Licensing - your experiences
Discussion
Can anyone give any first hand experience of working under a licensing agreement, whereby your product/s were manufactured and retailed, or perhaps if you licensed from licensees.
Whatever insight you can give or experiences you can share would be appreciated (or mistakes you learned from perhaps).
If you can, could you give an idea of the percentage figure royalties you agreed on, as I'd like to understand what products in which industries or retail sectors command what sort of percentages if possible.
Whatever insight you can give or experiences you can share would be appreciated (or mistakes you learned from perhaps).
If you can, could you give an idea of the percentage figure royalties you agreed on, as I'd like to understand what products in which industries or retail sectors command what sort of percentages if possible.
If you get a chance get yourself over to Olympia this week (today and tomorrow) and you'll find every answer you want from a show called 'Brand Licensing'
Anybody who's anybody are there this week and they'll be as to help I'm sure.
We've just built three stands there however that's as far as my knowledge goes I'm afraid.
Anybody who's anybody are there this week and they'll be as to help I'm sure.
We've just built three stands there however that's as far as my knowledge goes I'm afraid.
I ran a merchandising licensing operation for about 5 years.
The property is what is licensed to you (or others), and what it is, how important it is to sales, as well as barriers to entry to the market are what drives the price.
Something easy (in my case name, logos and insignia) which could be applied to almost any product on a non-exclusive basis, is not going to carry a huge price (10% ex vat of the net sales price being a standard in my case). The logos were protected by trade mark registration, and part of the fee went to extensive policing of the market for those selling without permission, ie you pay (a reasonable sum) because you are protected against ThiefBay knock-offs. You also got hologram stickers with a unique code on that had to be applied to the product, so that a) you were clearly official (and I could see ThiefBayers with no stickers were an easy find), and b) I then knew how many units you had sold, so no porkies on sales returns.
You need decent quality products (checked) an undertaking not to use slave labour (or not to source products from places where that's likely) to be able to properly reproduce intricate logos (also checked) and Product Liability Insurance, which is not public liability insurance (must have explained that 500 times), as under trade mark law the owner of a trade mark is jointly and severally liabile in the event of product fault, so the TM owner wants to make sure you are insured. Some TM owners have that themselves and build in your contribution to the cost.
Big name brands = bigger fees because they have no shortage of people wanting to use them, new/ not well known/ niche stuff usually cheaper as you're helping to build their brand.
Different product categories can also carry different fees based on different markets, and the complexity of sales.
In the end it's a contract, so it's all negotiable, but how far you can negotiate depends on the strength of the owner's position.
The BLE show is pretty much "it" in UK terms, where you'll see everyone from Helly Kitty to Real Madrid exhibiting, with a million people inbetween with lovely wallpaper or wrapping paper designs they'd love John Lewis to stock from now on, to Lamborghini. Worth it for the free Chupa-Chups, 200 different lanyards, and day 2 is "mascot day", where every brand who has a character brings someone along dressed up.
I quite miss it!
The property is what is licensed to you (or others), and what it is, how important it is to sales, as well as barriers to entry to the market are what drives the price.
Something easy (in my case name, logos and insignia) which could be applied to almost any product on a non-exclusive basis, is not going to carry a huge price (10% ex vat of the net sales price being a standard in my case). The logos were protected by trade mark registration, and part of the fee went to extensive policing of the market for those selling without permission, ie you pay (a reasonable sum) because you are protected against ThiefBay knock-offs. You also got hologram stickers with a unique code on that had to be applied to the product, so that a) you were clearly official (and I could see ThiefBayers with no stickers were an easy find), and b) I then knew how many units you had sold, so no porkies on sales returns.
You need decent quality products (checked) an undertaking not to use slave labour (or not to source products from places where that's likely) to be able to properly reproduce intricate logos (also checked) and Product Liability Insurance, which is not public liability insurance (must have explained that 500 times), as under trade mark law the owner of a trade mark is jointly and severally liabile in the event of product fault, so the TM owner wants to make sure you are insured. Some TM owners have that themselves and build in your contribution to the cost.
Big name brands = bigger fees because they have no shortage of people wanting to use them, new/ not well known/ niche stuff usually cheaper as you're helping to build their brand.
Different product categories can also carry different fees based on different markets, and the complexity of sales.
In the end it's a contract, so it's all negotiable, but how far you can negotiate depends on the strength of the owner's position.
The BLE show is pretty much "it" in UK terms, where you'll see everyone from Helly Kitty to Real Madrid exhibiting, with a million people inbetween with lovely wallpaper or wrapping paper designs they'd love John Lewis to stock from now on, to Lamborghini. Worth it for the free Chupa-Chups, 200 different lanyards, and day 2 is "mascot day", where every brand who has a character brings someone along dressed up.
I quite miss it!
HoHoHo said:
If you get a chance get yourself over to Olympia this week (today and tomorrow) and you'll find every answer you want from a show called 'Brand Licensing'
Anybody who's anybody are there this week and they'll be as to help I'm sure.
We've just built three stands there however that's as far as my knowledge goes I'm afraid.
That would have been perfect, was completely unaware - thanks for the recommendation. Would have loved to attend as I have additional reasons, outside of this topic.Anybody who's anybody are there this week and they'll be as to help I'm sure.
We've just built three stands there however that's as far as my knowledge goes I'm afraid.
Will def. put it in my diary for next year or look for anything else upcoming which is similar. Have you got any recommendations for the better of the various online trade show diary sites by any chance?
The reason for asking is there's a couple of products I might want to promote in the very near future (unfortunately not able to commission a stand at the minute).
ReaderScars said:
That would have been perfect, was completely unaware - thanks for the recommendation. Would have loved to attend as I have additional reasons, outside of this topic.
Will def. put it in my diary for next year or look for anything else upcoming which is similar. Have you got any recommendations for the better of the various online trade show diary sites by any chance?
The reason for asking is there's a couple of products I might want to promote in the very near future (unfortunately not able to commission a stand at the minute).
This is my second fav show next to the toy one! This is the first one I have missed due to other commitments but well worth going to.Will def. put it in my diary for next year or look for anything else upcoming which is similar. Have you got any recommendations for the better of the various online trade show diary sites by any chance?
The reason for asking is there's a couple of products I might want to promote in the very near future (unfortunately not able to commission a stand at the minute).
ReaderScars said:
Amazing response, Croutons - much more detailed than I had anticipated. Are you operating as a consultant/advisor?
If you email sign up with whoever it is that runs BLE, they will happily send you details of their other international shows throughout the year (there really is nothing else of note in the UK), or if you can still pull an exhibitor list/ brochure (its still on today & tomorrow), you can find out who is/ was there (it will be a LONG list!) which might be useful. If, for next year, you sign up to go a few weeks before the event, you [currently] get in FOC too.Edited by Croutons on Tuesday 8th November 12:47
Thanks for the additional info, Croutons. Kicking myself for not being prepared in time.
I'm at the stage of finalising, registering the designs of, and assembling a couple of sample products that will fit into the luxury homeware sector (they'd also be appropriate for the right kind of bars and hotels).
Would have loved to get them into an environment like this Brand Licensing show for some exposure but going in without knowing what to aim for could have ended up being costly, should there have been interest in them (which I hope there will be!).
So my next question is, once these items are finalised can I possibly PM you, send you some images and maybe get some feedback/advice please?
I'm at the stage of finalising, registering the designs of, and assembling a couple of sample products that will fit into the luxury homeware sector (they'd also be appropriate for the right kind of bars and hotels).
Would have loved to get them into an environment like this Brand Licensing show for some exposure but going in without knowing what to aim for could have ended up being costly, should there have been interest in them (which I hope there will be!).
So my next question is, once these items are finalised can I possibly PM you, send you some images and maybe get some feedback/advice please?
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