This is the fifth part in a blog series that follows Oscar, a who’s opened his own barbershop in Alberta. As Oscar runs and grows his business, we’ll explore the steps entrepreneurs in Alberta must follow to start, grow, and protect their own businesses. In this chapter, we’ll see how Oscar goes about updating the name, structure, and corporate records of 2 Bits Barbershop.
After a few years in business, Oscar’s barbershop was turning a profit and seeing a steady stream of returning customers. Eventually, it was more then he could keep up with, and Oscar knew he needed to make some changes if he wanted to keep all of his customers happy. The only way he could do that was opening more locations to meet the increase in demand.
Oscar got in touch with a Business Strategist at Business Link to learn what steps he needed to take before 2 Bits Barbershop could open new locations in Alberta. Oscar learned there are three things a business owner needs to consider updating when they’re growing their business: name, structure, and corporate records. They also discussed additional considerations Oscar might need to make depending on the choices he would make while preparing his business for growth.
Changing a Business Structure
With the help of a Business Link Strategist, Oscar reviewed the different business structures available to Albertan entrepreneurs: trade names (also known as sole proprietorships), partnerships, and limited corporations. 2 Bits Barbershop was already registered as a trade name, and Oscar was interested in the funding options that incorporation would make available. Specifically, registering his business as a limited corporation would let Oscar take on investors to support the development of additional locations.
To register as a limited corporation, Oscar was informed he needed to follow these steps and complete the proper paperwork at each stage of the process. Thankfully for Oscar, an AMA Certified Business Expert could walk him through the process, and all the forms he needed were available on the AMA website.
- Dissolve the existing trade name with a Declaration of Ceasing to Carry on Business Under a Trade Name
- Ensure the chosen name for the new limited corporation is available with a NUANS request
- Register as a limited corporation with Articles of Incorporation
Changing a Business Name
Oscar was still attached to the name 2 Bits Barbershop, but since his trade name would be dissolved, it would have to be registered again as the name of a limited corporation. Oscar remembered that his AMA Certified Business Expert outlined the basic criteria that every business name should try to meet:
- Representative of the business
- Legally identified
While 2 Bits Barbershop still fit most of those criteria, he’d need to add a legal identifier in order to incorporate his business. As a Canadian business, he could choose between Limited, Incorporated, Corporation, or any of their abbreviations (Ltd., Inc., and Corp.) as his legal identifier. The Business Link Strategist that Oscar consulted with informed him that the choice was purely cosmetic, and he could simply pick the one that looked best alongside his business name. He landed on 2 Bits Barbershop Inc.
To make the name official, he just needed to bring proper identification and an Articles of Amendment Form to an AMA registry.
Changing Corporate Records
The Alberta Business Corporations Act requires that all corporations in Alberta update their records within 15 days of any changes to their address, directors, or attorneys. Oscar planned to open a central office and expand his administrative team to help carry the responsibilities of day-to-day operations. That means there were two more steps he needed to take:
- Update the business address with a Notice of Address
- Name the limited corporations directors with a Notice of Directors
Oscar found the forms he needed on the AMA website and brought them to an AMA registry to be submitted. His AMA Certified Business Expert double-checked the paperwork, and then let him know that there were a few more items he might need to think about before he was ready to expand.
Because Oscar was restructuring the business as a limited corporation, 2 Bits Barbershop Inc. would be subject to new regulations and might require additional permits. Oscar knew he could use BizPal and consult with a Business Link Strategist to find everything he’d need. As a limited corporation, Oscar would also need to start filing annual returns through his AMA online account, by phone, in-centre, or by for 2 Bits Barbershop Inc., but he had other business to handle next.