CIPS L4M6 Practice Exams
Last updated on Oct 22,2026- Exam Code: L4M6
- Exam Name: Supplier Relationships
- Certification Provider: CIPS
- Latest update: Oct 22,2026
Andrew runs a factory that makes cakes. Vanilla Extract is a vital ingredient in Andrew’s cakes and this is a monopolistic market. Andrew has noticed recently that the quality of the supplier’s product has reduced, and this has led to several complaints from customers. Andrew is considering entering into a Partnership with this supplier as he believes this will help increase the supplier’s performance. Is this the correct thing to do?
- A . Yes- partnership sourcing can improve performance which will ultimately satisfy the end customer
- B . Yes- partnership sourcing will improve sales figures
- C . No- Andrew should use an alternative supplier
- D . No- Andrew should outsource the vanilla extract.
A
Explanation:
The correct answer is ‘Yes- partnership sourcing can improve performance which will ultimately satisfy the end customer’. The important thing to note in this QUESTIO N N O: is the word ‘monopolistic’. This means that there are no alternative suppliers- so the ‘no’ options are wrong-there are no alternative suppliers and no opportunity to outsource. The other answer is incorrect as sales figures isn’t Andrew’s concern C it’s the complaints and quality of the product. Improving performance to satisfy end customers is therefore his main driver for considering a Partnership. See p. 127 for more information on Drivers of Partnership Sourcing. This comes up a lot in the exam
Partnership sourcing is often considered a ‘high-risk’ strategy for a buyer.
Which of the following is not a risk generally associated with partnership sourcing?
- A . Sharing commercially sensitive data with another party
- B . Single-sourcing may leave the buyer without a supply if the supplier goes into liquidation
- C . Reduced waste in the supply chain
- D . Supplier may become complacent
C
Explanation:
The correct answer is ‘Reduced waste in the supply chain’ C this is not a risk, this is a benefit P.134
A partnership approach to a buyer-supplier relationship, as opposed to a traditional adversarial approach, would have which of the following characteristics?
- A . Greater levels of transparency
- B . Increased supplier contractual terms
- C . Specifications designed by the buyer
- D . Shared cost benefits
A, D
Explanation:
Partnerships are built on trust and transparency, with shared benefits such as cost reductions and improved processes. Adversarial relationships, in contrast, focus on price and contractual obligations.
In an oliogopy market, what would a regulator do?
- A . prevent price fixing and collusion
- B . stop the market becoming a monopoly
- C . ensure value for money for buyers
- D . ensure health and safety standards
A
Explanation:
In an oliogopy, supplier power is strong. Sometimes regulators are required in the market to prevent the group of suppliers conspiring together to artificially increase prices. See p.40 for more information on Oligopy markets.
Debbie is a procurement manager at a small manufacturer company. She had a contract in place with a company that provides uniforms, but finds that she doesn’t need to order much from them as the staff re-wear the same clothes to work. The contract has now expired.
Should Debbie do a Competitive Tender to source a new contract?
- A . Yes C the contract has now expired so she must do a new competitive tender
- B . Yes- competitive tender is the only option to procure uniforms
- C . No- the contract is not of significant value
- D . No- Debbie should continue using the same supplier- it doesn’t matter that the contract has expired.
C
Explanation:
The correct answer is ‘no-the contract is not of significant value’. CIPS state that competitive tenders should only be used when ‘the item or service is of significant value’ p.73. Debbie could continue using the same supplier, but she should organise a contract extension or a new contract if she does.
Which of the following are elements of a business that can develop a company’s competitive advantage? Select THREE.
- A . cost focus
- B . cost leadership
- C . human resource management
- D . organisation culture
- E . natural resources
C, D, E
Explanation:
This is one of those questions you have to read carefully- it asks for ‘elements of a business’. Cost focus and cost leadership are ways a company can improve their competitive advantage, but they’re not elements of a business. The other three options are. Porter created a list of elements of a business that can help a company’s competitive advantage- these can be found on p.33-34
A supplier is working with a buyer who represents a large percentage of his business. Without this particular buyer, the supplier would likely go out of business. There has been a dispute in the last invoice which the buyer is not happy about.
What technique should the supplier use when talking to the buyer about this?
- A . Competing- the supplier needs to earn more money as they are struggling financially
- B . Avoiding- the supplier should avoid talking with the buyer as this may result in conflict
- C . Accommodating- the supplier should show a large degree of co-cooperativeness as the buyer is important to their survival
- D . Accepting C the supplier should accept that conflict should sometimes occur in buyer: supplier relationships and work hard to avoid them
C
Explanation:
The correct answer is ‘accommodating’. This QUESTIO N N O: is based on the Thomas-Kilmann Conflict model on p.87. This comes up quite a bit in the exam. It is comprised of 5 techniques for dealing with conflict; competing, collaborating, compromising, avoiding and accommodating. In this instance, the supplier should have a high degree of co-cooperativeness and a low degree of assertiveness as the long-term relationship is very important- more important than the outcome of
the disputed invoice.
Which of the following would be benefits of partnership sourcing? Select TWO that apply.
- A . Reduction in inflation
- B . Reduction in costs
- C . No need for contracts
- D . Reduction in stakeholder numbers
- E . Continuity of supply
B, E
Explanation:
Partnership sourcing improves efficiency through cost reduction and ensures continuity of supply by fostering long-term, collaborative relationships with key suppliers, as highlighted in CIPS guidelines.
Why is it more difficult for buyers in the public sector to build relationships with suppliers?
- A . Buyer power is weak in the public sector
- B . Buyer power is strong in the public sector
- C . There are regulations prohibiting public sector buyers from developing relationships
- D . There are regulations that state competitive tender processes must be undertaken regularly
D
Explanation:
It can be difficult for buyers in the private sector to build relationships with suppliers because of rules that state competitive tenders must be undertaken every few years (within the EU this is usually every 4). This means that both parties aren’t as invested in developing the relationship as it’s possible the contact will end shortly. Competitive tendering is a requirement in the public sector to ensure value for money for taxpayers. See p.79 for further details. There are no rules stating Public Sector organisations can’t have good relationships with suppliers, and in fact most will have good relationships with their current suppliers- the issue is that neither party can get too invested in the relationship as everyone knows it may end shortly. There are rules, however, against entering into Partnership relationships (which is discussed in chapter 3).
Products or services that are more suitable for partnership sourcing match which of the following criteria?
- A . 1 and 2 only
- B . 2 and 3 only
- C . 1 and 3 only
- D . 2 and 4 only
A
Explanation:
Partnership sourcing is suitable for products that contribute to the buying organization’s unique selling point (USP) and for critical products on which key customers depend. This approach ensures strategic alignment and mutual benefits for both parties, focusing on collaboration rather than cost alone.