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Setting up branches in different places is a common way for companies to grow their business on a national or international scale. Branch offices are part of the parent company and are opened to do the same business as the parent company. This helps the parent company reach more people.
Branch offices are different from subsidiary companies. A subsidiary company is a business that is owned by another company, called the holding company, which has the most shares. The parent company owns both the branch and the subsidiary company, but they are different in many ways.
The article below explains the differences between a company’s branch and its subsidiary.
Table of Contents
A branch is an extension of the parent organisation that is set up in a different place to reach more people. It does the same things that are done at the main office. The person in charge of the branch is called the branch manager. The branch manager is directly in charge of the branch’s work and also reports to and takes orders from the head office.
Most banks and other financial institutions have branch offices that act as agents. Setting up branches in far-flung places increases the number of customers and makes the business easier to reach. It also helps distribute goods and services quickly and well.
The term “subsidiary company” refers to a business that is owned and controlled by another business. When one company buys another, the company that bought the other company is usually called the “holding company,” and the company that was bought is called the “subsidiary.”
A company is a subsidiary of another company if any of the following three things are true:
The difference between a branch and a subsidiary can be seen in the following ways:
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