Holding & Operating Company Setup for Multiple eCommerce Businesses

[teamtrav]

Idaho

Right now I operate multiple eCommerce websites under one S-Corp. My thought is to separate each of those websites into their own S-Corp or LLC under one Holding Company.

My problem is I would use the same shipping warehouse to store inventory and ship out orders for all my websites.

One thought is that I have the holding company own all the inventory and essentially the websites only own the brand/domain and are paid a commission on sales, however I didn’t know if this approach would protect the holding company from any liability from customers where it would own the inventory.
What would be better – Holding company owns inventory and pays commissions to website operating companies, or the website operating companies own the inventory and pay the holding company or a separate “Fulfillment Center” Operating Company a warehousing/fulfillment fee?

I want to take the easiest approach. I also sell on an online auction site that is known for closing accounts for random reasons so I figured I could dissolve a LLC or S-Corp if this where to happen and start a new one under the same holding company easily enough.

Would you do an LLC or S-Corp for the holding company and operating company?

 

[quincy]

Idaho

... Would you do an LLC or S-Corp for the holding company and operating company?

You will need to sit down with a business professional in your area to help you decide which business structure is best for you based on all of the facts of your operation. In other words, your question cannot be answered adequately in a forum setting.

Good luck with your eCommerce websites.

 

[xylene]

1. You are at the point of needing a lawyer.

2. If liability is the concern, consider that a good insurance policy may be cheaper than a complex business structure