But what special factors should you take into consideration when writing a business plan for a subsidiary? A subsidiary is a business that is fully owned and controlled by its parent company. It is a legally separate business and it may be used to launch a new product line or enter a new market, for example. Sister companies are subsidiaries owned by the same parent company. Before you write your business plan, you need to decide whether you want to set up your new venture as a subsidiary of your existing business or if you should create a completely separate new business for it.
For example, a restaurateur may open a wine shop or a caterer may also double as a part-time copy editor. Should you form one corporation to cover them all? Should you form an LLC for each one? You need to answer these questions from both a marketing and legal perspective. For marketing, you need to consider the markets and target customers for each venture.
In addition to creating a business plan to use for getting startup financing, there are other good reasons to create a plan. Use a business plan template to look at all the areas of your most standard businesses. The template will help you make sure all areas are covered, so your startup goes more smoothly. Small business expert Amanda McCormick suggests looking at five key assumptions to make sure you are ready to start and they will help you be more confident of success. Probably the most important thing you can do with your business plan is to use it to build your startup business.
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