Supply Chain Professional CSCP Reddit Questions

Entering into annual contracts with key suppliers based on forecasts typically allows a company to negotiate better pricing due to the guaranteed volume over a set period. Suppliers are more likely to offer discounts and favorable terms when they have a predictable and steady demand. This approach can also lead to cost savings from bulk purchasing and long-term relationships, contributing to lower procurement costs. While shorter delivery lead times, improved service, and higher-quality products are potential benefits, the most direct and likely benefit from this approach is lower prices.

References:

• Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2020). Purchasing and Supply Chain Management. Cengage Learning.
• Burt, D. N., Petcavage, S., & Pinkerton, R. (2010). Supply Management. McGraw-Hill Education.

Providing support and service for proper product use can reduce the number of goods processed by the reverse supply chain by minimizing the likelihood of returns due to misuse or lack of understanding. Educating customers on how to use products correctly, offering troubleshooting assistance, and ensuring they have the necessary support can lead to higher satisfaction and fewer returns. Options A, B, and C are related to reverse logistics but do not directly address the prevention of returns through better customer support and service.

References:

• Guide, V. D. R., & Van Wassenhove, L. N. (2009). The Evolution of Closed-Loop Supply Chain Research.
• https://www.supplychainbrain.com

The condition most indicative of a company that is effectively managing its cash is low accounts receivable, low inventory, and high accounts payable. Here’s why:

• Accounts Receivable (AR):
• Inventory:
• Accounts Payable (AP):

By effectively managing these three areas, a company can ensure a positive cash flow, maintain liquidity, and enhance its overall financial health.

References

• Brigham, E. F., & Houston, J. F. (2018). Fundamentals of Financial Management.
• Ross, S. A., Westerfield, R. W., & Jordan, B. D. (2016). Corporate Finance: Core Principles and Applications.

E-commerce enabled supply chains are designed to fulfill individual consumer orders, which are typically smaller in size compared to traditional bulk shipments to retailers. The nature of e-commerce requires efficient handling, packaging, and shipping of numerous small packages directly to customers' addresses. This makes parcel shipments a key characteristic of e-commerce supply chains. These parcel shipments are often managed through sophisticated logistics networks that can handle high volumes of small packages and provide quick delivery times.

• Push system (A) is more associated with traditional retail supply chains where products are pushed to stores based on anticipated demand.
• Small number of niche customers (C) is not typically associated with e-commerce, which often aims for a broader market.
• Fewer reverse logistics activities (D) is not accurate as e-commerce tends to have a higher rate of returns and requires robust reverse logistics capabilities.

References

• Chopra, S., & Meindl, P. (2016). Supply Chain Management: Strategy, Planning, and Operation. Pearson.
• Christopher, M. (2016). Logistics & Supply Chain Management. Pearson.