Certified Professional Public Buyer (CPPB) Practice Test

What is stockless purchasing?

1. An inventory method requiring regular stock checks

2. An approach where goods are purchased only as needed

3. A system where the organization is responsible for goods inventory

4. An arrangement where the organization has no responsibility for inventory

The correct answer is: An arrangement where the organization has no responsibility for inventory

Stockless purchasing refers to an arrangement where the responsibility for maintaining inventory levels and managing stock falls outside the organization itself, usually with a supplier or external partner. This approach allows the organization to operate without holding excess inventory on-site, thereby reducing storage costs, minimizing waste, and enhancing efficiency. By relying on suppliers to deliver goods just in time, stockless purchasing can streamline operations, as the focus shifts from managing stock levels to ensuring timely procurement based on actual demand. This strategy is beneficial for organizations looking to optimize their purchasing processes while avoiding the complexities associated with inventory management. The other choices present different inventory-related concepts, but they do not accurately define stockless purchasing. For instance, the option that describes an inventory method requiring regular stock checks focuses on traditional inventory management thought processes, which directly contrasts with the stockless approach. Similarly, the option regarding purchasing goods only as needed touches on a just-in-time philosophy but does not capture the essence of stockless purchasing specifically. The mention of an organization being responsible for goods inventory also misrepresents the fundamental principle of stockless purchasing.