Choosing and registering a company name
It may sound obvious, but a name is an important part of any business for a variety of reasons. Whatever type of business you want to run, whether a limited company or working as a sole trader, it is a legal requirement to have a name. Even sole traders need something to call themselves to give them an identity that helps potential clients and others to be able to identify you and perhaps even help them to recognise what it is you do. Some people just trade under their own personal name, while others choose a brand name as a trading name. There are countless options and you need to pick something that suits your industry and your own professional circumstances.
A common option for people just embarking on a new business venture is to start as a sole trader and incorporate as a limited company further down the line once the business has grown. It is worth keeping this in mind when you choose your trading name, so it might be worthwhile picking something unique that can later be registered with Companies House if you do decide to make the move limited. It is also possible to register a name with Companies House from the beginning, even if you do not start operating as a company straight away. This gives you a certain level of protection and helps prevent others from using your name later on and trading off the good reputation that you have built up.
How to choose the best name for your business
Choosing a name may sound like a straightforward task. Many people even have a name conjured up before they even know what their business will be, while for others the name popped into their head before they even started properly planning the nitty gritty of launching a new business.
The reality, though, is that there are many things to take into consideration before you settle on your name. After all, the name is the first thing that many potential clients will see and it could be with you for years, so you want to make sure you get it right from the beginning.
The key thing that you should check first is whether or not the name you want is available. Legally, you are not allowed to have the same name as another business already in operation. Trade marks also exist to prevent people using a name that is too similar to one already in existence and to stop new businesses coming up with variations on other company names that could mislead customers and suppliers. Check out our sister company SJD Accountancy, as it has a free free company name checker for you to use and will help you check that the name you want isn’t already in use.
The company structure will also play a part in your company name. Limited companies need to state that in the name, as Joe Bloggs Ltd for example, while limited liability partnerships will end their name with LLP. If you do set up as a partnership it is worth remembering that including the surnames of all partners into the name, such as Smith & Jones LLP, can potentially cause difficulties should one of you leave later on down the line. This can affect your company name and impact upon the brand that you have already established. Adding Ltd, or LLP, to your company name may sound a mouthful, but remember that you do not have to use this as your trading name, but just your official company name. So you could be Smith & Jones LLP, trading as SJ Solicitors.
What should your name say about you?
Choosing whether to have a descriptive name or an abstract one, as in one that tells people what your business does compared to a random word or name, is a big decision to make right from the off. There are great examples of both from some of the biggest companies in the world. Amazon is one of the largest online retailers on the planet, yet its name is abstract because it gives no indication of what the company does. Coca Cola, on the other hand, includes the fact that it is a cola drink in its brand name.
Large companies the world over have spent millions changing names and employing branding agencies to choose names for them and often the process can take months just to choose what the right approach is for a particular business. Hopefully your decision will not be anywhere near this expensive or lengthy, but it does emphasise the point that it is an important decision to make in the early life of your new business.
Descriptive names do exactly what they say on the tin, they describe what your business does. This could be Jones Bros Hairdressing, Smith Marketing Services or Joe Bloggs Wedding Photography. Shoehorning in your business type can sometimes look a little clumsy and make your company name a little ‘wordy’. That said, it can be an instant attention grabber when people want to find a particular service quickly.
A trend growing in popularity in recent years is choosing abstract names, whereby the brand name has little to do with what the company does and then building a brand around that name, using marketing and reputation management to help make sure potential customers know what you offer. As mentioned, Amazon is a prime example, Orange, Apple and Google are other high flyers to go down the abstract route and no doubt you will be able to think of many more.
Having millions to spend on marketing an abstract name is all well and good, but doesn’t really help many new or small businesses who rarely have such resources. One way to address that if you still want to go down the abstract brand name route is by using a tagline underneath your name, something that can quickly tell your would-be customers what you do. This means you can choose a memorable, snappy name, then add a few select words to describe your business alongside it.
Stay clear of controversy
You don’t want to instantly offend certain people with your choice of name. This isn’t ‘political correctness gone mad’, but merely good business sense. You can have a humorous name, if you want, without it being vulgar or offensive. It can also land you in trouble if you start to advertise your company with a name that the Advertising Standards Agency could deem sexist, racist or otherwise offensive.
If you have visions of international growth then it is also useful to check, especially when making up words, that you haven’t stumbled across a phrase that is an awkward or embarrassing phrase in another language. The Iranian soap brand Barf, which is a word for snow in the company’s native tongue, is unlikely to ever take off in English-speaking countries. Similarly, researchers at Procter & Gamble had global branding in mind seven decades ago and clearly did their homework when they decided against launching Dreck detergent after discovering that it sounded similar to a German word for garbage.
Keep it internet savvy
We’ve already mentioned the importance of checking your name is not already in use, but availability these days also involves checking what domain names are available. A website is likely to be a key part of your marketing strategy, so choosing a name that has a .com or a .co.uk web address available can be a real advantage. You want a website address that customers can easily remember, that you can easily spell out or write down for people and that people can type in quickly. These days, single word domain names are like gold dust, but even if you can’t find your exact name, then some variations might be available. Hyphens can be used, for example, but remember you need to spell it out to people so try to avoid using too many, while some companies add short words to their name to give them a unique domain name. Recruitment firm Adam uses weareadam.com, for example, while adding HQ to the end of a name before the .com is another popular trend for web addresses.
It is also important to think about how easily people can find your company name when searching for services or products on the internet. Search engine optimisation, or SEO, is all about making sure your company website is optimised for search engines such as Google and Bing, making it as easy as possible for potential customers to find you. SEO comes into play when choosing company names and domain names too. Google places less importance on ‘exact match domains’ than it once did, so choosing Washing-Machines-For-Sale as you web address doesn’t necessarily mean you will rank number one when people search for washing machines for sale, but it can still be an advantage to be called John’s Gardening Services if customers are searching for ‘gardening services’.
On the other hand, choosing a very generic name or a popular word as an abstract name could mean that people searching for your company details online may struggle to find you if millions of other web pages also refer to that same word. You can get more hints and tips on SEO and keywords here.
The potential for embarrassment also comes into play when choosing domain names too, so make sure you look at how your company name reads if all the words are joined together to form your domain name. Technology help website Experts Exchange uses a handily placed hyphen in between the two words for its web address, as joining both words together gives the impression of a slightly different service (type it out yourself if you’d like to see what we mean!). There are plenty more tips on choosing your domain name on our introductory article to Setting up your Company Website.
Keep it professional
Some businesses or websites may benefit from a humorous name, but for the majority of small businesses or those starting out, you will want to keep it slick and professional. Once your business takes off you may be looking to seek outside investment or even sell the company, so you want to give a professional and businesslike impression right from the beginning – and that starts with the name. Some would-be investors may be less than keen to sign over cheques to companies with outrageous or controversial names. If a bizarre name is crucial to your brand then its best to register a safer name as your official company name with Companies House and then trade under the more bizarre brand.
What to do next
After choosing your name and making sure that it is available for you to use, you need to register it and set up your limited company. We can help you with this and make it as hassle-free as possible. Check our our page on how to Form a Limited Company for more details on the next steps. This service costs just £125 plus VAT, which is one of the lowest prices on the market, with the competitive service including:
- Setting up a bank account for your new company
- Completing all necessary VAT and PAYE registrations
- Advice on the best share structure
- Complete company set-up service, meeting all legal requirements
- Issuing your certificate of incorporation within three hours of registration, provided your chosen company name is available(with the exception of companies in Northern Ireland)
We hope this short guide helps you in your search for a new business name but please get in touch if you would like any further information.
You may also find our other Free Business Guides useful:
- How to advertise your business
- How to market your company for (almost) free!
- Is freelancing for me?
- What will an accountant do for me?
- How to be number one on Google
- Benefits of an Accountant
- Do I need an accountant as a Freelancer?
- Top Tips to getting more Customers
- Creating a website for your business
- Do I need a business plan?
- Choosing a small business accountant