Licensing Strategy Formulation and Implementation
Going global with a "Made in Canada" technology
The Situation
PartMaker Ltd., a midsize Canadian auto parts manufacturer that supplies auto
part products to the OEM as well as aftermarket customers, had developed
a radically new low-cost manufacturing process. In addition, this process
produced highly reliable and safe products. Patents for the process had been
applied for in many countries.
The Challenge
In order effectively capitalize on the global market potential for the invention,
PartMaker wanted to pursue licensing opportunities in Europe. The manufacturer
had a good understanding of the European companies involved in related manufacturing
businesses, but needed to develop a strategy to determine who to approach
and what sort of licensing deal to propose.
The Solution
To assist PartMaker in formulating a licensing offering for potential licensees,
Vertex analyzed the cost structure of the industry and assessed the benefits
of the lower production costs to the potential licensees. In addition, the
financial benefits derived from the enhanced finished product were estimated.
A proposed technology licensing fee structure was developed.
The Result
PartMaker Ltd. was able to enter into license negotiations with the confidence
that an appropriate and equitable fee schedule was being proposed. In addition,
it and was able to effectively articulate the benefits of its process to
prospective licensees.
