Affiliate

The term affiliate can be defined in two different ways when used in a business context. When discussing corporate laws or corporate taxes, the term affiliate is used to describe a company that is closely related to another company. Generally, this affiliate company holds a subordinate role or a primary role as a partner. There are three different ways that a company may be affiliated with a larger corporation. They can own shares of a larger corporation, hold a minority interest in the large scale business, or simply be a subsidiary affiliate company. In online retail, a larger company may choose to affiliate with another individually owned company by giving them the option to sell their personal products or services to the public. The large scale business will render a commission to their affiliate companies, but remain the sole proprietor of the larger scale business. In the virtual world, this arrangement is referred to as an affiliate network or affiliate marketing.