Setting up a Division

**FrioGott** · 06-03-2009 12:38 PM

How exactly do I set up a division within my company?

**rogercbryan** · 06-03-2009 12:52 PM

ummm... what do you do... what will the division do... why do you need it... can you afford it... will it make you more money... will you have to hire a new staff... will you need more office space... will you need more computers... will you need new management... would you like fry's with that?

Answer these questions and you'll be on your way to starting a new division (if you find you actually need it).

**paul2145r** · 06-03-2009 03:59 PM

Write a witty name on a piece of paper, then write (in smaller font), a Division of **Your Company Name**. Then, take that piece of paper, and tape it to a door somewhere.

Seriously though, it all depends on what the new division will be doing, and how much liability protection and independence you are wanting to give the new division.

If you're wanting to divide from a legal standpoint, you can set up a separate LLC or corporation. Your current company can be listed as the owner. If you're wanting to keep the division legally under the umbrella of the same LLC or Corp, but want to use the new division's name for advertising, marketing, sales, etc, then it can be beneficial to register it as a DBA (Doing Business As). This will extend the same liability protections to you and any other owners/investors as your current company.

If this is something that is primarily for purposes limited to organization or differentiation between projects, you may not need to follow any of the above suggestions.

Another thing you have to consider is any insurance/bonding/etc that you will have to hold. If your current company is required to be insured, or has insurance, worker's comp, etc for a specific portion of the business (construction, clerical, etc), then your decision can play a big part in your rates. If the new division is involved in other industries or aspect of business and you keep it as being a part of the primary company, you'll have have your insurance liabilities and premiums reevaluated to ensure that you don't have any lapses in coverage. If you go ahead and register the new division as a new legal entity, it is doubtful that your current policies will extend to the new venture.

Overall, I recommend explaining the intricacies of what you're needing to a consultant, attorney, or SBA sponsor. They'll be able to help you work out your exact needs and what you need to do to fulfill them.

**FrioGott** · 06-03-2009 07:33 PM

It will be mostly for marketing purposes and differentiation in projects. The main company is manufacturing robots. I want to create a division of my company that will make a different type of product not really related to robotics. It will still be manufacturing however.

**paul2145r** · 06-04-2009 12:04 AM

The easiest way would be to file a Doing Business As form with your state/local government, acknowledging that you will also be operating under that name. Keep the books together, but differentiate for any financials that apply to the new division.

**ideas2earn** · 06-04-2009 11:03 AM

This is such a broad question, I would think the OP is probably not ready to do it, if he cannot formulate better, more incisive questions.

**FrioGott** · 06-04-2009 11:23 AM

Originally Posted by paul2145r

The easiest way would be to file a Doing Business As form with your state/local government, acknowledging that you will also be operating under that name. Keep the books together, but differentiate for any financials that apply to the new division.

Can you file multiple DBA's? In other words can your business operate under more names than the one on the Articles of Organization and on a DBA?

ideas2earn: Not sure how my question is broad. A broad question in my opinion would be "How do I set up a business", and then providing no details as to if it is even in the production or service industry. I have specified in a later post that it is manufacturing, and the division would be manufacturing of a different line of products.

Take GM for example. You have GM, then you have Chevrolet, Buick, Pontiac etc. all as Divisions and Subsidiaries. My division will be strictly for branding and marketing purposes like GM has done. I just needed to know if there are any forms or any doors I need to go through to make it legal that it is a division. I don't want a subsidiary though. As I understand it that is a company owned by another company.

**paul2145r** · 06-09-2009 11:25 PM

Yes, a business can have multiple DBA's filed, but every one increases the liability of the venture as a whole (name disputes, copyrights, etc). This is the case in all of the states that I do business in, but I would still double-check to make sure that it applies in your own.

**BusinessAdviser** · 06-10-2009 12:21 AM

It will only create as much liability as the business, with each of its names, has.

**FrioGott** · 06-10-2009 02:02 PM

Originally Posted by paul2145r

Yes, a business can have multiple DBA's filed, but every one increases the liability of the venture as a whole (name disputes, copyrights, etc). This is the case in all of the states that I do business in, but I would still double-check to make sure that it applies in your own.

Awesome, that is what I like to hear. That should make things easy. I appreciate all the help thaks a lot! I'll double check for Oklahoma, but I am sure it's probably still the same.