Subsidiary vs. Sister Business: An Overview
The difference between a subsidiary and a sister company lies in their relationship to the parent company and to each other.
A stepmother company, by definition, owns one or more separate corporations, known as subsidiaries. The parent company may own the subsidiary company plainly or may hold a controlling interest in its company stock. Usually, the parent company is larger than any of its subsidiaries.
Sister friends are subsidiaries that are related by virtue of being owned by the same parent company. Each sister company runs independently from the others. In some cases, the only relationship between sister companies is their common ownership by a originator company.
Subsidiary
Subsidiaries may be obtained through acquisition by the parent company. In other cases, a company creates one or more subsidiaries to part its business more efficiently.
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Sister Company
Sister companies are subsidiaries that are related by virtue of being owned by the uniform parent company. Each sister company operates independently from the others. In some cases, the only relationship between sister ensembles is their common ownership by a parent company.
Sister companies may produce a range of products that are quite extraordinary from each other, and even from those of their parent. In other cases, they are direct antagonists or were both taken over by the same parent company. After they become sisters, the parent firm usually imposes new branding strategies that distinguish them from each other in order to reach contrasting markets.
However, there are sometimes arrangements between sister companies to share marketing or other resources, or they weight offer each other special pricing. An example might be a fabric manufacturer that works with a apparatus retailer to produce and market a line of upholstered goods.
When sister companies have a common
Subsidiary vs. Sister Public limited company: Examples
There are many examples of subsidiary and sister company relationships. However, the lines between the two admittedly get blurry as a crowd grows into a conglomerate.
For example, Viacom Inc. has morphed over time into a multinational mass media conglomerate. Viacom owns Viacom Ordinary Networks, which includes cable channels Nickelodeon, BET, Spike, and Comedy Central. Viacom Media Networks is a subsidiary, while those strand channels would be sister companies. Its ownership of many channels allows it to package advertising more effectively.
Gap lay aways are well-known to consumers, but Gap Inc. is actually the parent company that owns Old Navy, Athleta, Banana Republic, and Intermix, in the midst other familiar store chains. The sister companies each occupy different niches. Old Navy, for example, was initiated as a moderate-priced chain, while Intermix targets a younger crowd.
Key Takeaways
- The difference between a subsidiary and a sister assemblage lies in their relationship to the parent company and to each other.
- A parent company, by definition, owns one or more apart corporations, known as subsidiaries.
- Sister companies are subsidiaries that are related by virtue of being owned by the same guardian company.