Why are intellectual property rights important for SMEs?

Printer-friendly versionPDF version
Category: 

Intellectual property is created by most companies, whatever business they are involved in. For many of these organisations, intellectual property is even their most important asset (e.g. startup or spin out companies)

Safeguarding this possession is therefore vital and can offer SMEs many opportunities, in particular:

  • to have an exclusive set of rights in the market over their creations (for example, a patented invention allows a monopoly of twenty years, and means that a patent provides its owner with a right to prevent or exclude all others from commercially using it);
  • to obtain higher returns on their investments, since owning intellectual property rights may not only enhance the bargaining power, but may also be exploited through licences in return for royalty payments;
  • to enhance the market value and increase future profit expectations of an organisation in the eyes of investors and financing institutions.

It is therefore essential that SMEs consider protecting their creations through intellectual property and efficiently manage these assets to reap the most from their investment.