Naming your business is one of the most important steps new business owners take. But it can also lead to legal troubles.
Some common mistakes include choosing a business name that's already taken and forgetting to register your business' name with the state, if required. Even using a name that pokes fun at a recognized brand -- like the "Dumb Starbucks Coffee" store in Los Angeles last weekend (which turned out to be a comedian's publicity stunt, Reuters reports) -- can potentially lead to lengthy litigation.
So if you're trying to come up with a name for your business, here are five legal tips to get you started:
Register a fictitious name. While using a "fictitious" name may seem strange, it's really just a "Doing Business As" (DBA) name that's used to distinguish your business name from your personal name. Business owners who don't want to use their personal name as their business name will likely need to a file a DBA with their state.
Incorporating? Check to see if your name is still available. If you want to incorporate your business, check with your state's filing office to see if your intended business name is already being used by another business. Even if it's taken, you might still be able to use it if your business offers different products or is located in a different region, according to the U.S. Small Business Administration.
Do a domain name search. These days most businesses have a website for either promotional or transactional purposes. Another legal tip for naming your business is to conduct a simple Internet search using your intended business name. If your domain name conflicts with one that already exists, registering it could result in trademark law violations -- especially if it's for the same types of goods or services in your area.
Out of ideas? You may want to hire an expert. If you're truly stuck on creating a business name, you might want to hire an expert to help you create one that's relevant to your business and consumers. Although some professional naming firms can charge as much as $80,000 to help you develop a name, it can really help build your brand's identity, suggests Entrepreneur.