Going Limited: How to choose a company name
For many contractors, choosing your own trading name is the fun bit. Shall you just use your own name as a consultancy or brand, or do you play it straight, sticking to words that directly convey ‘what you do’ and how it benefits clients? How about something memorable or unusual, instead of the safer ‘what it says on the tin’ approach?
Looked at in isolation, these are all individual choices that you should find interesting to make. That said, bear in mind that there are also practical and legal restrictions that require more serious consideration.
In terms of business, and your professionalism, first impressions count. Add to this that, on the practical side, long-winded, complex names may be hard to pronounce (and spell) and you invite awkward conversations. Such an overly wordy business name might also make it difficult to track you later through agents or directories, owing to the greater potential for misspelling, when agents or clients search for you online.
On the other hand, including specialist skill areas (particularly sought-after ones) in your business name will make you easier to find on the likes of Google, or other searchable databases and directories. From a business perspective, one obvious downside to including skills in your trading name is that it may restrict future trade if it pigeon-holes you to too great an extent, or you may need to change your name if skills go out of date, or if you receive a legal challenge. While changing name is not a complicated process, avoid the hassle. Contractor start-ups with ‘Java’ in their trading name hear too often from an unhappy Sun Microsystems.
If you play it safe, and decide on something generic (such as IT Networking Solutions) then check for and secure a suitable domain for your company at the same time. Merely having this asset should be enough for one potential name to edge out another in your decision-making.
On the legalities of naming a ‘Ltd’, if you have a popular surname, and you choose to use that as part of the company name, then do check to see if others operate in the same field under the same title. As well as confusion, you may be seen as 'passing off' as this other company – not too dissimilar to ‘piggybacking.’
Also when naming your contractor business, you should note that Companies House restricts the use of sensitive words, but if you use the CUK company formation service you'll be advised if your chosen name falls into the restricted category. If it does, it’s probably because you’re trying to form a company using a name, or a name very similar to a limited company name already registered. Again, CUK’s service will advise you if this duplicity arises, but the limited company name-check facility will throw up most of these instances before you begin to form your company.
Further Reading: How to choose an IT contractor accountant
