How to Write a Licensing Proposal

by Kevin Johnston; Updated September 26, 2017
Business discussion

Write a license proposal when you want to license your intellectual property for someone else to use. This document lays out the terms and conditions for use of your company name, copyright, logo or other intellectual property for someone else to use on a product or in promoting a service. The proposal must contain certain elements to avoid confusion, misunderstandings and even lawsuits further down the road. Don't skip any steps, and make sure all of your concerns are included in writing. Don't count on any verbal agreements.

Step 1

Write the names of each company in the first paragraph. Your company name goes first, as the one offering the proposal to the second company, which you should call the client.

Step 2

Describe the product. Example: Production of stuffed bears under your name. Include a detailed description of the product, including any specifications you demand in order to have your name, logo or other company information represented properly.

Step 3

Write an estimated date for production to begin. Since you are licensing your company name, you have a right to a reasonable expectation of timeliness in the production of the product. You should indicate that after the production commencement date, if no products have been produced, you have the right to license your company information to competing products.

Step 4

Designate the minimum number and maximum number of products that will bear your name or use your copyright. You may want to set a threshold above which you will be paid more. If the product is a hit, you should receive more money.

Step 5

Explain what you will provide under the agreement. Examples include: use of your trademark, name or logo,

Step 6

Explain what rights you demand if the proposal is accepted. Examples: the right to proof a sample representation of your logo or other company representation on the product, approval of the final design, a number of sample products to use in your promotions and proof of distribution of the product.

Step 7

List all obligations the client will have under the licensing agreement. Examples: the licensing fee they will pay upon acceptance of your proposal, royalties on the sale of products, bonuses if the product sells more than the maximum amount you have licensed your name for, diligent efforts to distribute, market and sell the product and quarterly sales reports.

Step 8

Close the proposal by thanking the client for his time and consideration. Date and sign it.

About the Author

Kevin Johnston writes for Ameriprise Financial, the Rutgers University MBA Program and Evan Carmichael. He has written about business, marketing, finance, sales and investing for publications such as "The New York Daily News," "Business Age" and "Nation's Business." He is an instructional designer with credits for companies such as ADP, Standard and Poor's and Bank of America.

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