What is a 'Branch Office'

A branch office is a location, other than the main office, where business is conducted. Most branch offices are comprised of smaller divisions of different aspects of the company such as human resources, marketing, accounting, etc. A branch office will typically have a branch manager who will report directly to and take orders from, a management member of the main office.

Many retail investment companies, Edward Jones, for example, use a hub and spoke method to serve their clients. The hub, or home office, serves the spokes (branch offices) by carrying out many of the administrative functions best suited for scaling operations. For instance, an investment company’s home office will perform and make available to branch offices many services including portfolio management, security analysis, branding, legal and a host of other services required to run a full-scale operation.

BREAKING DOWN 'Branch Office'

Branch offices are useful in that they allow many of the client-specific administrative considerations to be conducted closest to clients. Many customers may prefer a local representative they can call on rather readily. For example, Starbucks has branch offices to better serve their retail stores' district managers in a more cost-effective manner. They can also cater to and be more informed about the needs of specific locations.

There’s no universal model a branch office setup may take on, but many are located based on geographic need. In more populated urban centers, it’s not uncommon to see many branches within proximity to one another. In more rural areas, it may make sense to operate fewer branches which are further apart.

A branch office may include a single representative, or it could be staffed with many individuals based on business need. Advances in telecommuting and other methods of communication have greatly driven down the cost of setting up operations. The “pop-up” shop is now a fairly common event for retail and other event-driven commerce opportunities. In the future, it’s not unthinkable that financial service providers will use a pop-up model to quickly deploy temporary branch locations to meet an always-on or on-demand marketplace.

  1. Branch Banking

    Branch banking is engaging in banking activities such as accepting ...
  2. Shell Branch

    A shell branch is a branch location of a U.S. chartered bank ...
  3. Checks And Balances

    Checks and balances within an organization are the various procedures ...
  4. Separation Of Powers

    Separation of powers occurs in an organization, when responsibilities, ...
  5. Series 30

    The Series 30 is an exam and license for professionals seeking ...
  6. Subsidiary Bank

    A subsidiary bank is a type of bank that is located and operated ...
Related Articles
  1. Investing

    Big-Bank Branch Growth May Most Hurt Wells Fargo

    America's largest financial institutions are doubling down on new markets at the expense of Wells.
  2. Insights

    Why is JPMorgan Expanding in India When Other Banks Are Closing?

    While international banks like HSBC and Barclays are closing their branches in India, JPMorgan is expanding in India. Here's why.
  3. Insights

    The 4 Biggest Chinese Banks

    Learn how the Chinese banking system is operated and managed, and get information about the top four largest banks in the country.
  4. Insights

    How Online Banking Is Overtaking Traditional Banking

    Is traditional banking doomed to be surpassed by online banking?
  5. Investing

    Big Banks Give Up Physical Branches for Digital Space

    Bank of America and JPMorgan are closing down physical branches in order to focus on mobile phone space.
  6. Managing Wealth

    Top 3 Trends Affecting Private Wealth Management

    Don't miss out on high-net-worth clients because you aren't prepared for their service demands.
  7. Insurance

    The 5 Big Names in Canadian Insurance

    These Canadian companies are known around the world for their products. The big five include Manulife, Power Financial, Sun Life, Fairfax and iA Financial Group.
  8. Personal Finance

    Bank of America to Cut 8,000 Jobs (BAC)

    Bank of America's president of retail banking has announced thousands more positions to be eliminated in the coming years.
  9. Insights

    Will “Internet-Only” Banks Change Chinese Banking?

    Private players offering internet-only banking services to a large section of China's population must overcome some challenges to gain market momentum.
  1. Can Foreigners Open Savings Accounts in the US?

    Find out what it takes for a foreign individual to open a savings accounts in the US especially in the age of heightened ... Read Answer >>
  2. What is the difference between an investment and a retail bank?

    Learn the primary differences between retail banks and investment banks by examining the business activities, type of clients ... Read Answer >>
  3. Is It a Good Idea to Buy Mutual Funds From Banks?

    Mutual funds can be purchased through many different financial institutions, including banks. Read Answer >>
Trading Center