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What is the best way to describe an upstream sale and a downstream sale? What is the name of a company that would have e...

What is the best way to describe an upstream sale and a downstream sale? What is the name of a company that would have either a upstream sale or downstream sale?

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Answer #1

1) An upstream sale is described as a sale made by a subsidiary company to it's holding company, on the other hand downstream sale can be described as a sale made by holding a company to its subsidiary company.

2) A company having either a downstream or upstream sale is either a holding company or subsidiary company. Both the companies taken together can be called a group company.

Logically the things can be easily remembered by way of a diagram:

Company A (Holding Company)

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Company B (Subsidiary Company)

When Company A makes a sale to Company B it is a downstream transaction and when Company B makes a sales to Company A it is an upstream transaction.

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