What is Licencing in business?

What is Licencing in business?

Licensing: the terminology In a licence agreement, the business owner, the Licensor,grants a Licencee the right to use the licensor's brand name and/or other intellectual property rights (such as copyrights). ... Take software and database technology, for example, which are invariably exploited through licensing.

What is an example of licensing?

Examples of licenses include a company using the design of a popular character, e.g. Mickey Mouse, on their products. Another example would be a clothing manufacturer like Life is Good licensing its designs and brand in a certain country to a local company.

What is licensing and its types?

Brand and trademark licensing is a type of licensing in which a licensor permits the licensee to distribute his products using his brand name. ... A licensor can also grant permission to the licensee to manufacture and distribute its products. This type of licensing is called licensed production.

What are the different types of licensing?

How to decide between types of licensing agreements

• Patent Licensing. Patents cover science and innovation. ...
• Trademark Licensing. Trademarks are signifiers of commercial source, namely, brand names and logos or slogans. ...
• Copyright Licensing. ...
• Trade Secret Licensing. ...
• Exclusive. ...
• Non-exclusive. ...
• Sole. ...
• Perpetual.

What are the 3 P's of licensing?

protection, promotion The 3 P's of collegiate licensing are protection, promotion, and profit.

What companies use licensing?

The Top Ten Global Licensors Include:

• The Walt Disney Company – $54B.
• Meredith Corporation – $30.1B.
• Authentic Brands Group – $13.8B.
• WarnerMedia – $11.B.
• Hasbro – $7.8B.
• NBCUniversal/Universal Brand Development – $7.5B.
• ViacomCBS – $5.8B.
• The Pokémon Company International – $5.1B.

What are 2 forms of licensing?

Licensing activity comes in two forms: Licensorsgive licenses to others; licensees receive licenses from others.

How do licensors get paid?

The Licensor receives a perpetual/time bound payment as a percentage of sales in regards for using the intellectual property. You can take for example – an earning from copyright, patent on new products, and consumer product licensing more. Royalties and license are members of same royal family.

What is a typical licensing agreement?

A licensing agreement is a legal contract between two parties, known as the licensor and the licensee. In a typical licensing agreement, the licensor grants the licensee the right to produce and sell goods, apply a brand name or trademark, or use patented technology owned by the licensor.

Which is better licensing or franchising?

Franchises typically work best for service-based businesses, while licenses are more conducive to product-based businesses. ... A licensee has more control over how they run their business compared to a franchisee, whose business will be dictated by the franchise owner (franchisor).

How much does a licensing agreement cost?

If you want a licensing agreement tailored to your specific situation, most attorneys charge $100-$300 or more an hour. A simple contract typically takes about 3-4 hours, or $300-$1,200 or more -- which includes an initial draft plus revisions.

What are the disadvantages of licensing?

List of the Disadvantages of Licensing

• It increases opportunities for IP theft. ...
• It creates a dependency upon the licensor. ...
• It creates added competition in the marketplace. ...
• It is offered for a limited time. ...
• It could damage the reputation of both parties. ...
• It is not a guarantee of revenues.

Does Mcdonalds use licensing?

Appointment of The Joester Loria Group follows last year's introduction of Golden Arches Unlimited online store. As the chain's global licensing agent, JLG will develop collaborations and collections of licensed products aimed at fans across the world. ...

How much can you make from licensing a product?

It's creativity and productivity on your own terms! Having this type of freedom and flexibility in your life is worth more than money to many of you. And you may not become a millionaire, but you can easily earn $50,000, $100,000, or even $200,000 per year from licensing your ideas when you play it smart.

What does FOB mean in licensing?

FOB stands for "free on board" and indicates when liability and ownership of goods are transferred from a seller to a buyer.

Which is better franchising or licensing?

Franchises typically work best for service-based businesses, while licenses are more conducive to product-based businesses. ... A licensee has more control over how they run their business compared to a franchisee, whose business will be dictated by the franchise owner (franchisor).

What are the advantages of licensing?

List of the Advantages of Licensing

• It creates an opportunity for passive income. ...
• It creates new business opportunities. ...
• It reduces risks for both parties. ...
• It creates an easier entry into foreign markets. ...
• It creates self-employment opportunities. ...
• It offers the freedom to develop a unique marketing approach.

What do licensing royalties typically cost?

Although rates ranging from 3% to 8% of net sales are common, each licensing agreement is unique and the only consensus that matters with respect to royalty rates is the one that occurs between the licensor and the licensee as a result of negotiations.