APICS Certified Supply Chain Professional (CSCP) — Question 148

A company currently produces a major component and is considering purchasing the component from a foreign supplier. Assuming they were to purchase from the foreign supplier, which of the following would most likely impact the domestic manufacturing operations?

Answer options

• A. Direct cost of the component
• B. Supplier lead time fluctuations
• C. Accuracy of supplier forecasting
• D. Transportation cost from the supplier

Correct answer: B

Explanation

Choosing to purchase from a foreign supplier introduces uncertainties related to lead times, which can disrupt domestic manufacturing schedules. While direct costs, forecasting accuracy, and transportation costs are important, lead time fluctuations have a more immediate and direct effect on production operations and planning.