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CIPS L5M6 Exam Syllabus Topics:

Topic	Details
Topic 1	Understand the Concepts, Tools, and Techniques Associated with Managing Expenditure: This section of the exam measures the analytical abilities of a Category Analyst and focuses on expenditure management techniques within category management. It explores how organizations identify, classify, and analyze different types of spend to enhance procurement efficiency and value creation.
Topic 2	Understand Approaches that Can Be Used to Develop Category Management Strategies: This section of the exam measures the skills of Procurement Managers and focuses on understanding how category management strategies are formulated within procurement functions. Candidates are expected to differentiate between strategic and conventional sourcing, evaluate how these approaches support long-term supplier relationships, and align them with organizational goals. The section also emphasizes the role of category management in enhancing sourcing efficiency and achieving cost optimization.
Topic 3	Understand the Strategic Impact of a Category Management Process: This section evaluates the strategic insight of a Procurement Manager into how category management influences organizational performance. It explores the use of data-driven decision-making and market intelligence to shape sourcing strategies and drive sustainable procurement outcomes.

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Free PDF Quiz 2025 L5M6: The Best Test Category Management Questions Vce

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CIPS Category Management Sample Questions (Q65-Q70):

NEW QUESTION # 65
Jonah is a Procurement Specialist responsible for a sub-category of work which includes procuring skilled labour for construction. Sub-categories can also be known as what within a Category?

A. Sets
B. Commodities
C. Lots
D. Divisions

Answer: B

Explanation:
Within Category Management, sub-categories are often referred to as commodities. These are narrower groupings within a category that focus on specific goods or services. For example, within the Construction category, commodities might include raw materials, subcontracted labour, or specialist equipment hire.
Recognising commodities helps procurement apply tailored strategies that address their specific market dynamics and risk profiles. It also provides clarity when developing category plans, as different commodities may require different sourcing and supplier management approaches. By managing at both category and commodity levels, organisations can strike a balance between broad strategic alignment and detailed tactical execution.
Reference: CIPS L5M6 Study Guide, p.52

NEW QUESTION # 66
ABC Ltd is a manufacturer of hi-tech IT equipment in an industry set to grow substantially over the next 10 years. What type of industry is this?

A. Dog industry
B. Bear industry
C. Bull industry
D. Cow industry

Answer: C

Explanation:
A Bull Industry is one that is experiencing strong growth, with positive demand and market expansion expected in the future. In financial terms, "bull" markets are characterised by optimism, rising investment, and business confidence.
For ABC Ltd, operating in a high-growth IT sector, this categorisation is appropriate because demand is projected to increase. This means opportunities exist for innovation, supplier partnerships, and long-term strategic sourcing.
By contrast:
* Bear industries represent declining markets, where firms face shrinking demand.
* Dog and Cow industries are not recognised terms within category management; they are distractors in this question.
Identifying whether an industry is in a bull or bear phase helps Category Managers assess market risks, supplier relationships, and investment priorities.
[Ref: CIPS L5M6 Study Guide, p.150 - Market classifications: bull vs bear industries]

NEW QUESTION # 67
What name is given to an item or business which has both low market share and low growth?

A. Question mark
B. Dog
C. Star
D. Cash cow

Answer: B

Explanation:
In the BCG Growth-Share Matrix, a dog is a business unit or product that has both a low relative market share and a low growth rate. Such items typically generate low or no profits and are often seen as candidates for divestment or discontinuation. Unlike cash cows which generate strong cash flow despite slow growth, or stars which dominate high-growth markets, dogs occupy a weak position in the portfolio. Managing these categories strategically is critical because maintaining them often consumes more resources than the value they return. Organisations need to assess whether retaining these products provides any strategic advantage, such as complementing other offerings, or whether resources should be reallocated. This is why category managers use tools like the BCG Matrix to evaluate the positioning of spend categories and align them with organisational strategy.
Reference: CIPS L5M6 Study Guide, p.117

NEW QUESTION # 68
What is a 'black swan' event?

A. An event that is random or unexpected
B. A regularly occurring event
C. An event that is planned for meticulously in advance
D. An event that brings about a negative outcome

Answer: A

Explanation:
A black swan event is an unexpected and rare occurrence with significant impact. Examples include the 2013 horse meat scandal in the food industry, which was unforeseen and highly disruptive.
Reference: CIPS L5M6 Study Guide, p.104

NEW QUESTION # 69
The sale of ice-cream, bikinis and sunglasses usually follows which demand pattern?

A. Growth
B. Stable
C. Decline
D. Cyclical

Answer: D

Explanation:
These items follow a cyclical demand pattern, meaning that sales fluctuate in predictable cycles-typically aligned with seasons or climate conditions. For example, demand peaks in summer and falls sharply in winter. Recognising cyclical patterns allows procurement professionals to plan supply and inventory effectively, avoiding both shortages during peak demand and excess stock during low demand periods. This type of forecasting is particularly important in industries such as fashion, tourism, and consumer goods.
Failing to account for cyclical demand can lead to missed sales opportunities or increased storage costs. In category management, understanding demand cycles ensures efficient resource allocation, supplier scheduling, and financial planning. It also supports collaborative planning with suppliers to ensure capacity aligns with market needs.
Reference: CIPS L5M6 Study Guide, p.143

NEW QUESTION # 70
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