A trademark is a sign which can distinguish goods and services from those of competitors. A good trademark can add inherent value to a company. When you consider the level of competition and number of choices out there, a distinguishing name, symbol, or phrase is essential to create brand awareness and produce a following. The goal for businesses of all sizes is to develop strong trademarks and valuing them correctly is paramount to determining overall value for a wide variety of applications, including mergers and acquisitions, venture funding, and taxation purposes. Trademarks need to be distinctive for the goods and services provided or need to be recognised as a sign that differentiates goods or services as different from someone else’s. Trademarks, and the associated goodwill, can be important legal rights supporting brands, and in such circumstances a trademark valuation will have similarities with a brand valuation.
Approaches to Valuing Trademarks
Three approaches are typically considered in determining the value of trademarks:
Cost Approach: a general way of determining a value indication of an individual asset by quantifying the amount of money required to reproduce or replace the future service capability of that asset
Market Approach: a general way of determining a value indication of a business, business ownership interest, security, or intangible asset by using one or more methods that compare the subject to similar businesses, business ownership interests, securities, or intangible assets that have been sold
Income Approach: a general way of determining a value indication of a business, business ownership interest, security, or intangible asset using one or more methods that convert anticipated economic benefits into a present single amount
Lee Goldstein the Principal of BRV has extensive expertise in providing expert valuation services to the legal profession. He has appeared numerous times as an expert witness in court. Among the cases he has worked include fraud, quantification of damages reasonable royalty, shareholder disputes, divorce, buy-outs and minority oppression.
Should you wish to discuss Trademark Valuations further, please contact us.
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