Q. I’m having trouble thinking of a name for my business. What is a fictitious name? Do I need one? How do I get one?
You have a winning business idea. You know you can get the resources and the workers. You have great ideas for marketing and distribution. Everyone you talk to believes you’ll be very successful. Then they ask, "What are you going to call your company?"
That should be simple, right?
Not necessarily. Your business name should be short, easy to remember and descriptive. It should not be misleading in any way, i.e., imply you are a licensed professional if you are not. Depending on the kind of business you start, you may have to register the name with a local or state governmental entity. More about that in a bit.
But first, keep these guidelines in mind when naming your company.
Choosing a name
Your company name is your most powerful marketing tool. It should be descriptive of what it is you intend to do. Some people like to include their own names in the business name to add personalization and to avoid conflicts with other companies’ names.
Word of mouth is a powerful marketing tool as well. So you want to be sure people can pronounce your business name easily. Shorter names are easier to remember than long, complicated ones. Be sure it’s easy to look up in a phone book; avoid unusual spellings. Avoid using “the” or “a” or “an.” And stay away from initials and acronyms that might confuse someone trying to find your name in a directory.
Think of the benefits your company offers to customers, such as speed, experience, quality of work, cost or breadth of services and include references to them in your company name.
Avoid geographical names. You never know when you might want to relocate or expand. Why limit your company’s geographic reach?
Think of the future. Don’t make your company name so limiting that you could not add more products or services in coming years without changing the business name. Try to avoid using current jargon that may fall out of usage in a few years, too.
Think it through
If you are a sole proprietor, you will need to file a fictitious name for your company. You cannot have the same name as any other business in your area. It’s best to be prepared with three or four other names if your first choices are taken by another company.
Take your time. Don’t rush this decision. Ask friends and families for opinions, and write down their reactions and other ideas you may have.
Now back to fictitious names and registration.
A fictitious name, also known as an assumed name or doing business as (dba) name, is the name used to operate a business. Since few people will use their own name as their company’s name, they must create a fictitious name for the entity through which they will transact business.
A business name is considered to be fictitious unless it contains the full name of the owners and all partners and does not imply that there are other owners. A name that includes words like company, associates, brothers or sons suggests additional owners and makes it necessary for you to file and publish the fictitious business name on company letterhead, business cards, in advertising or on your product.
How to register your name
Anyone who regularly transacts business for profit in Missouri under a fictitious name is required by law to register that business name with the Secretary of State’s office. In Missouri, sole proprietors generally file a Fictitious Name Statement. However, filing this statement does not provide any name protection, and you will not be notified if the name you filed is already being used.
If the name has not been previously registered, you can reserve your corporate name for 60 days for a $25 filing fee while the articles of incorporation are being prepared for filing. Registration forms are available online.
Legalities and trademark
Filing a name in Missouri does not prevent a national company operating in states other than Missouri from filing a suit if you infringe on their national name, logo or trademark. You may want to do a national name search or trademark search to ensure the use of the name you select. You may also want to protect the name you select by establishing a trademark at the state and/or national level.
Someone else is using my name!
If you find that someone is using the business name you selected, be sure to determine the form of organization of that business. If a sole proprietorship or partnership is using the name, you may use it as well if you so choose. If a corporation is using the name, however, you should not use it.
In Missouri, a corporation’s name must be distinguishable from the names of any active domestic or foreign corporations already registered in the state, as well as any limited partnership, limited liability partnership or any limited liability company. The name of every Missouri corporation must contain the word company, corporation, incorporated, limited or the abbreviation of one of these words.
Some business organization models, such as limited partnerships, limited liability companies and corporations, have legal protection of their business name when they file their registration with the Missouri Secretary of State. Since there can be no duplication of names for these types of entities, you may want to check on the availability of your selected name either through the Secretary of State’s office at the contact information mentioned above
At this point you might ask, “Can a sole proprietor use the same name as a corporation without the indication of corporate status (i.e. Inc., Corp., LLC, etc.)?” After all, that would make the name different. Again we’ll use an example.
If you look up the business name “Computer Solutions,” you’ll find more than 30 listings of businesses operated as sole proprietorships throughout Missouri, including listings for Computer Solutions, Inc. and other variations. However, only a handful of these businesses are active. The others existed at different times in the past.
Clearly, only one corporate form of Computer Solutions can be active at one time, while technically sole proprietors and partnerships can use the same name without the corporate reference. However, as we’ve said, filing a fictitious name with the Secretary of State does not eliminate the possibility of a corporation seeking an injunction against the use of that name. Don’t put yourself and your business in this position.
For personalized help exploring business ideas, marketing, finance, management, technology, international trade, growth or other business issues, contact a business specialist at a center near you. Or visit the full list of training courses to find an upcoming training seminar.