CIPS L4M5 Commercial Negotiation Online Training
CIPS L4M5 Online Training
The questions for L4M5 were last updated at May 09,2025.
- Exam Code: L4M5
- Exam Name: Commercial Negotiation
- Certification Provider: CIPS
- Latest update: May 09,2025
Premium pricing strategies used by suppliers are characterised by which of the following? Select TWO that apply.
- A . Products are charged at a price based on supplier’s reputation
- B . This strategy is often used when supplier attempts to enter new market
- C . Price is based on cost structures
- D . Typically found in the early part of the product life cycle
- E . Premium price is determined by variable costs only
A purchasing manager is having a negotiation with a supplier to extend the duration of the contract. In order to persuade the supplier to cut the cost by 10%, she promises to shorten the payment period from 45 days to 30 days for each delivery. The supplier’s representative does not agree the offer and clearly states that his proposed price is already lower than the market price.
The purchasing manager has used which type of power?
- A . Reward
- B . Expertise
- C . Coercive
- D . Informational
According to Professor Gavin Kennedy, in which of the following forms of dispute resolution, both parties will voluntarily exchange their ideas and beliefs?
- A . Litigation
- B . Persuasion
- C . Negotiation
- D . Gambling
Sumitomo Rubber Industries (SRI) is a Japan-based tyre manufacturer. In order to increase production, SRI is sourcing rubber from Southeast Asian firms.
Which of the following micro factors are most likely to shift the balance of power to supplier? Select TWO that apply
- A . SRI’s purchase amount makes significant proportion of supplier revenue
- B . Costs of changing suppliers are high
- C . Rubber from different suppliers is virtually similar
- D . SRI sets up its own rubber plantation
- E . There are no close substitutes for rubber
Which of the following are most likely to be sources of conflict that can emerge from the process of commercial negotiations? Select TWO that apply.
- A . Differences in conflict management style
- B . Differences in culture
- C . Types of purchase
- D . Standard terms and conditions
- E . Line of the best fits
In airline industry, suppliers prefer to adopt dynamic pricing in order to constantly monitor and change their fares in response to market conditions. Dynamics pricing is based on which costing method?
- A . Activity-based costing
- B . Cost plus costing
- C . Absorption costing
- D . Marginal costing
The trust is built based on the other party’s professional qualifications or proven or certified technical capability or experience is known as…?
- A . Goodwill trust
- B . Contractual trust
- C . Irrevocable Trust
- D . Competence trust
Can a party gain huge advantages in negotiation from setting room layout?
- A . Yes, because the host can freely manipulate the other party’s mind through setting room layout
- B . No, because the advantages gained from manipulating room layout are short-lived
- C . Yes, because the other party can capitulate to the host
- D . No, because room layout contributes nothing to the negotiation outcomes
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