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CIPS L5M10 Exam (page: 2)
CIPS Logistics Management
Updated on: 19-Feb-2026

Viewing Page 2 of 12
L5M10 PDF 88 Questions

Cleo Manufacturing has introduced a new Electronic Data Interchange (EDI) system.
Which of the following is an advantage of using this technology?

  1. It replaces emails
  2. It allows humans to check the work for accuracy
  3. It is cheap to introduce
  4. It simplifies the supply chain

Answer(s): A

Explanation:

Comprehensive and Detailed Explanation From Exact Extract:

EDI automates structured, computer-to-computer exchange of business documents (e.g., POs, ASNs, invoices), replacing manual, error-prone channels such as emails and paper and reducing rekeying/latency. It typically requires investment and integration effort; it does not remove the underlying supply chain complexity, and by design reduces--not adds--manual human checking.


Reference:

CIPS L5M10 Study Guide, EDI--purpose and benefits, p. 81



What is the name of the type of barcode that uses 12 numeric digits and is typically used for tracking items in store?

  1. UPC
  2. QR Code
  3. PDF417
  4. Aztec Code

Answer(s): A

Explanation:

Comprehensive and Detailed Explanation From Exact Extract:

UPC (Universal Product Code) is a linear barcode symbology using 12 numeric digits, widely used in retail point-of-sale and in-store item identification. QR, PDF417, and Aztec are different symbologies (2D or stacked) with different use cases and data capacities.


Reference:

CIPS L5M10 Study Guide, Barcode types overview, pp. 75­76



Oracle and SAP are examples of which type of system?

  1. MRP
  2. ERP
  3. SCM
  4. JIT

Answer(s): B

Explanation:

Comprehensive and Detailed Explanation From Exact Extract:

Enterprise Resource Planning (ERP) platforms integrate multiple enterprise functions (e.g., finance, procurement/supply, manufacturing, HR, customer service) into a single system and database. Oracle and SAP are cited as leading ERP vendors.


Reference:

CIPS L5M10 Study Guide, ERP overview and scope, p. 73)



The "Net Promoter Score" (NPS) provides a company with an indication of customer satisfaction by answering which question?

  1. How happy are you with the service delivered?
  2. Would you use this service again?
  3. On a scale of 1­10 did you find the service value for money?
  4. How likely are you to recommend the service to a friend?

Answer(s): D

Explanation:

Comprehensive and Detailed Explanation From Exact Extract:

NPS is a single-question metric asking customers how likely they are to recommend the product/service to others (typically on a 0­10 scale). It is widely used as a proxy for loyalty and satisfaction.


Reference:

CIPS L5M10 Study Guide, customer satisfaction measures--NPS, p. 62



Green Frog Ltd is a consultancy with ~50 customers. The CEO plans to use a Cost-to-Serve (CTS) tool to understand customer profitability. Is this the right approach?

  1. Yes -- Cost to Serve will allow identification of unprofitable customers
  2. Yes -- it is expensive but provides high visibility
  3. No -- all customers are equally profitable if they pay the same rates
  4. No -- use Total Cost of Ownership (TCO) instead

Answer(s): A

Explanation:

Comprehensive and Detailed Explanation From Exact Extract:

Cost-to-Serve analyses end-to-end activities and resources consumed to serve specific customers or segments, exposing variation in profitability (e.g., delivery distance, visit frequency, handling complexity). It is appropriate for finding unprofitable customers. CTS is not inherently "expensive," and TCO focuses on lifecycle cost of acquiring/owning goods--not customer profitability.


Reference:

CIPS L5M10 Study Guide, Cost-to-Serve concept and uses, p. 61



In which circumstance does the supplier hold the power in negotiations?

  1. Low-value contract, high market risk
  2. High-value contract, low market risk
  3. Low-value contract, low market risk
  4. High-value contract, low market risk

Answer(s): A

Explanation:

Comprehensive and Detailed Explanation From Exact Extract:

The supplier positioning/power matrix shows supplier power increases when the buyer's spend is low (low value to the supplier) and market risk is high (limited alternatives, volatility). Buyer power is strongest with high contract value and low market risk.


Reference:

CIPS L5M10 Study Guide, Supplier Positioning Model and power dynamics, p. 71



Customer service levels can be measured using Service Level Agreements (SLAs).
Which of the following are "hard" measures typically found in an SLA? Select THREE

  1. Stock availability
  2. Seriousness of complaints
  3. First-time fix rate
  4. On-time delivery
  5. Level of customer satisfaction

Answer(s): A,C,D

Explanation:

Comprehensive and Detailed Explanation From Exact Extract:

"Hard" measures are objective, quantifiable performance indicators--typical logistics/service measures include stock availability, first-time fix rate, and on-time delivery. Measures such as complaint seriousness and perceived satisfaction are "soft" (more subjective) but still useful.


Reference:

CIPS L5M10 Study Guide, SLAs--hard vs soft measures, p. 60



"Logistics is the flow of goods along a supply chain." Is this sentence true?

  1. No -- logistics is the management of supply and demand along the supply chain
  2. Yes -- logistics is the flow of goods, but only downwards along the supply chain
  3. Yes, but logistics also includes the flow of intangible items such as information and knowledge
  4. No -- logistics is the management of suppliers

Answer(s): C

Explanation:

Comprehensive and Detailed Explanation From Exact Extract:

Logistics encompasses the efficient flow and storage of goods, services, and related information from origin to consumption. It is not limited to physical goods or one direction; information and knowledge flows are integral.


Reference:

CIPS L5M10 Study Guide, definition and scope of logistics, p. 3



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