Preparation is the key to successful license negotiations

Hal Worsham, Managing Director, Brand Licensing at LMCA, writes in Brand Business that the key to negotiating successful license agreements lies in preparation.

Tips for negotiating good royalty rates:

1. Know the size of the market
2. Know the key players in the market
3. Know the profit margin for each product category in the license, by distribution channel
4. Know the weighted average royalty rate, in case it is easier for the parties to agree on just one rate
5. Know the average royalty rate for the category of goods being licensed
6. Know the average royalty for the license type
7. Have an understanding of (and empathy for) the up-front investment a licensee is likely to make

ktMINE is a well-positioned tool to assist.  All licensors are identified, full-text of licenses is provided, and low, high, and median royalty rates for category of goods and license types are automatically calculated.