How To Make Money From Innovations
July 1999
Many clients have potential to earn considerable additional revenue from existing know-how, processes and systems developed in their own businesses. We have seen a manufacturing client develop from being a processor into a group that generates a substantial revenue from licensing fees and royalties from is technical know-how and systems. The capacity to do this is pertinent to other clients, including those in service industries too.
Here is a checklist to think of ways to transform your business and generate additional business revenue:
- Ensure no outsiders have any residual interest in what has been developed. Sometimes, residual rights may need to be assigned by the inventor or designer, but not necessarily so if the person was always an employee. Seek legal advice. As a general rule, prior written agreements should be entered into with contractors to ensure that your future intellectual property ownership stays in-house.
- An audit of processes and trademarks should be conducted to check how they are adequately protected (registered if required and registrations up to date) and that registered trademarks are being correctly used (that is, used in the form in which they are registered for the goods or services for which they are registered).
- An investigation should be made of all potential new markets for the innovative concept. Think laterally. The concept may be capable of application to a different product or a different service or a different industry. The benefit of the innovation may be capable of being transferred by way of a licence or a franchise for a particular use in another field or territory.
- Your business should budget for the costs involved in registering and protecting its intellectual property. On a cost/benefit analysis, the investment can be very worthwhile.
- Trade secrets must be kept confidential. Information should only be disclosed to outsiders when confidentiality agreements have been entered into and staff should be informed of the confidential nature of the information.
- Advice should be sought from a lawyer or patent attorney before making use of, or disclosing, any invention or new development for which a patent or registered design might be sought. Premature publicity prior to an application for a registration can make the registration of a patent or design difficult or impossible because the required “novelty” factor might be said to be destroyed.
- Licensing or royalty agreements or franchising and distribution agreements should be prepared by lawyers who will act in your interests, rather than by the lawyer of the potential user.
- Breaches of intellectual property rights should be dealt with as soon as they come to light. Contact Baldwins to protect against infringement of rights and to assist in ways to generate revenue for your business.
For further information, contact Joe Lederman at BALDWINS, Australian Lawyers & Consultants.
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