4.8.2021

How to Choose a Business Name

Written by Austin Chegini

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Starting a business is exciting, but committing to an official company name can be nerve-wracking. Consumers will judge your business by its name, and choosing the wrong one can cost you dearly. 

Let’s look at how to choose a business name that accurately reflects your business.

Why are names important?

Nielsen states brand names are one of the “most valuable assets a company possesses.” This is one of the few factors of a business that you can control, so it is best to choose a name that will resonate positively with your target audience. 

What’s more, most people form an impression of businesses in a matter of seconds. While your employees and appearance play a role in this, it’s safe to assume that your business’s name does as well. By choosing a good name that reflects your values or services accurately, you can maximize your chances of making a good impression. 

Key considerations when choosing a name

It’s easy to see why having a great name is essential, but that’s easier said than done. Let’s review some factors to consider before you choose a business name. 

Make sure it represents your brand

Most important of all, you want your name to reflect your company. Even if you have a very catchy idea, it will only be helpful if it aligns with your services and mission. 

Part of this step is choosing a name that has some meaning. For example, a home cleaning business will do well to mention “cleaning” in its name. Likewise, a restaurant will benefit from mentioning what type of food a customer can expect. 

While many startups and successful companies can get away with using meaningless names, such as Google or Yahoo, this is somewhat risky. Unless you build a strong brand identity, potential customers will not know what the name represents. 

Make sure it’s easy to understand

While this point seems obvious, many business owners still make the mistake of picking a complicated company name. All too often, people try to create a trendy, brandable name that includes a misspelling. In these cases, customers will struggle to find you online, possibly resulting in lost business. 

For example, consider the popular photosharing platform “Flickr.” The company’s website is flickr.com, but they also bought flicker.com to redirect users to the right website. Likewise, if a user searches “Flicker” instead of the actual name, they will see unrelated search results. 

Although some search engines do show the correct website in this example, the same can not be said for your new business that has no brand power.

Make sure it’s available

Business names are regulated by your state government, so you must be sure it isn’t taken already. Typically, your Secretary of State will have a name lookup tool to see if an entity under your name exists. 

At the same time, check to see if the business website is available. Ideally, you want a URL that is your complete business name. However, you can occasionally get away with a small tweak. 

For example, the law firm “Morgan & Morgan” uses the website www.ForThePeople.com. This web address works for the company because “For the people” is the business’s motto and central to their brand.

Some common mistakes to avoid 

All too many business owners expose themselves to potential issues by choosing the wrong name. Watch out for these pitfalls.

Limiting your geographic reach

It’s not uncommon to see a company mention a specific city or region in its name. For example, a cobbler in Las Vegas might come up with the name “Las Vegas Expert Shoe Repair.”

But what happens if their business explodes in popularity and they want to expand? Can they still do business as “Las Vegas Expert Shoe Repair” in other cities? 

When choosing a name, avoid mentioning a specific city, county, or possibly even the entire state. If you want to show customers you’re a local company, you can include this in your official tagline. 

Returning to the example above, the cobbler could instead choose a name like “Henry’s Expert Shoe Repair” and use the tagline “Your trusted local Las Vegas cobbler.”

Limiting your products or services

Healthy businesses are always looking for ways to draw in new customers. To accomplish this, stores might expand their inventory or service providers might offer more services. 

Unfortunately, many small business owners don’t consider this possibility when choosing their company name. Instead, they choose a name that fits their current business model but does not allow them to expand.

For example, a new business owner who pressure washes driveways and sidewalks might choose a name like “Expert Driveway Cleaning.” If they decide to offer landscaping or home improvement, they will need to rebrand. Otherwise, customers will be confused and may be hesitant to trust a driveway cleaning company to clean their home.

In this example, it might be more advantageous to choose a name like “Expert Property Care” since it covers a wide range of services. Even if the owner only cleans driveways, they can leave the door open to add new services without having to change their name. 

Sounding too similar to another business

Even if the state says your company name is available, you will want to do some research before registering your business. Since many words sound alike or can be spelled differently, you never know if you will have a competitor with a nearly identical name. 

For example, a store called “Fine Fruits” can easily be confused with a different one called “Fine Froots.” 

Choosing a name like this can expose you to legal trouble as well as damage your brand. Customers will confuse the two similar-sounding stores, reducing the brand power of each. 

Need help with your small business?

Choosing a name is only the start of owning a business. Before you can open, you’ll need to obtain licenses, acquire funds, and hire staff. Then once you open, you’ll spend nights and weekends managing operations and planning for the future. 

On top of this, you’ll need to choose the right technology to power your business. For most businesses, the most important piece of equipment is the point of sale system. With this device, you can do everything from process transactions and print receipts to take inventory and manage staff. 

Epos Now offers state-of-the-art POS systems for businesses in various industries. From small bars to large stores, we have the right tools to help you do business better. 

Contact our consultants today to learn more about our systems.

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