How to know the worth of your Trademark?

How to know the worth of your Trademark?

Introduction

Brand names are used to recognize an organization's unique items and services from those of others in the marketplace. Valuation of trademarks is a process used to decide how much an organization's distinctive brand name is worth. If a company's trademark carries associated goodwill, the process of brand name valuation will be like that of a brand valuation. The brand name valuation must follow ‘Provisions on Appraisal’. 

What are a Trademark and its importance?

A Trademark is a word, expression, symbol, or design, or a combination of these that recognizes and distinguishes the source of products of one party from those of others.

Brand names are significant because, supposing that you make a quality item; you need to ensure that customers can quickly recognize your item without confusing it with different items, particularly other lower quality products. Reputation is important, and brand names help secure your reputation.

Determination of Trademark Value

 To determine the estimation of your brand name, the following elements are considered:

• The geographic situation of activities (Regional, European);
• The budget allocation for business and marketing development;
• The notoriety of your brand;
• The current and future operation modalities of your brand;

Methods of Trademark Valuation

• Income Approach- This method evaluates the revenues that might be created from the brand name in its monetary life, factoring risks and financial costs into the condition and future cash flows discounted to arrive at the NPV. This technique presents difficulties as it depends more on the result of future occasions instead of past execution.
• Market Approach- This method is a more solid technique to decide a trademark's value since it considers ongoing business sector performances. Transactions involving sale, purchase, franchising, or licensing of IP rights are used as indicators in this method.
• Cost Approach- This method considers different costs associated with creating or making a brand name and the estimated time and expenses acquired in replacing the current brand name with one that has identical strength to that of the previous. Expenses include factors, such as labor, material and equipment, research work, testing and preliminaries, regulatory approvals and important certifications, IP registration, and other overhead expenses. The main faults to this technique might be an over-emphasis on costs rather than benefits, and neglect of future value of the brand name.
•  Relief-from-Royalty Approach- Under this method, brand name valuation calculations ordinarily incorporate present estimation of the stream of revenues every year after tax, and the current estimation of future income by the method of tax savings resulting from claiming capital cost allowances on a specified portion of a trademark’s cost; that being, the tax shield. Anybody keen about acquiring the right to this brand name would need to go into a business agreement with the first owner, like a licensing agreement. This method in these cases ideally reflects the estimated rate of decrease in the original brand name's market position.

Thus, there is no set methodology/technique to assess brand names; all brands and related brand names must be seen independently and their benefits decided on a case-to-case premise. Presence of mind, instinct, and a great experience be that is needed to decide a brand name's worth and expert brand name lawyers, corporate advisors and marketing specialists should choose which of the method to use.

How one can know about his/her Trademark worth?

Determining a brand's worth is a significant piece of convincing financial investors and leadership to put in brand improvement. Though goodwill is intangible, it forms a generous portion of the brand's worth. Numerous factors must be considered to assess the value of goodwill. These incorporate future opportunities for the brand name value to be expanded and competitive risks that may threaten the estimation of the brand name.

Risks that are identified with a brand name can be not quite the same as the risk of business encounters in general. Sorting out additional advantages or risks ensures an estimation that is more precise of the fair value is taken for the brand name.

The brand names valuation is a trademark of chosen functional furniture item "NEO chair" for instance, inspect the contents of the attractiveness and possibility of such brand names to evaluate its worth. "NEO chair" is May 8, 2014, The B's protected innovation rights set up in Incheon, November 2014 is the momentum model and factory stat equipment has been finished. This survey is trademark “NEO chair” and expects a similar organization that created prior to the relevant domestic and international trademark, by December 1, 2014 models to evaluate the fair value of its trademark.

Conclusion

Trademarks are the same as described for the evaluation because it expects the past transaction; it is desirable to assess how fair enough deal to convince the parties. The use of the valuation method proposed to encourage brand name valuation and evaluation related to the measures that can be used on the hands.

To know more about, Trademark valuation process, see the video below-

BY-

ANKITA MISHRA