Help with running 2 businesses??

[mattley23]

Hi all,

Ive ran my own company since 2006, we are builders specialising in space solutions (garage & loft converisons, extensions, garden offices, conservatories etc etc).

Over the last few weeks ive started to set up a 2nd business with a different name specialising in EPDM flat roofing and am a bit copnfused on how to set this company up. I see that I have 2 options:

1. Rub them as totally seperate businesses and set up a new bank account and supplier accounts

2. Run the 2nd business as either a sister company, or as a trading name of my 1st business and use the same bank account and supplier accounts.

Just wondered how many other people out there run 2 businesses within the same industry and how you have decided to set them up.

Any advice would be appreciated

Thanks

[Joshua Mason-Allen]

I think running the two components of my business under one limited company with the second part under a different trading name works the best for me. It takes the hassle out of setting up another bank account, obtaining credit and so on, plus it means there's only one set of forms to fill in at the end of the year rather than two.

Plus, stating company X is a trading name of company Y can give potential customers reassurance if they've dealt with you before and can also help build a brand if that's something you're attempting to do.

I can't help thinking you're already doing the work of company 2 through company 1 and are just trying to seperate the two for whatever reason you might have. As the saying goes: "if it ain't broken, why fix it?"

Hope this helps,

[mattley23]

Didnt really want to go down the route of setting my primary business up as a ltd but i guess if it solves the prblem then its worth doing.

Also the 2nd company, Permaseal roofing, has been set up purely to specislise in EPDM flat roofing and also offer a range of general roofing services. This is something my primary business noesnt offer at the moment.

[bill mccallum]

You don't need to set up a ltd company, just trade using two names, don't need to change anything except letting people know that business B is a division of business A.

[mattley23]

Originally Posted by bill mccallum

You don't need to set up a ltd company, just trade using two names, don't need to change anything except letting people know that business B is a division of business A.

I was hoping it was that easy if im honest. My idea was to put some for of text reference on the website and stationary of Permaseal Roofing to reference the company as a sister company, something along the line of either:

Permaseal Roofing is a trading name of SGC Building Solutions
or
Permaseal Roofing - part of the SGC Building Solutions group

This way the 2 companies can have the appearance of 2 seperate companies, each with their own websites and stationary, but the mechanics of 1 business using 1 set of trade supplier accounts and banking.

[bill mccallum]

Originally Posted by mattley23

I was hoping it was that easy if im honest. My idea was to put some for of text reference on the website and stationary of Permaseal Roofing to reference the company as a sister company, something along the line of either:

Permaseal Roofing is a trading name of SGC Building Solutions
or
Permaseal Roofing - part of the SGC Building Solutions group

This way the 2 companies can have the appearance of 2 seperate companies, each with their own websites and stationary, but the mechanics of 1 business using 1 set of trade supplier accounts and banking.

You can't use the term "Group" unless you are part of a group of companies, see companies house web page on business names.

"A Division of SGC Building Solutions" sounds better anyway.

[mattley23]

Originally Posted by bill mccallum

You can't use the term "Group" unless you are part of a group of companies, see companies house web page on business names.

"A Division of SGC Building Solutions" sounds better anyway.

Ahhh, thanks for the Bill. I agree, that sounds much better anyway.

Thanks for all your advice, much appreciated.

[m8internet]

There are several options

Firstly, since you are a sole trader or partnership (ie not a limited company) your bank should be able to offer "account extensions"
You have one main bank account, and then separate bank accounts for each trading division
However, this may incur higher bank charges

Secondly, you can rename the original business and secondary business, and then advise the bank to rename the bank account accordingly
I have seen this a few times where the renamed business is the "persons name services", and that is the advice I give out to people who are unsure, as the term "services" can cover any other future business expansions

Finally, if there are different owners and you want to keep them separate, then do NOT merge the bank accounts -
Business A has owners B and C
Business D has owners B and E

[Leyla1]

Hi All

Originally Posted by bill mccallum

You don't need to set up a ltd company, just trade using two names, don't need to change anything except letting people know that business B is a division of business A.

Could I ask, have you asked your accountant what is suitable?

Will you end up paying higher taxes this way?

I'm only asking. I don't know, as I 'm newbie myself


Thanks,