Certified Supply Chain Professional (CSCP) Practice Exam

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Study for the Certified Supply Chain Professional (CSCP) Practice Exam. Prepare with multiple choice questions, each accompanied by hints and explanations. Get ready to ace your exam!

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What is meant by sole source in procurement?

Multiple suppliers for the same product
Only one organization can provide a product
Suppliers offering the same product at different prices
None of the above

The correct answer is: Only one organization can provide a product

In procurement, the term "sole source" refers to a situation where only one organization can provide a specific product or service. This can occur due to various reasons such as the uniqueness of the product, proprietary technology, or legal rights that limit supply options. By having only one source, the procuring organization does not have the ability to choose among different suppliers, which can affect pricing and availability. Understanding the implications of sole source procurement is crucial for supply chain professionals, as it can lead to higher risks associated with supply continuity and dependency on a single supplier. This concept contrasts with scenarios where multiple suppliers exist, which allows for competition and alternatives.