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L5M6 Category Management

  • CIPS
  • 5 free sample questions

About this exam

L5M6 is the CIPS exam Category Management. Paid practice material for this exam is not available yet, but you can try its free sample questions.

Exam code
L5M6
Vendor
CIPS
Practice questions
Not available yet
Free sample questions
5
Question bank last updated
Not available yet

Try 2 sample questions

Taken from the free sample set for L5M6.

Question 1

In Category Management, which is the best way to group materials and/or services?

  1. Option A:

    Usage characteristic


  2. Option B:

    Spend category


  3. Option C:

    Geography of supply


  4. Option D:

    Supplier relationship

Show answer and explanation

Correct answer: A

In category management, grouping is most effective when based on similar usage characteristics . This means materials or services are categorised by how they are used within the organisation, rather than simply by spend or supplier. For example, in healthcare, personal protective equipment (PPE) forms one category, while surgical instruments or bedding may be separate categories. This approach ensures that category managers have a clear understanding of functional requirements, demand patterns, and value drivers. Grouping only by spend might overlook strategic importance, while grouping by supplier or geography can miss opportunities for cross-functional efficiencies. Usage-based categorisation allows for tailored procurement strategies that align with business objectives and ensure effective stakeholder engagement. It also enables organisations to identify synergies across business units and improve supplier management. By aligning categories to organisational needs rather than just financial or structural dimensions, procurement creates more value and achieves better alignment with corporate strategy.

[Reference: CIPS L5M6 Study Guide, p.48, , ]

Question 2

Joe is a Category Manager at an automobile company. Which of the following would be the best way to decide on categories in this industry?

  1. Option A:

    Alphabetically

  2. Option B:

    By spend


  3. Option C:

    By supplier


  4. Option D:

    By part

Show answer and explanation

Correct answer: D

In the automobile industry, the most logical method for structuring categories is by part . Large manufacturing organisations, such as Ford or Toyota, procure thousands of parts and materials from hundreds of suppliers. To manage this complexity effectively, they segment procurement responsibilities into categories such as engines, tyres, glass, electronics, or body frames. This allows Category Managers to develop deep expertise in their assigned areas, improving supplier relationships and value delivery.

Other approaches are less effective:

    Alphabetical categorisation is impractical and arbitrary, providing no strategic value.

    By spend creates imbalances, as high-value categories would attract disproportionate workload and risk, leaving others underrepresented.

    By supplier could lead to inefficiency and over-fragmentation, as suppliers often provide multiple types of products.

The study guide stresses that categorisation must allow procurement teams to be efficient, balanced, and capable of strategic focus. By organising categories by part , managers can align more closely with engineering and production needs, ensuring better cross-functional collaboration.

[Ref: CIPS L5M6 Study Guide, p.3 – Defining categories in Category Management]

See all 5 free sample questions