What’s the worst company name you’ve ever heard? Analtech? Chew-N-Butts? Passmore Gas? Believe it or not, those are all real company names. Blow it like these folks…and your business could suffer the consequences.
Choosing the perfect name for your business is no small feat. After all, your name is more than just what’s printed on the company credit card and business license. Your name is one of the most important aspects of your business’ brand. When 90% of all purchasing decisions are made subconsciously, you’ve got to be memorable, clear, and likable.
Oh, and original.
What most new entrepreneurs don’t realize is that there’s more to naming your business than simply brainstorming and picking your favorite. Different business structures require different types of names and registration — and messing that up could bear serious legal and financial ramifications.
This week’s deep-dive is all about choosing and registering your business name. Keep reading for tips on name choice and how to register your name to protect your brand.
How do you choose the best business name?
Your business name is everything. It needs to convey who you are and what you sell. All while being catchy, creative, and easy to remember. Oh, and short. No problem!
A unique name will make you more memorable to customers, but be careful when using difficult or unusual spelling. This can have the opposite effect and confuse potential clients.
Settle on a moniker that is expansive enough to give your business room to evolve if that’s part of your plan. For instance, you might start out as “Ready Tires” but down the line expand into windshields and car-detailing. Suddenly your name might feel limiting in what it tells your customers about the services you offer.
On the flip side, make sure you aren’t being too general. Naming yourself “Product Store” tells the buyer nothing. General means forgettable—and earns you a one-way ticket to people’s mental spam folder.
You’ve already gotten a feel for your target demographic’s tastes during market research. Use what you’ve learned to generate ideas. You can even use some market research tactics like focus groups or surveys to cultivate a wider swath of feedback on your top ideas.
Finally, it’s important to be familiar with your competitors’ names. This way you can avoid something too similar and gauge what’s working for others.
Do you need a business name?
If you’re using an informal business structure like a sole proprietorship or a partnership, your business will be registered under your legal name. That’s because these structures don’t count as separate entities from their owners.
However, if you would like to operate under a different name, file a DBA or “doing business as.” A DBA acts as a secondary “fictitious” name that can give you some distance from your legal identity.
If Wanda Smith sells rhinestone bingo visors called “Lucky Glitter Visors,” she’ll need to register that secondary name in order to use it. If she doesn’t, the business name defaults to “Wanda Smith'' which…is a little lackluster. No shade, Wanda.
Registering your DBA makes it traceable back to the entity that owns it. Each state has its own requirements and fees for registration. While registering a DBA doesn’t legally protect your name (other businesses can use the same DBA) it can give a record of use.
Another added bonus? A DBA and a tax identification number will allow you to open a business bank account.
What if I’m an LLC or C Corp?
An LLC or a corporation requires an entity name.
Unlike when you named your family dog “Microwave” at the age of five, there are a few rules and restrictions.
Your entity name is what appears on all business, legal, and advertising documentation. It’s registered with the state and it’s how the state recognizes your business.
Depending on your location, your state may have specific rules — like requiring your name to reflect the nature of your business.
Registering your entity name legally prevents others from operating under that same name. Once you have your entity name, you can have multiple businesses tied to it but using different DBAs.
For example, Wanda Smith’s entity name might be “Wanda’s Visors and Accessories.” Her various DBAs might be “Lucky Glitter Visors” and “Sparkle Step Sneakers.” You go, Wanda.
Want even more protection?
Planning on going to the big leagues with your business? Protect your name on a national level.
A trademark protects not only the name of your business, but the name of individual goods or services.
This powerful registration tool carries some serious legal protection. It prevents others from using your protected names across the country in the same or similar industries, and lets you file for injunctions or monetary damages if they do. As you can imagine, being on the receiving end of a trademark lawsuit can be quite costly.
That’s why it’s always a good idea to crosscheck your potential business names with the US Patent and Trademark Office.
What about the internet?
If you don’t have an online presence, do you even exist? Register a domain name to lay claim to your business name on the internet.
Domain names refer to your website and email address. You register by purchasing the rights to a name through an accredited registrar and maintaining ownership. Once you register your domain name, no one else may use it.
While helpful for a cohesive brand, your domain name doesn’t need to match your DBA or entity name perfectly.
What’s in a name? Quite a lot.
Your business name is how customers will begin to recognize your product. So make sure it’s protected with your business structure and goals in mind. If you overlook preexisting trademarks or registrations, it could cost you dearly down the road. Or worse yet, leave you with no viable identity.
As you can see, choosing a business name isn’t simple. But it can be fun!
Keep an eye out for next week’s Deep-Dive #7: Registering Your Business.
Need help determining if a DBA is enough? Curious what name goes on your tax forms? Reach out to KYN Accounting today for expert help from the friendliest accountants around.