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A Wholly owned subsidiary is a wholly owned subsidiary
Corporate shareholder
A company is a subsidiary wholly owned or controlled by a single parent company. There are two ways a parent company can set up a wholly-owned subsidiary: the first is to set up a new company from scratch and build an entirely new one
Production equipment
(For example, factories, offices and
Machinery and equipment
Etc.); The second is to buy an existing company and use its equipment for your own use. Whether to set up a wholly-owned subsidiary by way of acquisition or new construction depends largely on what the parent company plans to do
Business activity
. For example, when the parent company sets up a subsidiary for the purpose of producing the latest
High-tech products
It usually has to build new plants, because it is very difficult to achieve this level of cutting-edge technology depending on local conditions. In other words, we are easily in the majority
Target market
Found on many productions
Bottles and cans
And so on
pintle
The company, but the production of the most advanced
Computer chip
The company is very few. The main drawback to re-establishing a subsidiary is that it takes too long to build new equipment, hire and train workers,
Develop products
And so on will take a lot of time.
Instead, look for an existing company that has
marketing
and
Sales power
This is relatively easy to do because it generally does not require expertise. By buying the marketing and sales operations of an existing company in a target market, a parent company can get its subsidiary up and running faster. Especially when the acquired company has a valuable trademark, brand or in the target market
Process technology
The acquisition approach is a good strategy.
- Chinese name
- Wholly-owned subsidiary
- Foreign name
- Wholly-owned subsidiaries
- jutsu
- Business administration
- connotative
- One-man company
catalogue
On January 1, 2006,
Company law
"Before the revision, only
Wholly state-owned company
A wholly-owned subsidiary may be established. The Companies Act was amended on 1 January 2006 to allow the establishment of one
Natural person shareholder
Or one
Corporate shareholder
the
Limited liability company
, that is
One person limited liability company
.
Company B has only one shareholder of Company A, that is, Company A owns 100% of the equity of Company B, then Company B is A wholly-owned subsidiary of Company A.
1. A one-person limited liability company whose shareholder is a natural person cannot invest in setting up a new wholly-owned subsidiary.
2.
Company registration
Indicate... in...
Sole proprietorship of natural person
perhaps
Sole proprietorship of legal person
And stated in the company's business license.
3, should be in every
Fiscal year
End time
Prepare financial and accounting reports
, and warp
Accounting firm
Audit.
(4) If the shareholder cannot prove that the company property is independent of the shareholder's own property, he shall be correct
Corporate debt
Bear joint and several liability.
The wholly owned subsidiary system is the opposite of the internal corporation system: the wholly owned subsidiary
Legal status
Is an independent legal entity, but only
Divisional system
The permission of. The assessment method of wholly-owned subsidiaries is
Profit center
Responsibility system
Therefore, the wholly-owned subsidiary system is actually a divisional system.
1. Advantages of a wholly owned subsidiary
There are two main advantages to entering a country's market in the form of a wholly-owned subsidiary:
First, managers can have full control over subsidiaries
Target market
Upper daily
Business activity
And ensure valuable technology, craft and some others
Intangible assets
They all stay at the subsidiary. This kind of total control can also reduce other
competitor
Acquisition company
Competitive advantage
This is especially important when companies use technology as their competitive advantage. In addition, managers can maintain full control over the output and prices of subsidiaries. Unlike licensing and franchising, all profits generated by the subsidiary must also go to the parent company.
Second, if a company wants to coordinate the activities of all its subsidiaries, a wholly-owned subsidiary would be a very good mode of entry. The company can
Global strategy
Each country is viewed as part of an interconnected global market. Therefore, the ownership of a wholly owned subsidiary is complete
Right of control
It is more attractive to corporate managers pursuing a global strategy.
2. Disadvantages of a wholly owned subsidiary
Wholly-owned subsidiaries also have two important drawbacks:
First, it can cost a lot of money, and the company has to
Internal financing
Or at
Financial market
Raise money to get money. However, it is often very difficult for smes to obtain sufficient funding. Generally speaking, only large enterprises can afford to establish international wholly-owned subsidiaries. However, citizens of a country who have settled abroad may find that their unique knowledge and abilities (which are in high demand for international subsidiaries set up abroad) are an important advantage.
Second, since the establishment of a wholly-owned subsidiary needs to occupy a lot of resources of the company, the risks faced by the company may be high. One source of risk is political or social in the target market
uncertainty
Or instability. When serious, such risks may threaten both the company's physical property and personal safety. Owners of wholly-owned subsidiaries may also have to bear the full risk of consumers refusing to buy the company's products. Of course, just before entering
Target market
By fully understanding the consumers in the target market, the parent company can reduce this risk.
