A Simple Way to Cut At Least 30% Off Intellectual Property Management Costs
The pressure on legal departments to manage the costs of intellectual property management is continuously rising. This is due in part to the increased costs of managing IP assets as well as the growth of IP portfolios across multiple industries in recent years.
While making cuts to staff and resources may seem like a simple solution to adjust to a reduced budget, these types of cost-cutting measures can have a negative impact on the business in the long term. Another method that you can use to reduce costs without adversely affecting your business is to leverage your current resources more effectively. Here are a few steps you can take to better leverage your resources on a lower budget.
Negotiate Fee Arrangements
When a business needs to defend IP in litigation, it may require significant financing that can hinder business growth. In many cases, the budget required for litigation fees will be diverted from another area of the business. However, in some cases, a business can try to negotiate an alternative fee payment plan with their legal support services. If this is not a possibility, there are also litigation financing services to support businesses defending their intellectual property. For both scenarios, it is important to assess the likelihood of success for a claim beforehand to determine whether it is financially advantageous to purse a case. Your legal team should also investigate other potential methods for resolving disputes with lower time and cost implications, such as expert determination, mediation or expedited arbitration.
Whilst litigation can be necessary and beneficial to enforce your IP rights, it can consume monetary resources that your business can’t afford to operate without. If your business is currently in an ongoing legal case with a likelihood for success, it can use the potential monetary value of a positive outcome to raise capital for the business. This can be advantageous in cases where a large proportion of business cash flow is tied up in litigation or arbitration for several years. Without this support, a business may not have the cash flow to operate and grow, so this solution provides financing based on the value of the claim.
As a business grows, the addition of IP assets to its portfolio can become more frequent. As such, this increases the costs to maintain the IP portfolio. For this reason, effective intellectual property management requires IP benchmarking to ensure a portfolio remains cost-effective. A granular IP benchmarking project can result in significant cost savings for a business.
An IP benchmarking project provides your legal team with valuable information to make informed decisions with business and legal goals in mind. Firstly, your official, counsel and service fees can be assessed to determine the potential savings against competitive market rates. Then, fees can be renegotiated to save your business on annual external legal costs. Brandstock has worked with clients to save between 25% and 50% on their annual external costs. The information gathered in a benchmarking project can also help you to make decisions regarding the distribution of work across your in-house and external resources.
Leverage IP Assets
Through effective intellectual property management, your legal team should ensure that the IP portfolio contains assets that are relevant and valuable to the business. Then, similar to litigation valuation, a business can obtain a monetary valuation of IP assets, which can be used to raise capital for other business needs. IP asset valuation can also contribute to the overall value of the business, which can be used to increase your credit rating, issue new shares and list stock.
By valuing IP effectively, you can better leverage your IP portfolio for financial gain. If your business owns IP that is unused, but valuable in the marketplace, you may even be able to monetize these IP assets through licensing deals or consider sales offers. In any case, it is crucial to understand the value of each asset so that your business can adequately protect them while maximizing their revenue opportunity through monetization.
If your legal department is looking to significantly reduce its operating costs, our team can help you to assess different opportunities to reduce fees and leverage assets. Contact our IP specialists today to learn how you can decrease your intellectual property management costs while ensuring adequate protection for your IP portfolio.