Intellectual property (IP) is an important intangible asset and if not protected, could be freely and legally used by others without limitation. This reduces a business’s competitive advantage.
If you're an Accountant or Business Advisor, encouraging IP protection as part of your client’s overall business model can often be the difference between their success and failure.
IP Rights protect a business’s competitive point of difference and are important when establishing a product or service in the market because they:
- reduce business risks by deterring competitors from using the protected IP
- provide ownership of the IP and ability exploit them to maximum potential
- provide a valuable bargaining tool that can be sold for financial gain
- provide the owner with a number of options to commercialise the IP through franchising and licenses.
The role of IP protection
Because it’s a novel creation, IP can be clearly defined and differentiated from other assets. Initially, protection can come from keeping the IP a secret. Subsequently, legal protection is available as a valuable alternative to secrecy to allow engagement with the market.
Types of IP rights
IP rights exist in many forms and each type provides different competitive advantages:
- Trade mark – identifies the particular goods or services distinguishing the SME’s business from other traders.
- Patent – protects how an invention works or functions.
- Design registration – protects the visual appearance of a product.
- Plant breeder’s right – protects new plant varieties.
- Copyright – automatic right that protects an SME’s original expression of ideas, but not the ideas themselves.
- Trade secrets – a proprietary knowledge that can be protected through confidentiality agreements.
You can learn more about on the types of IP.
Trade marks and your clients
A trade mark is the most common IP right that a small business should consider and helps your clients distinguish their goods and services from their competitors.
One of our trade mark examiner's shares his top tips for Accountants to help clients protect their brand:
- consider trade mark protection when registering a business name
- treat trade marks as a business asset
- know the marketplace and your competitors by starting a search with Australian Trade Mark Search
- save money by applying for the right goods or services
- get a pre-assessment of a trade mark application with TM Headstart.
We also recently collaborated with Certified Public Accountants (CPA) to present a Podcast on trade mark tips for your clients.