- National accounts Which of the following is not a process that must be managed in the SCOR model? - Answer- Assess Which of the seven "rights" of purchasing is the most important? - Answer- The right supplier Your goal as a purchasing professional should always be to get the lowest possible price - Answer- False What is the total cost of buying, using, and disposing of an item called? - Answer- Total cost of ownership Purchasing has always been considered a strategic, value-added function. - Answer- False Which of the following is/are true about the "Clerical Era?" - Answer- Purchasing personnel "placed and chased" orders During WWII, there was increased emphasis on purchasing's importance due to which of the following: - Answer- Material shortages What is one trend that has helped to make purchasing strategic? - Answer- Outsourcing What does it mean to say "organizational boundaries are blurred" from a purchasing perspective? - Answer- Suppliers provide innovation, not just goods and services Which of the following is true for a typical manufacturer? - Answer- Purchased inputs are about 60-80% of COGS Purchased goods and services are typically a firm's largest cost category. - Answer- True Example(s) of purchased materials that directly affect the customer experience is/are: - Answer- Car-seat material & Cloth for a sweatshirt Suppliers can be a crucial source of innovation - Answer- True You buy plastic parts that go into your company's finished product. Your CEO just asked you a question about oil market prices. What would your thoughts be about his question? - Answer- You should be making an effort to understand oil prices, since oil is a crucial in