You want your salon name to be a household name; however, you don’t want it to be on every nail shop in town. Here’s how to keep it yours alone.
Three years ago, Susan Rogers opened Just Nails in Newark, Del. Her salon was thriving and her client list was growing until recently, when another Just Nails opened nearby. This new salon has been pricing its services below average for the area.
“I’ve lost a great deal of business because of this. My prices are: very competitive for the area, and I offer quality work. These people are using my name and charging very little,” says Rogers.
Compounding the problem is that the salon is listed right next to Rogers’ in the telephone directory.
People call around for prices, and the other salon is much lower” notes Rogers. “By the time I found out they were using my name, the directories were already printed.”
As Rogers’ experience underscores, your salon’s name is one your most valuable business assets. Clients associate your name with your work, and your business could suffer if someone else uses the same name and clients confuse the two businesses.
Rogers is opening a new salon, Hands and Tans, that will operate separately from Just Nails. She had planned to expand Just Nails, but the confusion with the other salon has forced her to start a second business and pay for another set of licenses and registration fees.
Register Your Salon’s Name
Your best protection is to formally register your business name. In most states, when you apply for a business license, you must also register your business name with your county or state (also known as a “fictitious” or “assumed” name). This means that you alone should be permitted to use that name in your county or state.
You’ll also have a better case against infringers if you use your name continuously. You can usually accomplish continuous use with the day-to-day operations of your business. Use your salon’s name on all your stationery and brochures, for example, and in all your advertising. Answer your business phone with the salon s name.
The longer and more consistently you use your name, the stronger your claim may be to exclusive use.
Laura Root, owner/operator of Face to Face (and nails, too!) in McMinnville, Ore., has another suggestion: “When I registered my salon’s name here, I also registered it in the six surrounding counties,” says Root, formerly a corporate paralegal. This gives Root a larger geographic area in which she is assured exclusive use of her business’s name.
As a large corporation with several franchises, the Dallas-based NailsNow! franchise federally registers its trademarks. This gives the company exclusive use of the name for nail salons in the United States, as well as the right to use the registered (®) mark after its name.
For most small businesses, however, federal registration is unnecessary. The process is time-consuming and expensive: Ira Bloom, CEO of NailsNow!, recalls that it cost his company in excess of $ 10,000 to register his trade name. For most local or regional salons, registering with the state or county in which you operate is sufficient.
As Rogers discovered, though, filing your business name with the state or county won’t always protect you. “Just Nails” was registered with the state, but the new salon was mistakenly permitted to file using the same name. If the state had properly registered Rogers’ salon name, the have noticed her trade name on file and denied the new salon’s registration.
To guard against infringement, stay aware of what others are doing. Many large companies use clipping services to monitor when someone uses one of their trademarks. These service’s monitor advertising and other media for use of a particular trademark or trade name.
Most small business owners, however, need not take such extreme measure’s. Just keep aware of new salons and check advertisements to be sure no one is using your business’s name improperly.
If you do find someone using your trade name, take action. Start-now by talking to a lawyer, who can help you determine what steps you can take to protect your business’s name.
Litigating to protect your trade name can be overwhelmingly expensive and time-consuming. It can also be difficult to prove that von have been damaged by infringement. Wheal Rogers met with her lawyer, he told her that to recover damages she would have to demonstrate her salon’s income so they could quantify the damage her salon has experienced from the confusion.
“Since this new place has opened,” she says, “they’re generating more income than I am. My lawyer said they could even sue me. I would have to put up a $10,000 bond in case they countersued.”
The owners of the second salon we’re allowed to register their name, and the salon was financially successful. If they were to argue that their salon is the one the public associates with the name Just Nails, even though they opened after Rogers’ salon, they could claim that Rogers’ use of the name confused customers and harmed their business.
“If you don’t defend your mark, you’ll lose it,” says Bloom. “If someone infringes, send a letter from your attorney telling them to stop. If they don’t, you can get a temporary injunction and sue them.”
Filing suit is often the best option for large companies. Litigation, though, is often too costly and bothersome for smaller businesses.
Name and trade name protection isn’t a problem only for small salons. Large salons also have difficulty protecting their business names. Bloom has often encountered trade name infringement. According to Bloom, NailsNow! is currently suing an infringer who, against his own attorney’s advice, insists upon using the NailsNow! trademark.
Even if you choose not to sue, you should still contact the other salon using your name. Send a letter explaining that you are a previous registered user of the name, and ask them to cease using it.
If you do end up taking legal action, document any communication you have with the other user about your trade name. Keep copies of all correspondence, and note the dates and details of the conversations.
“I wouldn’t call the authorities right away,” says Root. “I would suggest trying personal contact first. As with any neighborhood problem, you don’t want things to escalate.”
So if you look out your window and see a sign going up with your salon’s name on it, talk to whoever is using the name. Ask if they’re registered (if they are, your problem is with your county or state, not with the new user), and if they know you are already using that name. Try to work out an agreement. Be aware, though, that registration is designed to protect you and the law is on your side. While nothing can absolutely guarantee that you will be the only one to use your name, as Susan Rogers learned, your best defense is still to register your trade name, use it, and be alert to possible infringements.