Sample Paper on Acme Fireworks firm’s viability to expand its supply of fireworks

Final Paper


The researcher seeks to undertake in-depth analysis of the Acme Fireworks firm’s viability to expand its supply of fireworks based on the increased demand of its product. The paper is coined to help unearth limitations on legal, social and economic terms of the proprietor to engage in this new lucrative but tricky contract. The firm is faced with several mishaps ranging from inadequacy of employees, equipment as well as capital. Besides, proposed unforeseen contracts have not properly been analyzed. Engagement in contracts call for a rational thought as it is a bureaucratic procedure that stretches beyond a mere price determination as the sole benchmark.

It is against these shortfalls that, the manager is disturbed and consequently has vowed to put things straight despite the owner’s earlier arrangements. Success-oriented firms are rated based on their ability to remain relevant in the industry for a long term projection. Short run projects and transaction might prove attractive but, top management of organization must ensure the best interest of their firms is projected against all odds. A critical examination of firm’s assets verses liabilities are some of the top criterion upon which engagement into new investments are embedded.

Besides such restrictions, legal terms are not compromised as firms are always licensed to operate under some specific and well defined boundaries. A firm that does not obey the existing business laws stands to lose its investment when brought to book. It is therefore, advantageous for firms to strictly operate within their territorial boundaries with respect to legal issues. A manager should thus be at par with such laws before engaging into any contracts so as to avoid the firm’s forced operation termination. The investigator will thus analyze the current status of the company based on kind of entity, its legal limitations as well as financial viability to engage in the proposed contracts. A decision stands to be arrived at based on such revelations.


Personnel Liability for Injury to Consumers

This section seeks to unearth the possible laws and penalties associated with productions and distribution of defective products to consumers and businesses using the products at workplaces. This is provided for in the Consumer Protection Act which spells out laws regarding defects with respect to manufacturing, distribution, warning as well as design. Consumers should be properly warned on the particular precautions adhered to during the use of products. Design defects arise if the products are made in a way that is user unfriendly and prone to risks. Manufacturing defects will occur on the manner a product is made resulting from use of poor quality resources as well as questionable workmanship.

Fireworks products are prone to physical injuries as they are always exposed to defects. The proprietor may as well be dealt a blow of manufacturing defects based on poor workmanship as they may be tempted to increase production to serve all the buyers without remaining focused on the quality of their products attached to negligence leading defections (Furmston, Tolhurst & Mik, 2010, p.176). There are dissenting argument based on the personal injuries a product may cause as to whether categorized under strict liability or negligence.

With respect to product injury based on negligence case, the plaintiff must prove that reasonable care was not considered by manufacturer resulting from material selection, warning, design, making and testing the product.  One will only win such cases involving consumer product after showing that his injury was directly caused by manufacturer’s failure to reasonably design or warn his consumers. Manufacturers have to take much reasonable care as they can be sued even if the initial buyer is not the one injured. For instance, when proprietor sells to these retail shops that further sell to buyers, consumers will still sue the sole proprietor.

Strict liability is now being used over negligence as reasonable care is relative to other manufacturers’ products making plaintiff to lose such cases. With respect to strict liability, the injured are relieved from showing lack of reasonable care by the manufacturing but only showcase that he was injured by the product. Manufacturing firms are thus left defenseless regardless of the extent to which reasonable care was considered. A breech of warrant is also on the current scene, applicable in circumstance arising from dishonest advertisements making products to perform way much below consumers’ expectations as well as products own source of defection.

Consumer Protection Act has extended its scope to incorporate transactions between businesses and not only to those affected to consumers where such commodities are used at workplaces. To relate these revelations to this context, the firm is dangerously exposed to personal liabilities based on the various commodities produced which are also attached to diverse usage (Furmston, Tolhurst & Mik, 2010, p. 198). Besides, the expansion the Company by engaging into manufacturing is distribution of such large orders as framed in the currently crooked contracts wills results into much exposure to personal liability for transactions between these businesses.

Previously conducted researches reveal shocking issues circumventing around the injuries and their associated cases of deaths with respect to firework products. In particular, the 2013 CPSC research conducted between June and July revealed constant number of about 240 persons on average taken to emergency rooms daily. Sparkles, bottle rockets, fountains, multiple tubes, roman candles, novelties, reloaded shells and firecrackers are some of marked firework types associated with most injuries. The firm thus, needs to be extra vigilant in order to escape the massive penalties that will arise from the use of its products in order to remain relevant in the industry.

Analysis of Contract

Bureaucratic contract formation is framed to ensure that both parties are bound by business laws in order to curb cases of breech of contracts that are hazardous to company’s continuous operations and expansions. A legally binding or enforceable contract must showcase some sounding elements aimed at making each party to reach an agreement attached to some value dubbed, as consideration (Furmston, Tolhurst & Mik, 2010, p. 159). To analyze whether these elements were provided for in the agreement, the researcher has to analyze it based on the conventionally outlined procedure contract formation process undertake and a decision reached based on the finding. The researcher hence outlines the required procedure and countercheck with the agreement earlier reached of which, only price was determined. It takes the following steps;



An Offer

In this context, the owner must have made an offer to sell or the buyers making an offer to buy from the owner. Based on details presented, the later was effected as buyers were willing and ready to purchase. We are only disturbed as we are not told the value that was attached to such offers but the owner went further to agree. Assumptions will be made pending confirmation and testing on whether there was a consideration or undue influence. Free consent of both parties remains projected during such agreements.


Analysis will be shifted to confirm whether there was a free will expected by the owner to accept the offer presented (Frey & Frey, 2008, p. 198). The information at hand indicates that there was an acceptance by the proprietor to sell to his buyers. Acceptance satisfies binding contracts elements but we are not presented with details on whether it was an oral, written or performance which casts doubts on law-enforceability of such contacts.

Intention of Legal Consequences

The underlying factor upon which contracts are embedded is parties being able to show intentions to enter a legally binding agreement. There must be an intention across the board to establish legal relations and keen to understand that the entered agreement is a law-enforceable. This intention is presumed to create legal relations so as to ensure one understands and intend to strictly remain within the legal consequences proposed. Should there be dissenting views against legal binding, it should be well stated such as not to be legally enforceable. With respect to this agreement, it is evident that it never followed these requirements and therefore questions are raised.


A valuable consideration supports legally binding contracts. One party must promise to provide services in return for a promise from the other party to avail a consideration (benefit of value).  In essence, it is the price each party gives to the other party for his promise. Consideration is commonly viewed as the money payment but stretches beyond this to anything of value such as refraining from exercising some right and agreeing not to do something (Frey & Frey, 2008, p.186). It is left for parties concerned and need not to be fair; courts will only comes in should there be unconscionable conduct, duress or fraud involved. In this context, we can affirm that there was a consideration as we are informed of agreed price per unit but we are afraid whether the contract was reached. The parties ought to have signed the contracts indicating every term and condition including delivery times.

Types of Employment to be used


The firm can benefit from use of interns that will be paid less amount but are high productive. Interns are interested to work because, besides being paid some amounts of money, they will gain necessary skills required to meet there course objectives. This has a tendency to save the company from employing skilled workers at expensive wages on a permanent employment basis (Cushway, 2014, p.212). The interns are flexible and can be employed on seasonal basis. This will save the business as such people will reduce the time taken to produce products hence increasing firms’ productivity.

Employing many skilled labor will work to the firm’s disadvantage in the long run based on unexpected changes in the economy resulting from reduced demands and changes in consumers’ expectations. Besides, the firm may be dealt a blow by its competitors who might see this as a threat and increase their remunerations rates so as to make this firm unable to meet its goals based on increased wage bill. It would therefore, be beneficial for the firm to employ people on internship basis so as to increase productions but at lowers wages.

Outsourcing of expertise on seasonal basis

The firm should also outsource experts from other firm’s but on seasonal basis. This should only be done during times of need so as to minimize the firm’s wage bill. This will be cheaper as compared to full time employments (Cushway, 2014, p. 123). The firm can still meet its goal via such arrangements until it ascertains its viability and can then increase the number of existing workforce on permanent terms. Such outsourced experts should be paid in terms of output produced and not hours as this will make them work hard and put their best on production. This will translates into minimization of wastages as value of marginal product of labor will be equal to the price paid, (VMPL=W). A firm will thus, employ at such a condition making it easy to match output per labor buy amount payable in terms of wages. Outsourcing has worked out for many firms that are unable to pay for permanent workers based on better strategies and this firm is not an exception.


Recommended Relevant Business Entity

The owner of the firework should enter into a general partnership business entity. This is the most preferred entity that will help the firm meets its objective. The recommendation is informed by the analysis of the current challenges facing the business. This can take the form a merger or bringing on board new partners without existing business. The most preferred would be to look for a firm already in operations. This will help raise the capital requirement as well as employees (Lewis, 2011, p.156). This will help the firms entering the partnership to benefit mutually based on their agreed terms. The business may merge and establish a new name or retain its initial name based on the conditions and terms of their policy agreement. Analysis of this sole proprietor has revealed that there is an urgent need for the formation of a partnership and immediately implemented to curb its collapse.

This is because of daunting challenges and risks associated with the proposed contracts (Delawaren & Corporation Service Company, 2005, p. 178). The investigations has clearly noted that for these contracts to be engaged in, workforce has to be raised from its current size but this is restrained by inadequacy of capital and its viability in the long run. It means, therefore, that external funding is to be sourced, this may make the owner to borrow from friends or banks but it would be disastrous should the business expectations be dealt a blow.

It is the researcher firm stand that, merging the current entity with another existing one culminating into a partnership will make it achieve its goal. Partnership will also take short legal framework and time costs to be effected thus making the business to readjusts effectively (Delaware & Corporation Service Company, 2005, p.187). Management capability will increase resulting from the advantages of a partnership as discussions will be made and rational decisions drawn. Another importance of this arrangement will be the accruals from increased workforce with constant wage bill making these firms to benefit from economies of scale.


Based on the analysis of the current firm’s situation, several mishaps are unearthed regarding the manner in which the agreement was validated. Despite reaching a consideration, there is no detailed agreement on the terms and conditions of what could be termed as a contract legally binding the owner of the firm and his prospective buyers. A contract should be legally binding and law enforceable a factor, not considered.

Questions are raised about the viability of this firm to engage in supply of these large orders as the time frame to support the investment in long run is not defined. The company risks unforeseeable collapse should the inquiries be validated within the company’s current structure. Firework products posse greater threats to consumers as well as the firms using them and hence prone to personal liability based on such injuries. Consumer Protection Act remains so clear on such lawsuits and these calls for proper reasonable care on producers.

With the current shift from application of negligence to strict liability, the company stands to lose should large orders be accepted within current workforce composition. This is informed by the fact that substandard production will be done in order to meet the demand hence less reasonable care leading to defects in design, manufacturing, and warning.  It is upon these revelations that the researchers recommends a merger between the company and another existing one so as to raise the required capital as well as to benefit from increased workforce as wage structure will remain unchanged. The discussion is summarized with a strong warning against the looming rude shock should the management assume the researcher’s recommendations.























Cushway, B. (2014). The employer’s handbook: An essential guide to employment law, personnel policies and procedures.

Delaware., & Corporation Service Company. (2005). Delaware laws governing business entities. Wilmington, DE: CSC, Corp. Service Co.

Frey, M. A., & Frey, P. H. (2008). Introduction to the law of contracts. Clifton Park, NY: Thomson Delmar Learning.

Furmston, M. P., Tolhurst, G., & Mik, E. (2010). Contract formation: Law and practice. Oxford: Oxford University Press.

Lewis, L. K. (2011). Organizational change: Creating change through strategic communication. Chichester: Wiley-Blackwell.

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