Starting a business can be an exciting adventure, and as an entrepreneur or SME owner, you'll want to make sure you're on the right track. One essential aspect of this process is choosing a trade name for your company. But what exactly is a trade name, and why is it so important? In this blog post, we'll explore the concept of trade names and how they differ from company names, their importance, and some famous examples.
What is a Trade Name?
A trade name, also known as a "doing business as" (DBA) name, is the name under which a company conducts its business. It's different from the legal name of the company, which is registered with the government. A trade name is used for marketing purposes and helps customers identify your brand and services.
The Difference Between a Company Name and a Trade Name
While a company name is the official, legal name under which a business is registered, a trade name is the public-facing name that customers see and interact with. For example, if you start a business called "Smith & Co.," that would be your company name. However, if you decide to operate under the name "Smith's Supermarket," that would be your trade name.
Why Do You Need a Trade Name?
Having a trade name is essential for several reasons:
Branding: Your trade name is a crucial part of your brand identity, helping customers recognize and remember your business.
Legal protection: Registering a trade name can help protect your brand by ensuring that no one else can use the same name in your industry or region.
Professionalism: Using a trade name makes your business look more professional and established, instilling trust in potential customers.
Famous Examples of Trade Names
Some well-known companies use trade names that are different from their legal names. For example, Google's parent company is Alphabet Inc., while McDonald's Corporation operates under the trade name McDonald's. These examples show how trade names can help create a strong brand identity and make it easier for customers to connect with your business.
Conclusion
In conclusion, a trade name is an essential aspect of starting a business, as it helps establish your brand and differentiate you from competitors. As an entrepreneur or SME owner, choosing the right trade name is crucial for your success. So take the time to select a name that represents your brand and resonates with your target audience. And remember, once you've chosen your trade name, bunq can help you manage your money and grow your business with our innovative banking solutions.
FAQs
A trade name, also known as a "doing business as" (DBA) name, is the name under which a company conducts its business. It's different from the legal name of the company, which is registered with the government. A trade name is used for marketing purposes and helps customers identify your brand and services.
What is an example of a trade name? ›
A trade name is also called a DBA (doing business as) name. A good example of this is Walmart. Walmart's legal business name is Wal-Mart Inc. but its trade name is just Walmart—that's the name it uses on its advertising and website, and what most people refer to it as.
Is a trading name the same as a business name? ›
A 'trading name' refers to an unregistered name that businesses could use before the introduction of the National Business Names Register on 28 May 2012. A trading name is not a registered business name. If you wish to continue using a trading name, you need to register it as a business name.
What is the difference between a company name and a trade name? ›
Your company name is the official name under which your business is registered, representing its legal identity. While a trading name acts as an alias that can be used for commercial purposes, it isn't a legal title.
What is the purpose of a trading name? ›
A business may use as many trading names as it requires, but these cannot be registered as official names of the company. They are often used for marketing purposes to distinguish one division of the company from another.
What are 5 examples of trade name? ›
For example, there are many highly recognized companies having the other DBA name from the company's name such as Google, IBM, Walmart, Visa, eBay, FedEx, 3M, Coca-Cola, Nike, UPS, GAP, Apple, McDonald's, Microsoft, Starbucks, and so on.
Can I use my name as a trade name? ›
Can I Use My Name As A Business Name? Yes, you can use your legal name as your business or company's official name. Decades ago, many people used to name their brands their names.
What is the difference between a trade name and a LLC? ›
Difference Between an LLC Name and a Trade Name
A trade name is merely an assumed name and not a separate entity. It does not provide liability protection. It is just a name used by an LLC for marketing and advertising purposes.
What is a trade name for sole proprietorship? ›
As a sole proprietor, the legal name of your business is your personal name. However, if you want to operate under a different name, say, “Global Business Consulting Services,” you'd want to register a fictitious or "doing business as" name, also known as a DBA.
Can you have two legal names? ›
It is not illegal to use more than one name---though you will HAVE to choose one to use for all legal documents, and then ALWAYS use that full name for ALL legal and quasi legal documents.
However, there are also drawbacks to using trade names. In some cases, trade names can lead to confusion and deception, especially when they are similar to generic names or intentionally designed to cause confusion .
Do I need a trademark or trade name? ›
Although registering a trade name doesn't provide legal protection in the way that registering a trademark does, selecting a trade name should still be done thoughtfully. That's because it's the initial step in establishing an identity for your company in the marketplace.
Does LLC protect your business name? ›
LLCs do not protect business names or brand names. This means that someone could use your brand name and you would not be able to do anything about it with just an LLC. An LLC is just a way to structure a business for legal and tax purposes. You need a trademark to protect a name and stop anyone else from using it.
What is a good trade name? ›
Ideally, you want something that's: Meaningful: It communicates your brand essence, conjures an image, and cultivates a positive emotional connection. Distinctive: It is unique, memorable, and stands out from your competitors. Accessible: People can easily interpret it, say it, spell it, or Google it.
Can you sell a trade name? ›
If another business owner wants to operate under the same or a very similar name to your business, you have the option of selling the name to them. The approach you use to sell your name will vary depending on several factors, and we'll cover the most important ones here.
What are the examples of trade name franchising? ›
For example; Toyota and Chevrolet dealerships, or Pepsi and Coca-Cola soft drink bottlers, are products or trade names in which the product itself is what the franchisor is selling.
