C_ARSUM Ariba Supplier Management Practice Question
Which of the following best describes the 'Preferred Supplier' status in SAP Ariba?
⚠ Common exam trap
Test-takers sometimes confuse 'Preferred Supplier' status with automatic contract creation or mandatory sole-sourcing rules, ignoring its true purpose as a guiding designation.
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
A designation for high-performing, approved vendors
Preferred Supplier status is a strategic designation used to guide internal users toward vendors that have been vetted for quality, performance, or strategic fit. By highlighting these suppliers in search results, the organization drives spend toward its most reliable partners, maximizing the value of its procurement contracts. This status is highly visible during the procurement process, helping to ensure that employees make purchasing decisions that align with corporate objectives and sustainability goals.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
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A status that grants the supplier exclusive rights
Why it's wrong here
Preferred status is an internal classification, not a legal contract granting exclusive rights. The supplier does not gain exclusivity; rather, internal buyers are simply encouraged to use them. The designation is about driving spend, not about changing the legal relationship or obligations between parties.
- ✓
A designation for high-performing, approved vendors
Why this is correct
Preferred supplier status is a strategic label given to vendors who meet specific performance or partnership criteria. It helps procurement organizations steer users toward these suppliers, ensuring that spend is concentrated with vendors who have proven their reliability and value to the enterprise over time.
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A mandatory requirement for all new suppliers
Why it's wrong here
Preferred status is optional and reserved for a subset of the supplier base. Forcing all suppliers to be preferred would render the designation meaningless, as it would no longer differentiate high-performing partners from the general population of vendors, thus failing to guide purchasing behavior effectively.
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A temporary status that resets every fiscal year
Why it's wrong here
While it can be reviewed annually, it is not automatically reset. Preferred status remains until the procurement department manually changes it or the underlying performance data triggers a re-evaluation, allowing for long-term strategic relationships to be recognized without constant administrative maintenance.
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Written and reviewed by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
Last reviewed September 2026 · checked against the official SAP exam blueprint
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