When to add Limited or LTD to a logo?

The short answer is.. NEVER. 

Why do some businesses have LTD or LIMITED as part of their logos, mainly the construction and trades industry?

As a logo designer, it is often unfortunate to be asked to retrofit this into a design - it always looks tacked on like an afterthought. Though common in the construction & trades industry, it is an unnecessary addition to a well-designed logo.

Business owners typically provide one of three reasons for wanting to add the legal destination on their logo:

1. "I want people to know that we're a real company."
2. "Our lawyer said we have to."
3. "Everyone else does it."

Unfortunately, none of these are true. Let’s take a look at each of them individually. 

1.  "I want people to know that we're a real company."

LTD is an abbreviation of Limited, stating that the business is a Limited Liability Company.

There are 3 types of companies in New Zealand:

• Limited Liability Companies - The owners/shareholders of limited liability companies are personally limited in their exposure to the company's financial obligations. This is by far the most common form of company and is designated by Limited, Ltd or Tapui (Limited) at the end of the business name (only necessary on financial & legal paperwork).
• Co-Operative - Also known as co-ops, these companies exist to provide goods or services to their members & shareholders. They are also limited liability companies and some examples include taxi businesses, dairy companies, Māori community services etc.
• Unlimited - Unlimited liability companies are rare - their shareholders personally have ultimate liability to all financial obligations of the company. This form exists to meet particular, usually foreign legal requirements. 

So in a sense, yes, displaying LTD or Limited does show that you are a 'real company.'

But are you legally obligated to include it on your logo? On your vehicle? On your building sign? The vast majority of businesses in NZ are limited, but you do not see the LTD present on every logo. Even within the construction industry itself; Hawkins, Fletcher, Naylor Love - none of them have LTD or Limited on their logos, but are in fact limited liability companies.

So why do the smaller players feel obliged to display this legal information so prominently? 

2.  "Our lawyer said we have to." 

From a legal perspective, you should have your full company name included on all financial and legal documentation such as invoices, contracts, tax returns and legal records. This is usually written above contact details, address and so on. However this is irrespective of the logo.

Historically, small start-up businesses would incorporate a company name - and then simply write it out in full. They wouldn't have a logo design - logos were just for big boys like Ford and Coca-Cola. Therefore, their full company name was included.

'Taylor & Sons LTD' written the same on everything from their shop sign to their invoices.

Now, lawyers are not particularly renowned when it comes to creative logos, branding and identities. Most of them continue the tradition of simply writing out their full company name. As an industry, lawyers, accountants and doctors have been a bit slow to come around to branding and identifying themselves creatively. So it comes as no surprise that advice from a lawyer in regards to a company logo is that it should be the full company name. 

Yet you only need to look around at what some of the big players are doing. You won't see LTD, LLC, INC, PTY or any other legal descriptor abbreviation tacked alongside the Apple, Google or Twitter logos... in fact, they don't even use words at all anymore!

3.  "Everyone else does it." 

Oftentimes, you don’t have to look very far to see a trades or building company with LTD or Limited on their logos and on their utes. Whilst most other industries have long since moved on from this, you are unlikely to see LTD added to logos for florists, beauty clinics, clothing stores, cafes, restaurants or IT firms. 

For the trades and construction industry - the idea really only continues to exist due to the 2 points we have covered. In addition, a small start-up building company will see another small start-up building company and simply follow suit. As their business expands and professional marketing and design teams become involved - their logo is soon separated from the full company name and these legal descriptor abbreviations are quickly dropped.

Summary. 

If you're starting out in business and incorporating a company. Yes, you should have your full company name on all official legal & financial documents. Your full company name will include the legal descriptor so that your position on liability is disclosed. Seeing this on an invoice does show that you are a real company. However, your logo has nothing to do with any of this.

Take a look at any of the big national brands, none of them will include LTD in their logos. A Logo is a graphic to represent your company - it is not your legal company name. Your logo is a separate entity which can use your shortened name, your trading-as name, or maybe just a symbol - no name at all!