What does a sole proprietorship mean?

A wholly-owned company is a form of enterprise, which means that the property rights of subsidiaries are completely held by the parent company. This means that the parent company has all the rights and responsibilities, while the subsidiaries are completely controlled and managed by the parent company. In a wholly-owned company, the parent company and its subsidiaries are different legal entities of the same company, and the subsidiaries are attached to the capital and management system of the parent company.

The advantage of a wholly-owned company is that the parent company can completely control the subsidiaries, which means that the parent company can intervene in the operation and decision-making of the subsidiaries at any time, thus ensuring that the strategic direction and management style of the subsidiaries and the parent company are consistent. In addition, a wholly-owned company can make use of the reputation and capital advantages of the parent company to obtain financing and expand its business more easily. The disadvantage is that subsidiaries can't make decisions independently, and excessive centralized management may lead to the decline of innovation ability and decision-making efficiency of enterprises.

A wholly-owned company is usually suitable for the situation that the parent company has core business in a certain field or market and needs to fully control the overall situation. In addition, a wholly-owned company can also be used as a means for multinational enterprises to expand their business in different countries or regions, and set up subsidiaries to adapt to the local policy, legal and cultural environment and realize localized management.