Level 0 exam — Purchasing & Supply Chain

Exam — fresh questions

12 fresh questions to validate fundamentals: key distinctions, global chain, CQT trade-offs and operational vocabulary.
Answer everything, then click Check: your score and explanations will appear.

0.1 · Discrimination

1. Which distinction best sums up purchasing vs procurement?

Purchasing = operational, procurement = strategic Purchasing = strategic (choose suppliers and terms), procurement = operational (order and follow up) Both are identical Purchasing = transport, procurement = accounting

Purchasing decides from whom and under what conditions to buy (medium/long term), procurement executes daily within that framework.

0.1 · Application

2. In a small company, one person wears all three hats. What is the most frequent mistake?

Neglecting accounting Ordering too little Refusing any logistics Neglecting the strategic purchasing hat in favour of daily urgency

Operational urgency crushes purchasing work (benchmarking, renegotiating), yet the most profitable: you need protected dedicated time.

0.1 · Synthesis

3. What are the three flows the supply chain synchronises?

Forecast, production and after-sales Physical, information and financial Purchasing, sales and marketing Air, sea and road

Physical (goods), information (orders, forecasts) and financial (invoices, payments) must align.

0.2 · Discrimination

4. What do upstream and downstream mean in a supply chain?

Upstream = stock, downstream = transport They are synonyms Upstream = customers, downstream = suppliers Upstream = supplier side (before), downstream = customer side (after)

Upstream is supplier side, downstream customer side; physical goes downstream, money goes upstream.

0.2 · Application

5. A store sees +10% demand and orders +20% as a precaution. Which phenomenon does this amplification upstream illustrate?

Bullwhip effect Just-in-time Free carriage TCO

Without information sharing, each link adds its safety margin and amplifies variation: that's the bullwhip effect.

0.2 · Choice

6. To reduce the bullwhip effect, which action is most effective?

Share forecasts and stock levels with partners Always order more Change supplier every month Keep forecasts secret

Performance is collective: sharing information smooths shocks, withholding it worsens them.

0.3 · Discrimination

7. What does total cost of ownership (TCO) include?

Price minus discount Only list price Price + transport + customs + stocks + poor quality + admin + risk Only transport

TCO adds all delivered costs; it often reverses ranking based on price alone.

0.3 · Scenario

8. A critical part that stops production is offered cheaper with twice the lead time. What to do?

Always choose the cheapest Favour lead-time reliability because stockout cost exceeds saving Flip a coin Buy both at random

On a critical purchase, reliability prevails: the cost of a stoppage far exceeds a few percent saving.

0.3 · Synthesis

9. What is the fourth dimension completing the cost-quality-time triangle?

Advertising Number of employees Colour Supplier risk

Risk (financial health, dependencies, location) has become central: a chain optimised only on costs is fragile.

0.4 · Application

10. In the purchasing cycle, which document contractually commits the order?

Informal email Invoice Purchase order (PO) Goods receipt

The PO formalises references, quantities, prices and lead times: it's the committing piece.

0.4 · Discrimination

11. What is lead time?

Warranty duration Manufacturing time alone Total time between order and availability (preparation + transport + customs + receipt) Payment time only

Lead time is end-to-end; it sizes stocks, not just supplier's announced time.

0.4 · Exclusion

12. Which is NOT a supplier reliability indicator?

SKU Service level OTIF (on time and complete) OTD (on time)

SKU is the item identifier (reference); OTD, OTIF and service level measure reliability.

What's next?

Score ≥ 80%: move on to Level 1 — V3 (needs, statement of work, sourcing, tendering and the order-receipt-invoicing cycle).
Score < 80%: re-read the explanations above — each one re-explains the concept (hats, chain, TCO, vocabulary) — then redo the 48h challenges of the 4 sections.