How To Choose A Name

Choosing A Name

Choosing Your Name

Choosing a name for your business or what to call yourself is a question that comes up at workshops a lot. Like most aspects of starting a business in the UK it is not straightforward and you have a lot of different options. This briefing note attempts to help you think through the whole process of what to call yourself.

Legal Considerations

Sole Trader?

You can pretty much call yourself anything as a Sole Trader; all you have to watch for is that you don’t infringe another person’s copyright or trademark. And you cannot pass yourself off as someone else by adopting a very similar name that might be misleading - MacDonalds or WH Smythe.

See Where To Start below

Limited Company?

You must comply with a strict set of rules from Companies House that govern the name of your new legal entity. Among these are some forbidden words like anything to do with the Royal Family, pretending to be a Government Department or infringing existing trademarks. When choosing a name you will have to find one that differs from existing names by at least two characters.

See Where To Start below

Trading name v. Legal name

Your trading name or brand name - the name you present to the world - does not have to be the same as your legal registered name. For example St Michael plc trade under the brand name “Marks and Spencer”.

You may choose to create a series of brand names for each product or service in your range. You may then register a website using those brand names rather than your legal registered name.

To safeguard the general public, both Sole Traders and Limited Companies must make the real name and identity of the registered business clear on their invoices, websites and letterhead. This usually means putting a note in the footer. Here’s mine:

Although my website and trading name are ‘Lighthouse 365’ I have to put this note on webpages and letterhead

© Lighthouse Coaching & Training Ltd 2010 | Registered in England and Wales No: 4511213 | VAT GB 809 7771 87 |

You could set up a different legal entity for each product or service but this is unnecessarily complex. As far as your accounts are concerned, a sale is a sale, it’s just money in. The simpler solution is to have a number of different brands or services with all the sales revenue feeding into one set of accounts.

Take advice from your accountant as you grow about whether there are any tax or VAT advantages in arranging something more complicated.

The Customer Viewpoint

By far the most important question about your name is how will customers react to it and what is it that your customers are looking for. Most people looking for a plumber expect the business to have the word plumber somewhere in the title. You do not expect a plumber to be called “orange’ or ‘Apple’ you expect it to be called ‘Smiths Plumbing Services’ or ‘Pimlico Plumbers’.

Consider these examples:

Orange - had to spend a lot of money associating this with mobile phones. The advantage of a vague name is that it gives you a clean slate and leaves room for other business options. The downside is the money that you need to spend to get everyone to understand that Orange = Mobile Phones. Similarly, Virgin and Apple.

Nike - still vague but for those that know their Greek Goddesses it does at least have some sporting associations.

Manchester United - a name that is closer to what they actually do but still does not immediately identify them as a football team.

Reckit Benckiser - the company behind brand names like Vanish or Strepsils. They are using the product name rather than their company name. In a similar fashion companies like GlaxoSmithKleine or Johnson and Johnson use brand names rather than company names.

Robert Walters - this is a recruitment company but you wouldn’t know it from the name.

More literal names:

Financial Services Authority - a much more literal description of what they do

Lloyds Bank, British Airways - again much more literal names that help explain what they do.

The function of your name is to distinguish you in the market but also to help customers understand how and what to buy from you. When you are choosing a name put yourself in the customers shoes and ask yourself what would help them the most.

Choosing a name: Doug Hole

Let’s look at the case of Doug Hole who is leaving his job to set up a one person Limited Company. What are his name choices?

Doug will have to decide whether he wants a name that leaves his options open or a name that helps his customers understand what he offers. A lot will depend on whether he can find a website name that matches

Your Name: Where To Start

Brainstorm a few ideas and then start checking in these places

And finally…

Pick something memorable and easy to spell especially for someone hearing it over the phone. You will be repeating this name a lot in the next few years so make your life easier and choose something that avoids misunderstanding.

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