Monday, February 1, 2010

Building assets right from the start

LIsa Galbraith, CEO

When starting a new business there is a lot to think about. The most obvious first steps are registering your company and your business name and getting your domain name. But, registering your trademark is also a good idea. A trademark is an important way of distinguishing your goods and services in the market place.

What is a trademark and why have one?

A trademark is a “mark” to distinguish your goods or services in the market place. It is a type of intellectual property. It can be a phrase, or a logo or the way you package your product. But it must be something that sets your product or service apart. Once registered a trademark is a marketable and saleable commodity.

Unlike a company registration or a registered business name a trademark gives you legal rights as the owner. If someone enters your market space it stops them from using a similar mark for similar goods or services. Protecting your business value. You can license your trademark to others or resell it. So it also provides your business with an intangible commercial asset.

What are the rules for a trademark?

Not everything can be trademarked. It must be something that is distinguishable in the market place. Some words are more difficult to register than others — for example, it’s hard to register:

· descriptive terms — for example, “apple” was acceptable for computers but wouldn’t be for fruit or for a fruit shop;

· common surnames and geographical place names by themselves — for example: “Smith”, “Pappas”, “Beijing”, or “Jamaica”;

· very short combination of letters and numbers — for example: “VP” or “F9”; and

· commonly used words or phrases — for example: “Best Quality” or “On Sale”.

You can get around these issues by combining a trademark of the type discussed above with another word or logo, then that can help to make it more registrable — for example: “Smith Plumbing” would be difficult to register alone, but might be easier if you combined it with a unique logo or slogan.

IP Australia, who manages trademarks, also has a list of prohibited trademarks eg: Olympic champion or champagne. So you should also check at their website:

What is the process?

Once you have decided to register there are 3 steps:

1. You apply to IP Australia to register the trademark.

2. IP Australia reviews your application to make sure the trademark is registrable etc.

3. IP Australia registers the trademark (assuming there are no objections, etc. or that any objections are resolved in your favour).

The process can take up to 7 months to complete, but if it is accepted the trademark registration date is back dated to your application date.

So, I guess it comes down to your ambitions if you want to grow your business into a well known brand registering your trademark is an important early step.

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