FAQ’s

If you don’t know how licensing business is, you may found below the most frequent questions and answers on this regards.

1. What is a license?

A license is the right given by a licensor to a licensee to use a certain property (brand, character, series, movie, logo, etc)

2. What kind of license are they?

Film license: This is the right to broadcast in free or pay TV, and in theaters certain series, movies, shows, etc.

Publishing license: This is the right to use a certain property for a publishing purpose (books, comics, magazines, etc).

Home Entertainment license: This is the right to use a certain property for videos, DVD, vcd, etc.

Product license: This is the right to use a certain property for general merchandising products.

Promotion license: This is the right to use a certain property for a Promotional campaign in its envelopes, in pack products, promotional products, publicity media, etc.

3. Why acquiring a license?

Depending on the type of license, the purpose of acquiring a license might change.

For example, for a film, publishing or home entertainment license, the property becomes the product it self, so the purpose is to entertain people and improve ratings and sales.

The product licenses are a way to personalize the product and so diversify one product in to different types or models.

The promotional license is a way to promote a product creating a synergy between the product and the campaign.

4. Which is the price of a license?

Usually the price of a license is determined through the Minimum Production Quantity (MPQ) or Minimum Order Quantity (MOQ) and the product price.

The royalty is the price of the license and it is a percentage of the promotional budget and/or of the product price x MOQ or MPQ.

In some cases a Minimum Guarantee payment is requested and it is calculated based on the MOQ and MPQ, product price and royalty for the licensed period.

Sometimes the MG payment can be done in partial payments.

The monthly or quarterly royalty reported amount will be deducted from the MG. When it’s a good license, usually the licensee exceeds the MG during the 2 nd . Or 3 rd . month after launching the licensed product in to the market.

5. Which are the steps to acquire a license?

a) Choose a license which might fit with your company policies, target and product.

b) Define the territory and licensed period based on your marketing date, production and distribution timing. Usually the product licenses are for one year, the promo licenses are for few weeks or months and the film, publishing and home entertainment licenses are for more than 3 years.

c) Send the application form for the license specifying, territory, licensed period, MG, MOQ or MPQ, product price, royalty %, etc.

d) Check the draft of the contract, signed it and ask for the available art material.

e) Go through the approval process which might take from 10 to 21 days.

f) Once the product is in the market, report sales or production quantities to the licensor.