©JASONMcCONNELL 2025 ALL RIGHTS RESERVED
CIPS L4M6 LO3 Exam Questions and
Answers 100% Pass
What is type 1 of partnership? - Answer✔the organisations recognise each other as partners
and co-ordinate activities and planning on a limited basis. the partnership has a short-term
focus and involves only one function within each organisation. partnerships of this type are less
time intensive to develop
what is type 2 of partnership? - Answer✔both companies progress beyond co-ordination of
activities to integration. the partnership has a long-term focus and a number of functions within
both companies are involved
what is type 3 of partnership? - Answer✔the companies share a significant level of operational
integration. the buyer and supplier view each other as an extension of each others firm. no end
date is set for their partnership
what are the characteristics that differentiate between having a partnership relationship with a
supplier and having a traditional contracting relationship? - Answer✔- early supplier
involvement
- no tender process or win-lose negotiations
- shared costs and benefits
- greater levels of information sharing and transparency
- joint performance measurement and KPIs
- no defined end period
1
, ©JASONMcCONNELL 2025 ALL RIGHTS RESERVED
- less contractual
what are some possible drivers for partnership sourcing? - Answer✔- working together will
generate synergies which are likely to result in reduced costs and increased profitability
- product life cycles have reduced in recent decades, which has created the need for businesses
to develop products more quickly
- changes in the marketplace or unstable markets may result in buyers and suppliers needing to
work together more closely in order to survive
- there may be a need to improve performance to satisfy the ultimate customer in the supply
chain
- the desire to reduce stock-holding and to move towards world-class standards of supply chain
management
what is a product life cycle? - Answer✔a period of time which involves developing a product
from scratch, bringing the product to the marketplace, sales in the market and the eventual
decline and removal of the product from the marketplace
what is vertical integration? - Answer✔when a buyer owns companies within its supply chain.
there could be forward vertical integration where a buyer owns a distributor, or backward
vertical integration where a buyer owns one of its suppliers of raw materials
what are the joint advantages of partnership? - Answer✔- working together and collaborating is
likely to result in synergies which could bring reduced costs and increased profitability for both
partners
- investment costs, such as new machinery and research and development can be shared by
both partners
- partnership can lead to improved competitive advantage and/or increased market share.
these are both likely to generate increased profits
what are the partnership advantages for the buyer? - Answer✔- as partnership relationships
are generally long term, the buyer is likely to be able to gain price stability from the supplier.
this will aid in planning and financial management
2
CIPS L4M6 LO3 Exam Questions and
Answers 100% Pass
What is type 1 of partnership? - Answer✔the organisations recognise each other as partners
and co-ordinate activities and planning on a limited basis. the partnership has a short-term
focus and involves only one function within each organisation. partnerships of this type are less
time intensive to develop
what is type 2 of partnership? - Answer✔both companies progress beyond co-ordination of
activities to integration. the partnership has a long-term focus and a number of functions within
both companies are involved
what is type 3 of partnership? - Answer✔the companies share a significant level of operational
integration. the buyer and supplier view each other as an extension of each others firm. no end
date is set for their partnership
what are the characteristics that differentiate between having a partnership relationship with a
supplier and having a traditional contracting relationship? - Answer✔- early supplier
involvement
- no tender process or win-lose negotiations
- shared costs and benefits
- greater levels of information sharing and transparency
- joint performance measurement and KPIs
- no defined end period
1
, ©JASONMcCONNELL 2025 ALL RIGHTS RESERVED
- less contractual
what are some possible drivers for partnership sourcing? - Answer✔- working together will
generate synergies which are likely to result in reduced costs and increased profitability
- product life cycles have reduced in recent decades, which has created the need for businesses
to develop products more quickly
- changes in the marketplace or unstable markets may result in buyers and suppliers needing to
work together more closely in order to survive
- there may be a need to improve performance to satisfy the ultimate customer in the supply
chain
- the desire to reduce stock-holding and to move towards world-class standards of supply chain
management
what is a product life cycle? - Answer✔a period of time which involves developing a product
from scratch, bringing the product to the marketplace, sales in the market and the eventual
decline and removal of the product from the marketplace
what is vertical integration? - Answer✔when a buyer owns companies within its supply chain.
there could be forward vertical integration where a buyer owns a distributor, or backward
vertical integration where a buyer owns one of its suppliers of raw materials
what are the joint advantages of partnership? - Answer✔- working together and collaborating is
likely to result in synergies which could bring reduced costs and increased profitability for both
partners
- investment costs, such as new machinery and research and development can be shared by
both partners
- partnership can lead to improved competitive advantage and/or increased market share.
these are both likely to generate increased profits
what are the partnership advantages for the buyer? - Answer✔- as partnership relationships
are generally long term, the buyer is likely to be able to gain price stability from the supplier.
this will aid in planning and financial management
2
