Online Incorporation MaxBlog

It kind of sounds underhanded and sneaky—coming up with a fake name to be the public face of your company. Perhaps, it’s because the thought of a fictitious name produces images of high-stakes cons, or depositing laundered and swindled cash into off-shore bank accounts.

But the reality is that filing for a fictitious name, or a doing business as (DBA) name, is perfectly honest and extremely common amongst small business owners.

There are literally hundreds of reasons why business owners decide to get a DBA name. Here are five of the most common ones:

1. Privacy. If you are the sole proprietor and owner of a business, then your legal and business names are the same. For instance, if a graphic designer named Jane Doe starts her own freelance business, the name of her company will be Jane Doe, unless she specifies a different title by filing for a DBA. For some business owners, they prefer not to have their legal name be public information, so changing the business name to a fictitious one protects their privacy.

2. A bank requires DBA name to open a business account. In many cases, banks require a DBA name if an owner wants to open a business account. So, before you are even able to finance your business, you may have to establish a name for your company.

3. A client may require a DBA name to hire you for a job. Some lines of work require the owner of a business to have a DBA name in order to be considered for a job. For example, consider our graphic designer Jane. If she is a freelance artist, and is seeking out projects from different companies, then she may be required to have a DBA name for her company (herself) in order to be contracted to do the work. Different industries have varying rules when it comes to DBA names.

4. Your company is getting involved in other areas of industry. If your company is entering into a new area or focus of business that is not represented by the name of your company currently, then getting a DBA name may be a good solution. Having a descriptive business name is important for attracting potential customers. For example, let’s say you own a lawn care business called The Yard Guys, Inc., but would also like to do backyard planning during the slower winter months. In this case, you can file for another fictitious name, such as The Yard Architects, to describe the other facet of your company.

5. Your company operates another business or website. For business owners who manage one or more companies or websites on top of their primary existing business, having two DBA names may be simpler. For instance, if you own a marketing company, but also run a business incorporation website, filing for a DBA name for the incorporation business will help keep the two separate and make it easier for customers to determine what your companies do. Also, if you own two companies that aim for two different audiences, you may want specific names that reflect the target customers.

How to File a DBA

You can file for a fictitious business name in a couple of ways. The first is by filling out the appropriate paperwork and paying the fees for your state (and sometimes your county) by visiting a local or county agency.

By far the easiest way for a small business owner to file for a DBA name is to consult the incorporation specialists at Max Filings. We can save you precious time and money. All it takes is a quick email for a price quote to get started filing for a DBA name, so visit our website today.

When you’re starting a business, it can be very easy to get overwhelmed with the details. You have to worry about the products and services you are going to provide, as well as sales, the need for office space or a store front, and all of the paperwork it takes to get a business going and keep accurate files.

We aren’t talking about the physical tools right now, though. In the modern world, the tools you need to start a business are less tangible, but in some cases just as important.

Do you have a great website?

Even if you plan to open a store front in a small, word-of-mouth type town, you can’t operate in the modern business world without a great website. Your prospects may drive by your building and see your sign, but they will often want to learn more about you before they give you their patronage, and when they seek this information, they’ll head to the internet.

With the prevalence of review and opinion websites out there, chances are someone is going to talk about you. If you don’t have your own official website for your company, then the reviews will be the only thing prospective clients can find when they do the online search.

Now imagine a misunderstanding causes someone to post a bad review of your business. That bad review can end up taking the number one spot in the search engines, so that when someone goes online to learn about your business they get a message crafted by someone unhappy with their experience.

Create an official website when you start your business, though, and you’ll be the one in control of the message.

Are you incorporated?

You may think that crafting items in your home or providing on-site services is something you can do on a freelance basis without creating a business entity, but that’s far too risky a prospect to be practical for most businesses.

It’s incredibly easy these days to incorporate online, and the benefits cannot be overstated. When you form an LLC, for example, you legally separate your business assets from your personal ones. Though you are keeping your eye on success, it’s never a wise idea to jump without a net, and operating a business without incorporating is exactly that.

Keeping your business and personal holdings separate with the use of a business entity means that should the worst come to pass and your business fails or ends up on the wrong side of a legal battle, your home and property is protected. If you don’t make sure to have this type of legal separation, everything you own is legally tied to your business, and it all becomes fair game should you end up paying a settlement or filing for bankruptcy.

Do you need a registered agent?

The process of building a business will keep you busy, and if you are planning to operate in a state outside of the one in which you reside, forming your business may require quite a bit of travel, unless you obtain a registered agent.

A registered agent serves as your representative for out-of-state business operations. He or she stands in for you in all legal matters during the process of forming your business. Some may choose to let an employee or family member serve in this capacity, but a professional registered agent carries many more benefits.

These professionals are registered with the state and familiar with all of the legal wrangling it will take to protect your business operations outside of your home state.

When you are ready to start a business, the tools you need will be many, but with the right planning you can effectively and successfully meet your goals.

In the past here at Incorporation-e, we’ve discussed whether it’s better to buy a franchise or open your own unique business. From an incorporating perspective, the processes for both options are essentially the same in most states.

But from a business perspective, it’s a very significant decision.

While franchises are great in the respect that you get support from the corporate office among other things, they’re also expensive to obtain and come with strings attached. If you’re looking for less risk, a franchise may be the way to go but it all really depends on your particular goals and situation.

(Read more about buying a franchise vs. opening your own business in our prior post)

If you ultimately decide to pursue the franchise route though, there are a few things you will need to think about before opening that next Subway or Dairy Queen.

One is costs…

In a typical franchise setup, you will have the following costs:

• Initial Franchise Fee and Setup Expenses

In exchange for consulting and using the company’s name, you will pay a fee, which sometimes can be tens of thousands, to the franchisor. There are also other costs like equipment, procuring a location and any licenses and insurance. Also, many franchisors may have a “grand opening” fee to promote their new outlet.

As with any business, you will also need to consider your staff as well.

• Continuing Royalty Payments

This essentially pays for the right to continue using the franchisor’s name. These fees may consist of a percentage of your weekly sales or monthly gross income. Even if your business isn’t earning much income, you will likely have to pay royalty fees. Also, you’ll likely be obligated for an entire term so if your business closes, you will likely have to pay the royalty fees until the end of the agreement.

• Advertising Fees

Another common cost for franchises, many companies require its franchisees pay into an advertising fund. Each company allocates these funds differently.

Another characteristic of franchises is that they are, understandably, more controlled.

While this can be helpful, it can also be frustrating if your reason for wanting to own a business is true independence.

However, franchisors usually assist their franchisees in a variety of areas, including site location, upstart, etc. Often times, they will have to approve the site before you open. Other restrictions like what you can sell, design or appearance of your storefront and method of operation may be directed by the franchisor.

If you’re considering a franchise, it would be wise to research the particular company and franchising in general. The U.S. FTC has some good resources on what to look for.

And remember – whenever you decide you want to incorporate your business, whether it’s a franchise or your own business, MaxFilings can help you easily form a corporation or LLC in any state in the U.S.

Naming your new business is probably the biggest decision you will make about your budding enterprise…it’s what the world will know and remember you as so you want it to be practical and memorable too.

And you will want to spend some time thinking about this too – don’t simply go with the first thing that pops into your head or your gut instinct. Chat it over with friends, do some research and come up with several ideas before making a decision.

Before doing any of this though you may want to do a trademark/name search to find if there are any other businesses out there using that name. You would hate to go through this arduous process just to find out that someone already has that name and has trademarked it.

Incorporating a business with a trademarked can be a costly mistake – at minimum you will be forced to change names and incur all expenses with doing that.  Next, you could be sued by the trademark owner and if you use a federally registered trademark improperly, you could really be in trouble. In this instance, a court will assume you knew the name was federally registered and consider you a “willful infringer,” meaning you could be put on the hook for large damages and the owner’s attorney fees.

If you choose to incorporate a business online with MaxFilings, we do a preliminary name check as part of our online incorporation process.

However, save yourself the trouble before hand when you’re deciding on what to call your new venture and do a quick trademark/name search (U.S. Patent and Trade Office) for your new business or products and also do some general searches on the Internet to see how the name is being used. You can also use a fee-based service like Thomson’s SAEGIS database.

Whatever you do, look into it…it will save you in the long run.

We’ve all heard the news – supposedly the worst recession in a generation is nearing an end. With the advent of bailouts and massive government stimulus, many political leaders are playing the economy up in hopes a strong recovery is under way.

Of course economic recovery would mean people can find meaningful full-time work and begin rebuilding their lives.

And of course, many entrepreneurs and small business owners have been hanging on a thread for the last two years waiting for a meaningful recovery to get underway – according to a recent National Federation of Independent Business (NFIB) study, 53% of small business owners believe the economic climate will worsen in the next six months – that’s up from 37% just a month ago!

Other tidbits from the survey – the number of businesses saying it’s harder to get a loan rose to 15%. One good bit of news, 15% of businesses say they plan to hire, which is up a couple of points from the month before.

But the NFIB’s optimism index came in at 86.8 in March. Readings below 90 for this long is unprecedented (18 months straight to be exact). Nine of the ten components the NFIB uses to arrive at this optimism index number either fell or remained unchanged from their readings in February – not the “picture of an economic expansion” as so eloquently expressed by the NFIB.

Take a look at this report to see for yourself. While the economy’s future is uncertain, don’t let that dissuade you from incorporating a business. Many successful companies got their start during the Great Depression and other recessions that have rocked the U.S. since.

If you have a good product/service that people in a recession would find useful, don’t let the economic numbers discourage you…incorporate online today and when things finally turn around, you will be in a good position to really grow your business.