Putting IP at the Heart of Your Business Plan
|European Patent Office, Munich|
Many new businesses are started at this time of the year. Unless it is a tech start-up little thought is likely to be given to intellectual property ("IP") by entrepreneurs and small business owners when drawing up their business plans. That is a mistake because the competitive advantages earned from designing good looking new products, innovation or establishing a reputation for good service can be entrenched by law. It is a particularly British phenomenon fostered partly by lack of awareness of IP law by many business owners and their professional advisers and partly because IP rights were until recently very expensive to enforce. Their competitors in continental Europe, Asia and North America are much more likely to incorporate IP into their business planning.
Develop an IP Strategy First
One of the reasons why British business owners and their advisers are wary of IP is that a lot of money has been wasted on patents that will never be worked or on trade mark or design registrations in countries where they will never trade. A lot of that waste could be avoided by doing the following exercise.
(1) Identify the likely income streams over the period of your business plan: these may be sales, payments for services, grants, subsidies - any kind of revenue;
(2) Consider the threats to those income streams over that period - most of those threats will be commercial such as competition from other businesses and changing customer behaviour but a few could result from copying your products or riding on your reputation;
(3) Develop responses to those threats - as most of those threats will be commercial so will your responses such as reducing prices and developing new products but such threats as plagiarism and free riding may require a legal response;
(4) Tailor your response to suit the threat and your resources - there is often more than one form of legal protection such as keeping your new product under wraps and relying on the law of confidence to keep it secret rather than seeking patent protection so consider all the options before you actually spend money on searches and applications.
Make sure that you can fund Enforcement
All litigation is expensive and IP litigation particularly so but the cost has come down spectacularly over the last 5 years with the new rules for IPEC (formerly the Patents County Court), the launch of the small claims track and alternative methods of resolving IP disputes such as IPO examiners' opinions and expert determination of domain name disputes. Enforcement costs are likely to fall still further with the unitary patent and the Unified Patent Court. There have also been entrants into the IP insurance market which means that cover against the cost of litigation is more affordable. Explore all those options for defending or enforcing your rights when you apply for your patent, trade mark or registered design.
Subscribe to a Watch Service
A watch service scours the websites and journals of the Intellectual Property Office and foreign patent offices and sometimes the technical literature for patent, registered design and trade mark applications and other developments that are likely to affect your own IP portfolio so that you can mount an early challenge if need be. Most patent and trade mark attorneys will be able to advise you on the available services. There is also a very good service from the Business and IP Centre at Leeds Central Library.
If you want to discuss this article or IP protection in general call me on 020 7404 5252 during office hours or get in touch through my contact form.