For many businesses, suffering from cashflow restrictions, using IP as collateral has become an ever popular option.
This is certainly not the first time that the government has emphasised the need for Intellectual Property (IP) to SMEs.
In 2013 they published the results of a study which focused on ‘the role of intellectual property and intangible assets in facilitating business finance‘. This echoed findings from a 2010 investigation of nearly 800 SMEs, which showed that only half of them recognised the need for checking the IPOs trade mark registry before naming a new product or service.
Another study shockingly found that only six per cent of SMEs obtain patent protection for their innovations.
To Deborah Niven, an IP specialist at hlw Keeble Hawson, one of Yorkshires largest law firms, the benefits are clear: SMEs could be sitting on tens of thousands of pounds in Intellectual Property (IP) assets.
Often at the start of a business, only minimal consideration is given to intellectual property and contracts in order to begin trading, but over time the firm builds up a brand, develops products or services and expands along the way,” Niven explained.
Businesses may not consider IP to be high on their agenda. The most valuable IP asset might be a new product which is being developed, but the company doesnt see it as either inventive or protectable when actually it is.
An improvement to an existing product or service, or a new way of doing something, can often be protected – leading to licensing opportunities, additional income streams, or even a monopoly in the market place if they gain patent protection.
Read more about IP:
- How to protect your most valuable asset
- Getting to grips with your IP costs
- New IP law sends clear messages to potential perpetrators
Intellectual Property Office research revealed that IP Audit Plus had highlighted 31 per cent new business opportunities, with more than four in ten companies going on to exploit their IP through initiatives such as licensing and franchising.
Essentially, the audits will enable established companies to take a step back and assess where the value lies in their business.
Niven said: Audits of this nature that weve conducted enable directors and owner/managers to gain a clear picture of any IP assets, ensuring these can be managed effectively and used as part of the business growth strategy.
This awareness is particularly important where the audit has demonstrated that IP protection is key to the development and commercialisation of a particular product or service, and can also be a critical factor in valuing a business for a future sale, management buy-out or for an injection of funds from private equity investors.