Licensing: A changing landscape

I responded last week to a fellow Retail Wire panelist’s request for opinions about the traditional “triangle” between retailers, license-holders and licensees. I find the business model is changing fast:

The Iconix model is a good example of how the traditional “licensing triangle” is changing. There are fewer national retailers, and they are interested in margin growth as well as development of exclusive brands. So it makes sense for these stores to go straight to the master licensee to lock up distribution rights and to do their own product development and sourcing. The result: One of the three sides of the traditional “triangle” is cut out of the picture, unless the retailer decides to source product from a prior license-holder.

All the more important, therefore, for licensees to reexamine their business model, to make sure they are relevant to the new breed of mega-retailer.


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