Are you interested in learning more about licensing and distribution agreements to leverage IP and expand your business opportunities? Licensing and distribution agreements allow other companies to make use of your business Intellectual Property or IP allowing you to increase company revenues and profits by expanding into new vertical or geographical markets.
What is Licensing?
Licensing is the legal term for allowing another company – here in the US or abroad – to use your company’s logos, business products, trade names, trademarks, images, copyrighted materials, software or other intellectual property. The licensing agreement should clearly establish the time frames and geographical markets involved, as well as how the intellectual property may be used. You may allow your logo to be placed on apparel or for toys and other tangible products. An effective licensing agreement should provide “royalties” including an up-front payment as well as a monthly fee or a percentage of sales or profits.
What is Distribution?
Distribution is different than licensing. A distribution agreement allows another business or individual to purchase your company’s products and re-sell them at a profit. Distribution agreements may include the use of intellectual property, but cannot control other factors such as operational procedures, training or processes.
Using Licensing and Distribution Agreements to Leverage IP Instead of Franchising
The use of licensing and distribution agreements to leverage IP or intellectual property provide new streams of revenue and open new potential markets without the hassle, regulatory compliance, expense and risks associated with franchising.
The more control your company places on a licensing or distribution agreement, the more you risk establishing what should legally be defined as a “franchise.” Every state has unique laws regarding franchising, and there are substantial reporting requirements and legal structures that must be in place in order to offer a “franchise.”
In many cases, a well-crafted licensing and/or distribution agreement is an excellent legal option to allow your company to leverage existing assets and IP in order to reach new markets and customers. The cost of reinventing the wheel may not be as practical as licensing IP or establishing a distribution relationship in order to get your products and intellectual property to a larger potential marketplace.
Decades of Experience in Licensing and Distribution
The Watkins Firm has more than four decades of experience in the development and implementation of licensing and distribution agreements and other business contracts. We will work with you to discuss how to leverage your established intellectual property to increase revenues and associated profits.
If you are interested in learning more about the implementation of licensing or distribution agreements to access new vertical or geographical 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.
