What is Product Licensing and How it Works?

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Factors to be included in the licensing plan are:
The royalty structure: This defines how the licensor’s ongoing payment will be set. This should be integrated into the strategy.
Revenue Percentage: In the fee structure, a fixed percentage of the total income that the product generates is determined.
Per-Unit Fee: An amount that the licensee agrees for each unit sold in the market through distribution channels.
Combination: A mixed strategy of charging per unit of goods or services and a percentage of the revenue.
Marketing of the Product Licences:
Marketing tools are employed to promote the product, compare it with spain phone number list rivals, and stay in touch with the consumers. Good marketing practices attract companies (licensees) that are interested in expanding into new areas and providing new products and services.


New product concepts can be brought to the market by product licensing. The licensor or the owner of the asset grants the licensee to produce as well as market and sell the product for a given period and within the specified regions.

The licensee uses the intellectual property and has to give a percentage of the earned profit to the licensor. With its resources and established distribution system, the licensee manufactures the product and either markets it directly to the general public or supplies it to other firms as stated under the license for the agreed amount of time.