International Business

Literature Review

Licensing is a business agreement in which one company gives another company license to manufacture its product for a specified payment (royalty).  Licensing fees consistently amount to a small percentage of the sales price but can increase quickly. Licensing is a billion-dollar retail exchange around the world. Be that as it may, a license isn't a formula for moment achievement. It gives licensee obtained enthusiasm of a name that is either extraordinary or has some customer acknowledgment, yet despite everything it takes great offering and promoting to succeed of brand name. In all, license gives the licensee rights in property without transferring the ownership.

In licensing model, an inventor builds up an advancement and to ensure that development through a patent, copyright, trademark, or competitive innovation, and accordingly creates intellectual property. The inventor – the proprietor of the protected innovation – then licenses the development or innovation to a third party whose obligation it is to popularize the innovation. As remuneration for licensing another gathering to utilize its protected innovation, the licensor will get a sovereignty. The vehicle through which the privilege to utilize the protected innovation is exchanged from the proprietor to the client/licensee is known as a licensing understanding, and it is the premise for the licensing business model

Generally, license is a marketing tool with great degree of cost effectiveness if licensor utilized well.  Licensing has numbers of advantages. Such as it might mean licensee have something one of a kind le competitors don’t have, it might mean showing signs of improvement margin since it's unique, Also, it might imply that 10 percent of the retailers licensee approach that licensee have never possessed the capacity to offer to will at long last examine in light of the fact that you have something different. However, there are couple of quicker or more beneficial approaches to develop a business than by licensing patents, trademarks, copyrights, designs, and other intellectual property to others. Licensing gives licensee a chance to instantly tap the current production, marketing and advertising frameworks that different organizations might have invested decades building. As a return, licensee get a rate of revenue from products or services sold under their license.

No doubt, preparing for licensing indeed caused frustration to licensee while they are doing research in what business to go for. Be that as it may, if they are willing to put extra time and efforts into making their product work, purchasing the licensing rights to a famous product or name can significantly expand their odds for achievement.

Software licensing would be the best practice. As software change rapidly due to the technology advancement and it is no longer adequate to offer one software license to fulfil all the client requirement hence this force software vendor to revaluate the way the run the business. For example, from the front-end with better approaches to license their products to the back office, where the privilege administration (the operations that distinguish what level of bolster, support, and redesign a client is qualification to receive) has been finished by hand or with not exactly satisfactory home grown qualification administration frameworks. The software vendor will in charge of the use of all updates, redesigns and upkeep of programming and facilitating environment. This help licensee to save costs.