Exam L4M4 Topic 2 Question 112 Discussion

Actual exam question for CIPS's L4M4 exam
Question #: 112
Topic #: 2
One approach to managing supply risk is by having multiple suppliers of a given product or category of requirements. This approach has both advantages and disadvantages. Which of the following conditions would be a reason for multiple sourcing arrangements?

Suggested Answer: C Vote an answer

Multiple sourcing is most effective for strategically important, high-value requirements such as raw materials.
These are continuous, large-volume needs where supply disruptions can be costly and damaging. By using more than one supplier, buyers reduce dependency risks, improve resilience, and increase competitive leverage. One-off requirements like machinery (A) don't benefit from multiple sourcing, while options B and D describe disadvantages rather than reasons for adopting the approach. Responsible sourcing promotes balancing cost, risk, and resilience - and multiple sourcing is a key strategy for critical, ongoing supply categories.
Reference: CIPS L4M4 Study Guide (v2), LO: "Application" - sourcing strategies and risk management.

by Leo at May 12, 2026, 03:12 AM

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