Has your consulting or coaching business hit a revenue ceiling? There’s only so much you can charge for one day’s training, a coaching session or facilitation–assuming you aren’t Tony Robbins.
If you provide training or have a service that could be delivered by others, locally or in new markets, let’s talk about licensing. Licensing your expertise is the most efficient way to scale your business, build your customer base, extend your reach, increase your income and multiply your impact.
What is Licensing?
First, a few definitions:
- A “License” means an agreement whereby a Licensor grants to a Licensee the rights to deliver a product or service created by the Licensor in accordance with specific terms and conditions set out in the agreement.
- The “Licensor” is the individual or organization who grants a License for their product or service to a Licensee.
- The “Licensee” is the person or organization who pays a fee to receive the rights in the product or service from the Licensor.
A license is different from a franchise. A franchise sets up a copy of what has been done before. A license gives the Licensee the benefit of a successful tried and tested product or service but without the constraints of having everything totally prescribed and managed through a head office.
There are many individuals and organizations that are looking to offer successful training programs or services and are willing to pay license fees for the opportunity.
Benefits of a Licensing Program
- You will have positive cash-flow and recurring income through annual fees, paid in advance year after year.
- You can build a regional or national business quickly.
- There is no need to recruit staff or open new offices.
- The development of the business is funded by the Licensees, greatly reducing your financial exposure.
Is Licensing Right for Your Business?
Your program or service is ripe for licensing if:
- It is a unique offering, productized service or methodology.
- It has a successful track record, supported by sales history and client testimonials. In other words, you can show that it works and is effective.
- There is market demand. You have identified the gaps in the market that your service fills, and you understand how your services compare to the offerings of your competitors.
- Best practices, standards and procedures for delivering your service have been documented.
- You can show how your service can make money for your Licensees relatively quickly. Can your Licensees be up and running quickly?
- Your service enjoys a high credibility factor through your expert positioning. Even better if you have written a book or have won awards.
Types of Licensing Programs
All licenses are unique, but there are few that are the most popular and easiest to implement:
- Train the Trainers. Here, your Licensees are former clients who now provide your offering with in-house personnel. You train their trainers, provide training materials and monitor and support implementation.
- Independent Providers.
- Basic license. Licensees are freelance trainers or businesses that deliver your offering to their clients.
- Certification. Basic License plus proof of mastery of the concepts, on a one time or an ongoing basis.
Licensing enables you to tap this income potential of a network of Licensees by leveraging your core assets–your ideas and your experience–without selling your time.
About the Author
Erin Austin is a lawyer and consultant who helps the founders of expertise-based businesses build, protect and leverage saleable assets so that your business is ready to sell when you are ready to exit.