Certified Professional Public Buyer (CPPB) Practice Test

In inventory management, which of the following is related to stockless purchasing?

1. Long-term discounts

2. Just-in-time inventory delivery

3. Bulk ordering

4. Excess stock holding

The correct answer is: Just-in-time inventory delivery

Stockless purchasing refers to a purchasing strategy where inventory is minimized or eliminated by scheduling deliveries of materials just as they are needed in the production process. This approach significantly reduces the costs associated with holding and storing inventory. Just-in-time inventory delivery is aligned with the principles of stockless purchasing because it emphasizes receiving goods right before they are needed rather than maintaining large amounts of stock on hand. This method helps organizations decrease storage costs, reduce waste, and improve efficiency by ensuring that materials are available at the precise moment they are required, thus supporting the stockless purchasing model. In contrast, long-term discounts, bulk ordering, and excess stock holding promote retaining larger quantities of inventory and can lead to increased carrying costs. These approaches often focus on obtaining price advantages at the cost of having to manage and store large inventories, which is counter to the goal of stockless purchasing.