Are you looking for ways to expand your business? One effective strategy is to increase business opportunities with licensing or distribution. Licensing or distributing agreements could open new vertical markets and geographical opportunities. Licensing and distribution are quite different from “franchising” your business and that is an important distinction in this conversation. Franchising is a substantial legal and operational undertaking, and it may not be necessary to consider franchising to accomplish the goal at hand.
Licensing agreements allow another company or business to make use of your intellectual property in return for “royalties.” Royalties represent a payment for the use of your intellectual property and are usually based on an up-front payment and then a regular payment of royalties based upon the actual usage or implementation of your intellectual property. For example, if your company created a type of “shopping cart” software for e-commerce sites you could license it’s use for individual companies or for large regional, national and international interests who could build it into their own software offerings or websites.
Distribution usually relates to the ability to purchase the goods and/or services offered by your company at an established price and then integrate them into the products and services offered by the “distributor” or to simply offer them in a market you are not presently serving at a mark-up. Distribution agreements are usually limited to a specific geographic territory or a vertical market niche.
The opportunities to increase business opportunities with licensing or distribution agreements are based upon expanded sales and increased profits while reducing your own economies of scale. The challenge is to secure the ownership of your brands, intellectual property, patents, products and services so they may be used or offered by another party, without losing control of the properties themselves or the uniqueness of your own business model.
The attorneys at the Watkins Firm provide sound counsel when approaching a discussion of how to increase business opportunities with licensing or distribution and your company’s bottom line profitability. We help to guide our clients as they evaluate these options and provide the agreements and contracts necessary to protect your own interests while allowing others to leverage your corporate assets for growth. Would you like to learn more? We invite you to review the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.
