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Naming Your Business

According to many reports there are somewhere around 3-4 million small businesses already in the UK ranging from the sole trader through to the limited company. Each of these businesses trades with a business name. Some will merely be based on their names like Joe Bloggs & Son, some will be based on brand names they are promoting, like M&S, while others will be a combination of name, brand and sometimes nothing at all to do with what they are promoting. All incorporated businesses and Limited Liability Partnerships have to be registered with Companies House.

Business names are no longer registered with any government department, but there are laws about using certain names and disclosing certain details of ownership of a business and this is controlled by the Business Names Act 1985. This act applies to a company that trades under a name which is not its corporate name, a partnership which does not trade under the names of all the partners or an individual who trades under a name that is not their surname. As well as controlling the use of sensitive words for which permission has to be obtained, it also controls what disclosures a business has to comply with such as what details have to be disclosed and where this information is shown. For example in the case of a partnership, unless there are more than 20 partners, all partners names have to be shown at the places where the business is situated, on business letters, invoices, written orders for supply of goods or services etc.

When deciding what name to call your business you will need to consider some options and carry out tasks to see if you can identify if there is a business already trading with that name and in your speciality.

Creating the right impression

Choosing the right name is important as it needs to create the right impression and get across to your customer what your business is about. Give a name that immediately indicates what you do or how you do business. If it is too ambiguous you will need to run rider lines and other explanations which will lead to confusion for the customers. Consider how you are going to promote your business, and therefore advertising, website and other considerations need to be thought about. Something short and snappy will cut pounds off your advertising bill and will allow your customer to remember you instantly. Have a look around you at existing businesses that impress you and see what they have done and see if you can analyse what it is about their name that makes you remember them.

Other points to consider include, do you want a traditional sounding name, conveying durability and old fashioned values, or a modern name, suggesting a fresh and innovative approach. Think about the future, try to avoid words that may date. Avoid very long names, initials, using your own names, clever names, strange words or unusual spellings. If you are to be trading overseas check that the name can be easily read and pronounced and doesn’t have another meaning in another language especially one that may upset or cause offence.

Create a short list of names. Initially write down ALL the names you can think of that might be appropriate for your business. Then start the elimination process to leave you with, say 5 possible names. Before you dismiss names, could they be altered using other ideas you have already come up with to create a worthy name? Now you are ready to start looking for any business that might already be using this name or something similar.

Sensitive and Reserved Words

There are some words and expressions that you cannot use in a business name without getting special permission. These are words that are considered might give a false impression and they are known as sensitive words. For this reason they have been prescribed in regulations as requiring the approval of the Secretary of State. Such words includes the following categories, words that suggest your business is of national importance, like British, national or international; those that suggest special status like association, society; or can imply a particular function like Charity, Trust or Insurance; suggesting a specialised activity like Architect, Chemist and finally those that may suggest connections with government or royalty.

However if you want to use a reserved word say like ‘International’ it is not impossible and only adds an extra step in the formation of the business. Let’s use 'International' as an example of what is needed, to use this within your business name. As at September 2005 the requirement was to provide a cover letter, with the company formation documents, addressed to the Secretary of State stating that the company is operating in at least 2 different overseas countries, or will do so within 3 months of incorporation. In the case of a club it has to have members in at least 2 different overseas countries or will do within 3 months of incorporation.

Working out if the name is already being used

Before you finally decide on your chosen name and go through the process of registering a company with it, it makes sense to check whether it is already being used as this will cause less problems later. So how do you go about finding out if the name is already in use? It is not possible to check every single business in the UK as there is no central register of them all. And at the end of the day you can only do as much as is humanly possible within the resources you have available to try and track down what is already in use. However carrying out the following tasks may go some way to helping:

Look at the register of companies at Companies House. This register lists all companies, LLP’s, PLC’s that have been registered in the UK, it also includes those companies which since have been dissolved. You can view the register either on their website, www.companieshouse.gov.uk , or you can visit one of their offices and look through their databases on their computers in their enquiry offices.

Make sure it isn’t too similar to a word or expression that has been registered as a trade mark, by checking the Trade Mark Register at the Patent Office, their website is www.patent.gov.uk

Use the online resource of the National Business Register PLC, they provide data on 10 million UK businesses, companies, trade marks, brands and website domains. You can search their database for names free of charge. You can access their website at www.start.biz

Research on the internet. With the internet being a worldwide resource putting the business name into a search engine like Google will bring up any existing similar business or domain name anywhere in the world.

A visit to your local library reference section and a check of business directories, Trade Journals or magazines, may also show up any possible conflicts.

Check local phone books for the area your business is going to be based and see that there isn’t already a business in the area with the same or similar name.

A note of caution, even after all this research you may still come across a problem either when incorporating or at a later date, as sometimes bigger businesses will trade under different brands and you will not necessarily be aware of them if they are not local to where you live, but the brand will not necessarily appear in business directories etc. Or a person may be carrying on a business under a trading title as a sole trader, however the telephone line may be registered in the individuals name and not the businesses name so you would not come across it in the phone book.

However If you have researched all these avenues plus any others you can think of and the name you have chosen is not, as far as you're aware, going to be in conflict with anything else already in existence, then you should now have a pretty good idea of what your new business is going to be called.

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