What Is a Division of a Company?

A division is a smaller part of a parent company tasked with overseeing different types of products or services than those offered by the parent company. Divisions may or may not operate under the same name as the parent company.

Large corporations generally create divisions when they market more than one type of product or service. Each division focuses on a specific aspect of the parent company’s business plan. The parent company is legally responsible for the debts and obligations of its divisions. In contrast, a subsidiary is a separate legal entity despite it still being owned by the parent company.