Annie Fashion Law Expert

License agreement in fashion..

The importance of a license agreement cannot be over emphasized. I am  sure you wondering, what a license agreement means? In legal terms,  A lincense agreement is a legal contract between two parties, known as the licensor and the licensee.

Are you aware that for many companies, licensing is an opportunity to expand, you go sky rocket with licensing. Licensing can increase a brands reach, audience and revenue through royalties.

You might ask, what part does a license agreement play in fashion? For every fashion business, a license agreement can be used. In fashion, Licensing means when a brand gives permission to a company to use their name on a merchandise.

While I was making my research, I thought to myself “why would a brand decide to license out their name?” As a brand owner you want to increase your brand value and revenue, then you should consider licensing.

Brands frequently license out the name of their companies to produce unique goods which require specialist manfracturing. Basically,  the licensee creates the products and distributes it.

The licensor(brand) benefits from the royalties that the licensee will pay to them. There is also the benefit of a wider brand awareness that is generally  allied with a larger product range.

Before seeking to license your brand, you need to consider the following;

● Do you have an established brand?
Licensing companies pick up brands that already have a grip of the market. Whether it is a boutique, your own store. It is attractive to licensing companies to already have a retail base where your designs are available and where a licensee can see has high sale capacity.

● Does your brand have a Solid Reputation?
In order to enter into a license agreement, the licensee will consider the over all reputation of your brand from the company management, to its  reputation with retailers and the availability of the product.

● Does your brand have a Trademark?
You can file on your own to get your trademark or you can consult with an Intellectual property Lawyer or a Fashion Lawyer. When a brand has a Trademark it is the only way to ensure that you have rights to the brand to license it.

In order to have a proper representation of one’s brand, the licensor must maintain a strict level of control of the manufacturing of the products.
According to Susan Scafidi, a professor at the Fashion Law Institute at Fordham University,

“Fashion history is littered with brands that formed too many license agreements, didn’t pay to quality control and in the end lost prestige, customers and revenue. A smart fashion house needs to think not only about what each potential means for the overall image of the brand.”

When a licensor(brand) doesn’t have enough control over the products, such products can be damaged. So  with fashion licensing, your brand can go from a million to a 100 million or from a million to 50 million to 0.00.

A licensing agreement can either make or break a  fashion brand, so before signing any licensing agreement consult a lawyer. As a fashion brand owner there is a need to have a full understanding of what licensing entails before delving into it.

Runway Image- Ade Bakare


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