CORE Exam Dumps : Supply Management Core Exam

Initial Bids Review: Evaluate the bids submitted by the suppliers ($110,000, $114,000, and $135,000).

Lowest Bid Consideration: The lowest initial bid of $110,000 should be the baseline because it represents the market's competitive price before any negotiation.

Calculate Cost Avoidance: After negotiations, the final cost is $105,000. The cost avoidance is calculated against the $110,000 baseline, showing the savings achieved through negotiation.

References

Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2016). Purchasing and Supply Chain Management. Cengage Learning.

Burt, D. N., Petcavage, S. D., & Pinkerton, R. L. (2010). Supply Management. McGraw-Hill Education.

Item cost: $0.76

Packaging for shipment: $0.02

Shipping from Indonesia: $0.14

Duty: $0.03

Customs clearance: $0.10

Storage at buyer’s warehouse: $0.09

Shipment from warehouse to plant: $0.06

Calculate the total landed cost per unit: Sum of all the costs.

Total Landed Cost = $0.76 + $0.02 + $0.14 + $0.03 + $0.10 + $0.09 + $0.06 = $1.20

References

CIPS. (n.d.). Understanding Total Landed Cost in Procurement.

ISM. (n.d.). Calculating Total Landed Cost for Procurement Decisions.

] Understand the Need: DEF, Inc. needs to find local sources for materials and equipment in a new geographic region.

Initial Information Gathering:

An RFI is used to collect information about potential suppliers' capabilities, offerings, and market conditions.

This step helps in understanding the supplier landscape and identifying potential suppliers.

Evaluate Responses: Analyze the information gathered from the RFI to shortlist suppliers for further engagement.

Subsequent Steps: Based on RFI responses, the company can issue RFQs or RFPs to procure the required materials and equipment. References:

Procurement and Sourcing Best Practices

Supplier Selection and Evaluation Processes

Strategic Sourcing Frameworks