If you have an appropriate IP strategy in place then you can earn from your IP through licensing, franchising and selling your IP. More and more Canadian companies these days are engaged in creating a viable IP strategy based on the types of IP they own. A good IP portfolio can generate income for as long as the IP is valid.
Let’s take a look at the two key sources to earn from your IP
Licensing is the creation of an agreement that gives another company the permission to use your IP for royalty. It enables you to exploit your ownership rights to create more value. For example, Pro Slid technologies, are the pioneers of the world’s most innovative rides. They knew at a very early stage that their products and services have the potential to fetch good returns. The international success of one of their rides, The Tornado, led them to follow a sustainable IP strategy. They saw to it that they got their innovations patented in whichever country/ market they ventured into. This led them to generate revenues through patent licensing, making them global leaders. Companies create an IP strategy to not just make money but also to get a competitor advantage, to acquire maximum market share. This, in turn, helps in generating income
It involves allowing other businesses or people to set up and run businesses under your name. If you have a successful business model then franchising is your bet to earn from your IP. Franchising gives the business owner a sense of control over the franchisee. Businesses earn a portion of the profits made by the franchisees. Tim Hortons, Subway, McDonald’s are all examples of franchising models.
It is important to maintain the same standard of service in every franchise as consumers will have uniform expectations everywhere from the brand. This means you have to ensure that you provide sufficient training to all the staff across franchises to follow your model properly. It requires ongoing management.
Just like any other asset, you always earn from your IP by selling it. If your IP incurs heavy expenditure and is not critical for your business then selling your IP is a good option. Companies mostly wouldn’t sell their IP as it is their source of bread and butter. But if your business is into creating things for other businesses then selling your IP can benefit you.
If you’re looking for legal advice on earning from your IP contact our legal experts at Trademarks and Patents. Our legal experts will help you in getting Intellectual Property Rights for your products and services.