Glossary of Licensing Terms

Created by Victoria Crosby, Modified on Fri, 28 Apr, 2023 at 2:47 PM by Victoria Crosby


  • The business of granting companies the rights to develop, manufacture, market, and sell licensed products bearing brand names, marks, or licensable assets owned or held by another company for a defined term, through approved distribution channels in return for payment; typically a royalty based on wholesale sales.

  • Renting or leasing of an intangible asset.

  • Examples of Intangible assets: A song: Somewhere Over the Rainbow, A character: Donald Duck, A name: Michael Jordan, A brand: The Ritz-Carlton.

  • An arrangement to license a brand requires a licensing agreement, which authorizes a company that markets a product or service (a licensee) to lease or rent a brand from a brand owner who operates a licensing program (a licensor).

  • Process of creating and managing contracts between the owner of a brand a company or an individual who wants to use the brand in association with a product, for an agreed period of time, within an agreed territory.

  • Licensing is used by brand owners to extend a trademark or character onto products of a completely different nature.


  • The company or individual who owns or holds the rights to the licensed property, copyright, brand name, or mark, and who grants licensees the rights to develop, manufacture, market, and sell licensed products or articles via a license agreement.

  • Examples: Disney, NBA, UCLA, MGM Studios, Viacom.


  • The manufacturer to whom a license is granted by a licensor for the rights to use the licensed property in the development, manufacture, marketing, and sale of licensed products or articles.


  • A company that develops, markets, and sells licensed products or articles.


Licensing Agent

  • A company that develops and manages licensing programs for brand owners or licensors, and manufacturers or licensees.

  • The primary role of the agent is to bring the two parties together to consummate license agreements in return for a share of the royalties.

  • Examples: WME-IMG, CAA-GBG, Beanstalk, Seltzer Licensing, Rights & Brands.


  • A name or symbol used to identify a product, or line of products, typically registered or trademarked with the US government through the USPTO.

  • Brands signify that all goods bearing the mark come from, or are controlled by, a particular source and are of an equal level of quality.

  • Brands also serve to advertise, promote, and generally assist in selling goods.

Licensed Property

  • The brand, copyright, or mark owned by the licensor, which is granted for use by the licensee in the development, manufacture, marketing, and sale of licensed products or articles.

Licensed Products or Articles

  • The items (T-shirt, poster) or categories of items (toys, tabletop), bearing the licensor’s brand name, logo, mark, or licensable assets that the licensee is permitted to develop, manufacture, market, and sell.

Distribution Channel

  • Categories of retailers where licensed products or articles are sold including mass market, department stores, mid-tier, specialty stores, toy stores, bookstores, drug stores, supermarkets, internet, catalogs/mail order, and others.


  • The geographic area, typically defined by country, in which the licensor grants the licensee the right to sell the licensed products or articles.

License Agreement

  • The contract between the licensor and licensee that grants the right to use the licensed property in a specific manner in exchange for payment, typically a royalty based on wholesale sales.

  • The license agreement lays out the terms of the partnership including: legal, financial, and others.

Approval Process (Submissions)

  • An established method by which a licensee obtains authorization from a licensor, or licensor’s agent, to move forward with the manufacture and distribution of licensed products, packaging, advertising, sales materials, or other collateral materials based on submitted designs or samples.

SKU or Stock Keeping Unit

  • A unique number assigned to each piece of licensed product or article, issued by licensees and retailers.

  • The sizes and colors of licensed products each have their own SKU.

Royalty Report

  • A statement provided to the licensor by the licensee on a routine basis (typically quarterly) that describes the previous period’s wholesale sales, earned royalties, owed royalties, and details how these are computed.

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