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What makes a Good Business Name

A good name is one that tells the public who you are, what you do and the fact that you are incorporated.

The discussion of what constitutes a good name can best be dealt with if we examine what names are bad. At the top of the list of bad names is the use of a number as a business name. Example: 1234567 Alberta Ltd. The public perceives users of a numbered company because you have something to hide. It seems that every time you read about a corrupt politician or a slum landlord you also read that he carried on business using a numbered company. For this reason these names have negative connotations.

The next group of bad business names are those that contain laudatory or ambiguous terms such as; holdings, enterprises, developments, investments, international, trading or communications; to name just a few, are all bad terms to use to carry on business before the public. The public has no idea what any of these businesses do, the products sold or the services offered. The failure rate among these companies is extremely high. We believe this failure rate stems from the fact that the buying public, when viewing the name, will think that the owners are trying to make the company appear to be more important than it really is, then the perception is that it is not a company that they can trust.

To demonstrate this, try forming a distinctive corporate name by adding any laudatory term; above, in the middle of the phrase Bill's ____ Ltd. Now ask yourself. What does Bill do for a living? If you saw his name in the white pages of your phone book would you be reminded to call him? Once you saw the company name would you know what products or services Bill offers? If you remembered that Bill had a business would you know what section of the yellow pages to search for his phone number? As you can see, laudatory terms do far more damage than the impression you are trying to create by using them.

The third set of bad business names are those that use initials. We can all think of a couple of companies that have used initials successfully. IBM and A&W come to mind, however, who can think of 10 more. The reason for this is simple. The public tries to associate the initials as being an acronym or abbreviation for words. When the public can not determine the meaning of the initials they have nothing to associate with the business and therefore they forget who you are. Once the public forgets who you are they stop buying from you.

The fourth set of bad business names are geographic names. Calling your business Toronto International Trading Ltd. does not qualify it as being distinctive because of the fact that there are a thousand other companies within Toronto that could be using the geographic element in their name. Even though they may not be in related business circles, there will still be this similarity between them, and that is where the public's confusion begins.

Far to many people who form companies believe that the name they select needs to be broad enough to encompass any activity that they may ever get involved in. The fact of the matter is that any business that grows to the point where it diversifies will also spin off a related company, with a new name, to pursue these new activities.

Good Names

Now that you have seen what constitutes a bad name lets examine how good names are derived. A good name consists of three elements.

First - A distinctive element.

    This is a word or phrase that clearly distinguishes your name from every other name in your field of competition. This word or phrase can be your own name or one that you have coined or invented.

Second - A descriptive character.

    This word or phrase describes to the public the nature of your work, the services you offer or the products that you sell. If you are in the trucking business, then do not be afraid to state so.

The last element is the legal element.

    Each province requires that each for profit corporation include as part of its name one of the following legal elements. Limited or Ltd., Corporation or Corp., Incorporated or Inc. All Provinces will also allow, under certain circumstances, the word "Canada" as the legal element.


A good name is one that tells the public who you are, what you do and the fact that you are incorporated. If we use our firms name as an example then;

  • the word "ARVIC" tells the public who we are;

  • the term "SEARCH SERVICES" tells the public the type of business we are in; and

  • the "INC" denotes the fact that we are incorporated.

We urge you to give your choice of name some consideration. Remember, if it works you will be stuck with it for a very long time. If it does not then you will be out of business.

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