Good news! You’ve found a licensing partner, secured a deal and defined the terms of your agreement—but your partnership is just beginning.
Anyone with experience in the brand licensing business knows that maintaining healthy, profitable, mutually beneficial partnerships is no easy task. In most cases, brand owners want their manufacturers to create, market, and send products to stores as quickly as possible. Meanwhile, licensees generally want free use of the brand owner’s IP without strict oversight. While these partnerships may start with good intentions, frequent communication, and optimism about the future, as challenges and obstacles come up, so do conflicts.
Even successful partnerships encounter snags. But, their success isn’t measured according to the highlights, but by how well they withstand the challenges. Effective partnerships rely on strong communication and shared values to be successful.
Below, find five steps to help you nurture long and happy partnerships.
Be clear about your goals
Without a set of clearly defined goals, you and your licensing partner will only be working with your individual interests in mind. While each partner should respect the other’s intentions, when you come together to define a set of shared values, benchmarks, and vision of the future, you make it easier for everyone to meet a satisfactory end goal.
Once you have crafted a thorough, measurable goal, it becomes easier for more significant ideas, strategies, investments, decisions, and more to take place. Partners who understand each other’s ambitions can nurture long-term programs because they know each other’s purpose.
Understand your role
Brand licensing agreements can involve partners with various levels of involvement. For example, some brand owners may contribute style guides, assets or just their reputation to manufacturers who they let control the production and distribution process, while others choose to be present each step of the way.
Understanding what each party will provide and separating inceptive contributions from ongoing ones makes it easier for those in charge to track and quantify each person’s/party’s involvement. Designating each role also makes it easier to compensate each person appropriately.
Create realistic timelines
Like Rome, no licensing program was built in a day. Nevertheless, timelines are essential to the wellbeing of all programs. Assigning fixed dates for asset submissions, product tests, and launches help everyone manage their expectations and makes it possible for everyone to see if they are living up to the collective’s goals.
Timelines also help the managers overseeing the program to determine the earliest date that a product can hit store shelves and situate it against market factors such as movie releases and holidays.
Have a strategy for disagreements
Whether you like it or not, you and your partner will disagree at some point. However, there are ways to make sure that your inevitable riffs do not lead to money loss or the detriment of the relationship.
For small decisions, it may be best to give one trusted partner the final say. For more significant issues, you may want to hold a vote or invite mediators or legal professionals to guide the process.
If the disagreement is truly irreparable, you may want to have paperwork drafted that clearly outlines the terms of the partnership dissolution and saves you from financial punishment.
Depending on the duration of the agreement, representants from both sides of the agreement should conduct periodic audits. Space should be given for the managers to discuss their concerns or content about the state of the deal and to discuss next steps.
Audits allow each party to discuss updates to their style guides, manufacturing tools, the state of the market, and to discuss the possibility of future partnerships.
There is no such thing as a perfect partnership, though some do come close. Partnerships that last involve parties that are willing to spend time and energy working to meet common goals. The more interest you take in your partner’s happiness, the better your working relationship will be and vice versa.