Why Is It Beneficial for a Firm to Use a Contract

question 41

Essay

Why is it beneficial for a firm to use a contract manufacturer or contract service provider? Provide at least one example of a firm that uses a contract provider and the benefit experienced because of this.

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Definitions:

Fiduciary Duty

The legal obligation of one party to act in the best interest of another when entrusted with care of money or property.

Utmost Good Faith

A legal doctrine requiring all parties to a contract, especially in insurance, to act honestly and disclose all relevant facts.

Business's Reputation

A business's reputation is the public perception or regard for a company, significantly influencing its success by affecting customer trust and loyalty.

Agency-by-Necessity

A situation in which one party (the agent) is empowered to act for another party (the principal) under emergency circumstances, without prior authorization.