Chapter 7--Supplier Evaluat

Chapter 7--Supplier Evaluat - 7-Supplier Evaluation and...

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7--Supplier Evaluation and Selection Key 1. Most purchasing experts will agree that there is only one best way to evaluate and select suppliers. FALSE 2. The degree of effort associated with supplier selection is inversely related to the importance of the required good or service. FALSE 3. Traditional purchasing groups increasingly anticipate rather than react to supplier selection needs. FALSE 4. The strategic or technical complexity of the purchase agreement does not influence the intensity of the information search. FALSE 5. A major source of information on potential supply sources comes from current or existing suppliers. TRUE 6. Using existing suppliers, because it is easier and quicker, is always the best long-term approach. FALSE 7. A preferred supplier status conveys immediate information about the supplier's overall performance and competency. TRUE Trade shows are seldom an ineffective way to gain exposure to a large number of suppliers at one time. False Supplier size does become a factor where one firm decides to leverage its purchases from one or a few suppliers True Purchasing from competitors may limit information sharing between the parties
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True Purchasers always want to select suppliers who are profitable and growing True Using third-party information can be a timely and effective way to gain insight into potential suppliers. True Local suppliers are more responsive to the buying firm's changing needs and can economically make frequent smaller deliveries A _____ is limited to a select group of suppliers who provide critical high value items to the firm partnered supplier 8. Maintaining a supplier database is particularly important in industries where technology changes rapidly. TRUE 9. One of the arguments against rotating buyers too frequently between product lines or types of purchases is that a buyer may lose the expertise built up over the years. TRUE 10. Suppliers seldom use trade journals to advertise their products or services. FALSE 11. Trade shows are an ineffective way to gain exposure to a large number of suppliers at one time. FALSE 12. Because of the volume and low quality of data, buyers seldom use the Internet to help locate potential sources that might qualify for further evaluation. FALSE 13. The popularity of JIT and quick replenishment systems favor using fewer local suppliers. FALSE 14. Supplier size does become a factor where one firm decides to leverage its purchases from one or a few suppliers. TRUE
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15. A buying firm frequently wants the seller to become more dependent on its business in order to garner lower prices. FALSE 16. A buyer has no greater influence even though it has a relative size advantage over the supplier or represents a larger share of the supplier's total business.
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