I’m toying with the idea of doing a name change after 10 years in business. The current name was suitable with the initial business concept, but I now feel it tends to be a bit misleading and doesn’t reflect what we’ve grown into. What do you see as the benefits/pitfalls/risks with doing this?
Many of us ask ourselves the same question as the business grows and develops in time. It’s a common problem. After all, who among us could accurately predict exactly where we’ll be, what size we’ll be, or what market we’ll be serving in 10 years time. Picking a company name is an important thing – your name helps to define exactly what your business is and how it serves, and yet, once you pick your name, it’s complicated to change.
Things to think about (pitfalls)
- The costs and effort – Changing your name is about a lot more than a business card. It’s your signs, your website(s), your truck signage, your logo, your stationary and everything and anything else with your name on it. Budget these expenses accordingly… it will add up to more than you likely expect.
- The paperwork – Love paperwork? Neither do I. However, with a name change will come a fair bit of paperwork to be processed. Your banks, your credit cards, your vendors, associations, and your utility providers may need to be provided with updated information via some time-consuming paperwork.
- Confusing existing customers – Do you service customers once or twice, or do you have long term relationships (contacts) with customers? If you have strong, regular relationships with your customers, you have more opportunities to communicate the change with them and ensure the transition is simple. If your relationships are distant, there’s a better chance your customers will be confused. Effectively communicating the name change to your existing customers had to be part of your rollout strategy.
- Confusing potential customers - If you don’t have a strategy for regularly communicating with prospects or leads, this may not be a major issue. However, if you have put a lot of effort into pursuing new leads and have a lot of relationships that ‘might’ pan out over the next 6 months, you’ll have to ensure your new name/brand is effectively communicated to your prospects.
- Amending existing contracts – Do you have existing contracts that may need to be updated based on your name change? If the contract refers to your old name, you may need to update and re-sign…
Things to think about (benefits)
- Your current name might be costing you sales! Without disclosing your name (for privacy), your name would lead a customer to believe your core business is lawn and garden maintenance, and probably favoring organic methods. If that’s your market, then your name is probably well suited. However, if you’re interested in landscape construction, your name could very well be turning potential customers away. Your company name speaks specifically to the maintenance sector of the business, and many customers will assume you don’t do construction without even checking.
- A new name can better reflect the scale of your business: As your business grows over time, or as the goals for your business change, your current name may be giving customers the wrong perception of your business. A business named after a city (e.g. Greensville Landscape) might be costing you sales in neighboring areas. A business named after a person (Tom and Ed’s Landscaping) implies a smaller company. These facts may or may not be true, but this is how your customers will see you.
- A new name is a good excuse to update your image: Although updating your image doesn’t require a name change, updating your logo enables you to stay with modern current look. Even multi-national corporations undertake image changes as trends change in customer preferences. Here’s a look at how Walmart has updated its image over time:
Some other tips for a name change…
- If you can keep your new name related to your old name, you can minimize confusion. Tom and Ed’s Landscaping might become TE Landscape Group or T+E Property Services.
In the long run, a name change is going to cause you short term pain. If your name change is going to help you achieve your company’s long term goals, then be prepared for change, but don’t hold yourself (or your company!) back because it’s work. With the right rollout strategy, a name change can be a healthy step for a growing business, and can help you achieve your goals for your company.
