1⟩ What is Counter trading?
Counter trading offers cash poor countries and organizations greater access to the world markets by offering them an alternate method of acquiring goods.
Purchase Planner
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“Purchase Planner job related Frequently Asked Questions by expert members with experience in Purchase Planning. These questions and answers will help you strengthen your technical skills, prepare for the new job test and quickly revise the concepts”
32 Purchase Planner Questions And Answers
2⟩ Define benchmarking?
The continuous process of measuring a company's products, services, costs, and practices against those of competitors or organizations that display "best in class" achievements.
3⟩ Define two-step procurement?
A bidding procedure usually consisting of two competitive steps. Step one consists of a technical proposal for furnishing the product or service and the second step consists of a comparison of costs. Bidding then proceeds as in conventional sealed bid procedures.
4⟩ Which process can be used to determine a vendor's price reasonableness when lack of pricing information available?
When there is a lack of pricing information available to determine price reasonableness, a cost analysis could be performed to evaluate and verify a vendor's cost data and proposed profit.
5⟩ Why purchasing cards are so much popular nowadays?
Purchasing cards are a purchasing tool many progressive companies use to purchase and pay for low dollar purchases. Purchasing cards reduce the cost of doing business while preserving purchasing controls.
6⟩ Define life cycle costing?
Life cycle costing is the total cost of purchasing, operating, maintaining, supporting and disposing of a product.
7⟩ Is it proper to use term "and/or" in agreements?
The term "and/or" should not be used in agreements. Ambiguity arises when this term is used because of the many possible variations this term can create. It is more exact to use the terms "and" and "or" separately. The term "and" means both, the term "or" means either.
8⟩ Annual requirements contract to deliver file cabinets each month was issued. The contract did not say anything about who bears cost of uncrating and setting up cabinets in offices. The supplier has uncrated and set up cabinets first four months of contract. Now, supplier is refusing to uncrate and set up cabinets unless he can increase his price. Can I force supplier to continue to uncrate and set up cabinets in offices at same contract price?
The supplier has to uncrate and set up the cabinets at no additional cost as the supplier has shown by course of his performance during the first four months of the contract that his intention was to uncrate and set up the cabinets.
9⟩ Suppose if I would like to stop taking annual physical inventories. Is there an alternative to physical inventories?
You can use cycle counts on a cyclic schedule rather than taking physical inventories. The most effective cycle counts are those conducted on a daily basis.
10⟩ What is sealed bid?
The procurement process by which a bid is submitted in a sealed envelope to prevent disclosure of its contents before the deadline for the submission of all bids.
11⟩ What is bonded warehouse?
A warehouse operated under U.S. Customs supervision to store imported goods.
12⟩ How inventory turns calculated?
A method used to calculate inventory turns is to divide the average inventory level into the annual cost of goods.
13⟩ Is it important to track inventory turns?
Inventories represent a sizable investment for businesses. The higher the inventory turns, the lower the inventory carrying costs.
14⟩ When risk of loss pass to a buyer when goods are purchased FOB the buyer's plant?
Risk of loss passes to the buyer when the goods are delivered at the buyer's plant.
15⟩ What words "shall" and "may" mean?
The word shall denotes the imperative and the word may denotes the permissive.
16⟩ Tell me is a contract that does not state any particular quantity valid?
The Uniform Commercial Code (UCC) allows for the award of requirements contracts, which do not state any particular quantity. However, a requirements contract is only valid if the contract is awarded in "good faith." Sellers will normally ask for the contract to have an estimated quantity or a quantity range.
17⟩ Described disadvantaged business?
A small business which is owned or controlled by a majority of persons, not limited to members of minority groups, who have been deprived of the opportunity to develop and maintain a competitive position in the economy because of social disadvantages.
18⟩ Are the vendors bound by the requirements contracts awarded to two different vendors for the same set of requirements without disclosing this information to both vendors?
Requirements contracts must be awarded in good faith. In this case, the courts will determine that those contracts were executed in bad faith and neither vendor will be bound by their contract.
19⟩ What is Cost-Reimbursement contract?
Under this type of contract, a contractor is reimbursed for costs allowed under the contract terms.
20⟩ What is Reciprocal trading?
Reciprocal trading provides participating nations with equivalent competitive trading opportunities based on mutual agreements negotiated to adjust tariffs, duties, and customs restrictions in order to increase foreign trade and improve border-to-border relationships among participating countries.
