Choosing your business name

Your choice of name says a lot about your business. It is therefore important to choose a name that will convey the right image and message. A business name is a name used by any person, partnership or company for carrying on a business, unless your own name is used. If you are using your last name for the name of your business, then this topic will not apply to you.

Before you start to think of a name, it would be worthwhile to think about why anyone would want to buy your product or service. This is important to understand because customer behaviour will affect their decision to buy or not to buy.

Why people buy
The reasons for buying usually fall into two categories: rational and emotional. Rational reasons could be because the product or service is cheaper, has a free one-year warranty or the running and maintenance costs are low. Emotional reasons for buying a product or service could include it looks good, it has been recommended by friends or it has prestige appeal.

These reasons will help you to give your product or service its reputation, that is, your brand image. You should create an image of quality and reliability around your business name, so that as your business becomes better known, the good reputation it will generate will go before it.

Tips on choosing a name
When choosing a name, think of a name that will:

• convey a positive image
• be unique to your product or service
• be able to translate in any foreign language without causing offence
• be placed near the top of alphabetic listings, if searching is required
• include a description of the type of business for instance, Aztec (Builders) Ltd, where possible

Checking if your business is legally acceptable
Whichever business name you choose, it will have to be legally acceptable and abide by the rules in the Business Names Act 1985. This applies to a company which trades under a name that is not its corporate name, for example 'ABC Limited' trading as "Easy Toys".

To check if your business name will be acceptable, you will need to find out:

• If there are any other businesses already using your name? You could check this in your local phone directory, relevant trade journals and magazines.
• If your business name conflicts with a registered trademark or is similar to another name. To check this visit the Trade Marks Registry of the Patent Office at www.patent.gov.uk
• Whether your business name has words that imply national or international pre-eminence, representative status, specific objects or functions. If so, you will need the approval of the Secretary of State for Trade & Industry before you can use it. More detailed information and examples are available from the Business Names section at Companies House, Cardiff or Edinburgh or visit www.companieshouse.gov.uk and clicking on 'Guidance Booklets & FAQ' and then 'Business Names'.

To logo or not to logo
It is not mandatory to have a logo for your business, but it is recommended as it can build greater customer awareness. A logo could be a word, typeface, colour or a shape. The Coca-Cola name is a logo because of its distinct and stylistic writing. Choose your logo carefully. It should be one that is easily recognisable, fairly simple in design and one which can be reproduced on everything associated with your business. Having a logo designed by a professional designer might be a good investment, as design can be a crucial element in the success of your business.

Suggested next stage: How to write a business plan