Understanding the Difference Between a Trade Name and Business Name

A name selection is one of the first steps an entrepreneur must take when beginning a firm. But the vocabulary used in naming can be perplexing. Trade name and business name are two phrases that are sometimes confused. However, they are not the same thing. Personal name versus business name The name of the individual or entity who owns the business is referred to as a personal name. For instance, John Smith would go by that name if he had a plumbing company. On the other hand, a trade name is the name used to do business. The same holds true if John Smith chooses to conduct his plumbing company under the name “Plumbing Pros,” in which case Plumbing Pros would be the trade name. Creating a Trade Name Registration It is not always necessary to register a business name. There are advantages to doing so, though. Legal defense against competitors using the same or a similar name can be obtained by registering a trade name. Additionally, it might make getting a loan or opening a bank account simpler. An illustration of a trade name is

Any name that a company chooses to distinguish itself might be considered a trade name. Coca-Cola, Nike, and Apple are a few examples of well-known trade brands. In order to prevent unauthorized use of these names, trademarks are frequently filed. Keeping a Trade Name Safe

A trade name can be safeguarded via trademarks. An exclusive right to use a name or logo in connection with one’s goods or services is granted by a trademark, which is a type of legal protection. The name or logo must be distinctive and not too similar to any already registered trademarks in order to be granted a trademark.

In conclusion, despite the fact that a trade name and a business name may sound alike, they are not the same thing. A trade name is the name under which the business is operated, whereas a personal name is the name of the person or entity that owns the firm. Although registering a brand name is not always necessary, it can offer legal protection and facilitate corporate operations. Legal defense against others using the same or similar names can be obtained by trademarking a trade name.