The first question on your mind is ‘how do I set up a DBA?’ Here are some useful tips that will guide you through this:
What will you be calling yourself?
The first thing that you need to look at is what you would like your name to be as your business. DBA stands for ‘Doing Business As’, so it is really important to create something that will stand out. According to the guidelines for DBA, you would be required to register your DBA, depending on the state that you are in. The law does vary depending on where you live, so you would need to check out the state guide. In order to make your brand stand out completely, you would also need to check through a trademark database and see if it exists or not. You can also create a web domain, which brings your brand to life. What is important to consider however is that if your name is too similar to another business, then according to the laws in your state, it may not be used.
Why should you get a DBA?
There are many reasons to get a DBA, but what is most important is being able to establish yourself with your DBA as a business. If you want your business to be appealing to customers, you need to think of a good name that will stand out, but also seem trustworthy. Another good reason to get a DBA is because it is easier than changing your business’ legal name. Whether you want to rebrand yourself or expand to another line in your business, a DBA is often the better solution for that.
Can you use DBA for a small business?
If you own a small business, then it is definitely advisory to get a DBA for it. It can be used as a marketing strategy, especially if you own a business that offers more than one service or product. In order to set it up you need to first verify your DBA name, fill out a registration form online and lastly you need to submit the form to a proper state office. If you are a sole proprietor then it is the right decision to get a DBA. However, it would need to be unique and not just your first and last name. It is indeed easier to come up with a name for your business, because you can get creative and mix your real name with the industry you are based in.
As a sole proprietor who wishes to get payment by using a DBA, then it is necessary to set up a bank account that links to your company. You would need to set up a DBA that doesn’t relate to your own or your partner’s name. Whether you are a small business or sole proprietor, it is necessary to also get EIN documentation and DBA paperwork in order to open a bank account for your business. It is important for you to open up a bank account with your DBA, especially if you want to create a good brand for your business and have customer loyalty.
What is not a DBA?
The downfall is that even though you have a DBA, it doesn’t offer a limited liability protection. DBA is not a legal business entity, in fact you just use DBA as a name instead of your business using a legal name. If you wish to know more about LLC and more details about DBA, then you can get more information on Startupsavant.
So is it worth it?
As Luigi Wewege, a prominent banker and fintech instructor to many startups says: “The one thing you need, is for people feel sure in e commerce because without trust, conversion rates are low. Simple things like using a DBA when your web brands are different than the company name – helps to build trust”. Joseph Lizyness, a serial entrepreneur and investor has the same opinion: “For every different brand we start, we do not form a new company. For this reason, a DBA is quick and efficient, helping brands retain trust”. As a conclusion, it is not down to whether it is worth it or not, since it is an important element to building a business. If you want guaranteed success and an attractive appeal to customers, then you should consider getting a DBA.