When a business changes names for whatever reason, it will need to apply for a DBA to get approval for it.
Having to apply for a DBA (doing business as) may come as a surprise to some. Especially as it feels like you should be able to do what you want with your own business. But filing a DBA is nothing to be afraid of. With a little bit of understanding, you can get it done in no time. Leaving you to get on with focusing on customers and driving more sales.
This guide will help you get to grips with the ins and outs of DBA. That means helping you figure out if this is something that you need to do or not, and answering other common questions.
Simply put, DBA is when a business is operating under a name change of some form. It may be that the operating name is different from the owner’s legal name, or that of the legal partnership, LCC, or corporation.
DBA is also known as ‘fictitious name filing’. To work under a different name, the business will have to fill out an application to ask permission to do so.
Say, for example, you buy a contact center company. Its legal name is currently ‘Calls 4 You’, but you want to operate under the name ‘Customers & You’. To do this, you would have to apply for a DBA.
As part of the application, you need to put in the name you want to use. You also need to verify that another business isn’t already using that name.
Not all businesses need to apply for a DBA. The most common businesses that need to file DBAs are sole proprietorships.
When you set up a sole proprietorship, its legal name must match your own. You can then immediately trade under your given name. In some places, too, you can add a short description of the business.
So, if you want to call your business ‘Dave Smith’s Toy Train Emporium’, you don’t have to file a DBA. You can legally operate under that name.
Using your name gives you more time to focus on other aspects of the business. Like researching top eCommerce platforms or looking into a warehouse management system.
If your personal name will not be a part of the business name for your sole proprietorship, you will need to file a DBA. So, if you want to call your company, ‘The Wonderful Toy Train Emporium’, then you will need to send off an application.
Part of your growth strategy can be figuring out a unique name that speaks to your customers and which will make people want to visit your shop. That won’t always mean using your own name.
If your corporation, LLC, or partnership wants to trade under a name other than its legal name, it too will have to file for a DBA. As the future of work alters, the business might want to change their operating name to something that reflects this. For instance, they may want to change from ‘Content Creators Agency’ to ‘Remote Creators Agency’.
A lot of franchise companies end up wanting to change names when they can’t operate under the original brand name. Say a parent company is known as ‘New York Veg’. If it branches out and opens a franchise in Philadelphia, it may choose to call its new franchised branch ‘East Coast Veg’.
Think of it like learning how to fax without a fax machine. It has the same principle and outcome; it just uses a different method, so needs a different name.
Alternatively, if a company breaks off completely, but is still run by the same parent company, it will also have to file for a DBA. They will still need to state their relationship with the parent company.
This is so customers know who they are. For example, if a chocolate bar company named ‘Saturn’ started making dog food and selling it under the label ‘Dog Yum’, they would have to apply for a DBA.
Filing a DBA is a means of trading under a name different from your - or your company’s - legal name. Keep in mind that although there aren’t many restrictions on names, most authorities won’t let you have a name that is too similar to another business. So, don’t forget to check the uniqueness of your business name before filing an application.
Try, too, to make your name clear and obvious as to what you provide. The point of filing a DBA is so you can operate under a more appropriate and attractive moniker. You will have to visit your local courthouse or business authority to apply for DBA. You may also have to alert your bank and put an ad out in the local paper to make people aware of the change.