International Pricing - Local Currency or GBP
Discussion
I'm in discussions to license a patent out and looking to solidify my international strategy.
The license fees etc in Britain will all be set in GBP, but for licenses granted in other countries should the fees attached to the license be in GBP as my business is registered in the UK or should the license be in the local currency of the country that the license is applicable too?
So say in the UK I'm charging a fee of £10K, should the equivalent fee in France for example be £10k GBP or 11,800 euro(equivalent of £10k gbp) or 10k Euro (£8,400)?
The license fees etc in Britain will all be set in GBP, but for licenses granted in other countries should the fees attached to the license be in GBP as my business is registered in the UK or should the license be in the local currency of the country that the license is applicable too?
So say in the UK I'm charging a fee of £10K, should the equivalent fee in France for example be £10k GBP or 11,800 euro(equivalent of £10k gbp) or 10k Euro (£8,400)?
Surely it depends on which gives the best commercial outcome overall, taking into account pricing of inputs and the finished product? Licensees won’t want excessive fix exposure, but you may/may not be able or willing to take more if it increases the chances of market success.
You’re not giving much away about what it is, but my first thought was “why is he assuming the pricing has to be equivalent/linked to that in the uk?”
In many cases you’d localise to take into account regional competition, local market pricing, etc but you need to properly figure out what that level is rather than just flip the currency symbol.
ETA; of course the other major consideration relates to the type of product, customer base, and routes to market. There are potentially big differences in the approach you’d take to something that were an invisible element of a final product, a key differentiator of a product, and an entire product in its own right. Things to consider include price transparency and grey markets if there are pricing differentials that would either irritate customers or create issues for licensees in other regions.
You’re not giving much away about what it is, but my first thought was “why is he assuming the pricing has to be equivalent/linked to that in the uk?”
In many cases you’d localise to take into account regional competition, local market pricing, etc but you need to properly figure out what that level is rather than just flip the currency symbol.
ETA; of course the other major consideration relates to the type of product, customer base, and routes to market. There are potentially big differences in the approach you’d take to something that were an invisible element of a final product, a key differentiator of a product, and an entire product in its own right. Things to consider include price transparency and grey markets if there are pricing differentials that would either irritate customers or create issues for licensees in other regions.
Edited by LooneyTunes on Tuesday 16th November 06:47
LooneyTunes said:
Surely it depends on which gives the best commercial outcome overall, taking into account pricing of inputs and the finished product? Licensees won’t want excessive fix exposure, but you may/may not be able or willing to take more if it increases the chances of market success.
You’re not giving much away about what it is, but my first thought was “why is he assuming the pricing has to be equivalent/linked to that in the uk?”
In many cases you’d localise to take into account regional competition, local market pricing, etc but you need to properly figure out what that level is rather than just flip the currency symbol.
ETA; of course the other major consideration relates to the type of product, customer base, and routes to market. There are potentially big differences in the approach you’d take to something that were an invisible element of a final product, a key differentiator of a product, and an entire product in its own right. Things to consider include price transparency and grey markets if there are pricing differentials that would either irritate customers or create issues for licensees in other regions.
Good insight there.You’re not giving much away about what it is, but my first thought was “why is he assuming the pricing has to be equivalent/linked to that in the uk?”
In many cases you’d localise to take into account regional competition, local market pricing, etc but you need to properly figure out what that level is rather than just flip the currency symbol.
ETA; of course the other major consideration relates to the type of product, customer base, and routes to market. There are potentially big differences in the approach you’d take to something that were an invisible element of a final product, a key differentiator of a product, and an entire product in its own right. Things to consider include price transparency and grey markets if there are pricing differentials that would either irritate customers or create issues for licensees in other regions.
Edited by LooneyTunes on Tuesday 16th November 06:47
I've been thinking for the European side of things I'll probably be best placed if I set up an EU office. Much to look into!
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