Why are Trademarks Valuable?
Your Trademark is the brand identity of your business, products, and services. Your customers begin to associate your Trademark with the level of quality you offer to your customers, and the reputation you have worked steadily to build. Though at Behrends Legal, we recommend filing for a Trademark as early as a possible, your brand reputation may take years to grow, and is an investment of itself. When it comes time to merge, sell, or agree to license the brand you have built, your Trademark encompasses all that you have built into your business reputation, – symbolically, and financially.
How Do I Know What My Trademark is Worth?
Estimating the value of your Trademark can be somewhat tricky as with all intellectual property valuations. Putting a price on the future earning potential of your business brand is a complex process based on estimations, and partially, on the summation of both the past and present financial standing of the business. Because selling a Trademark as an individual asset of the company has become a common business practice, a few approaches have been formed to help guide the valuation approach.
- Cost Valuation: the amount of financial investment that would be needed to replace the Trademark with a new one. This approach ultimately produces a valuation price based the popularity of the brand.
- Market Valuation: with this approach, the value of the Trademark is estimated by comparing the Trademark with other companies that produce similar products and services as the business being evaluated.
- Income Valuation: this approach is based on the cash flow trends of the business throughout the life of the Trademark and brand usage. Trademark valuation is often bundled together with other licensing rights in the business transaction.
Understanding that your business Trademark is a valuable asset as you prepare to sell, or license your Trademark, is essential to maximize on the reputation of the brand you have built, and the investment you have made.
Call us today at Behrends Legal to get started on your Trademark Registration!