Certified Professional Public Buyer (CPPB) Practice Test

What does the supply positioning matrix illustrate?

1. Market share of different suppliers

2. Supply and demand trends over time

3. The supply continuum and procurement strategies

4. Financial forecasts for procurement needs

The correct answer is: The supply continuum and procurement strategies

The supply positioning matrix is a valuable tool in procurement and supply chain management. It illustrates the supply continuum and connects various procurement strategies to different categories of goods or services. The matrix typically consists of two axes: one representing the complexity of the supply market and the other the importance of the product or service to the organization. This framework allows organizations to assess how to approach their procurement strategy based on the specific characteristics of the supply market and the strategic importance of the items they are purchasing. By using the supply positioning matrix, procurement professionals can develop tailored strategies, ranging from collaborative partnerships for strategic items to more transactional approaches for routine purchases. This insight is essential for effective decision-making, helping organizations optimize their supply chain management and mitigate risks associated with procurement. The other choices, while related to aspects of procurement and supply chain considerations, do not capture the essence of the supply positioning matrix as specifically as the correct choice does. For instance, market share analysis, trend forecasting, and financial forecasting, while important, do not directly relate to the specific strategic insights provided by the supply positioning matrix.