L4M3 practice question 15 of 25

Which of the following is the term that describes an item bought for a single and non-recurring use or purpose?

Full set: 258 questions
Answer options
A: Call-off purchase
B: Ad-hoc purchase Correct answer
C: Operational purchase
D: Stock purchase
Correct Answer:
B. Ad-hoc purchase
Explanation

An ad-hoc purchase is a one-time procurement made for a specific, non-recurring, and often unforeseen need. The term 'ad hoc' is Latin for 'for this purpose,' which perfectly describes a purchase that is not part of a routine or planned procurement cycle. These purchases are typically reactive, addressing an immediate requirement that falls outside of regular stock replenishment or contractual agreements. They are distinct from systematic purchasing methods used for ongoing operational needs.

Why Incorrect

A. Call-off purchase: This is an order placed against an existing framework agreement or blanket order for recurring requirements.
C. Operational purchase: This is a broad category for goods and services needed for daily business functions, which are often recurring.
D. Stock purchase: This refers to buying items to be held in inventory to meet future, anticipated demand, not for a single use.

References

1. Chartered Institute of Procurement & Supply (CIPS). (2019). Commercial Contracting (L4M3). Profex Publishing. In the context of sourcing and contract types, the guide distinguishes between planned, strategic procurement and reactive, ad-hoc purchasing for unique, non-recurrent needs (Section 2.1: Different sourcing methodologies).

2. Lysons, K., & Farrington, B. (2020). Procurement and Supply Chain Management (10th ed.). Pearson. Chapter 6, "Sourcing," discusses different purchasing situations, defining ad-hoc or 'spot' buying as transactions for immediate, non-recurring requirements, contrasting them with system or stock contracts (pp. 185-187).

3. van Weele, A. J. (2018). Purchasing and Supply Chain Management (7th ed.). Cengage Learning. The text differentiates purchasing situations based on the nature of the product and market. Ad-hoc purchases are classified under 'leverage' or 'non-critical' quadrants of the purchasing portfolio matrix, often characterized by their one-off nature (Chapter 4, Section 4.5: The Purchasing Portfolio Matrix).

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