Most companies own assets. They are those things that a company needs in order to produce its products or services and the things that help the company grow. A company’s assets may be tangible or intangible. Tangible assets include the company’s inventory, property, machinery, raw materials, and more. These are the things that a business owner can see or touch. However, most businesses also own certain intangible assets, which are at least as important as the tangible assets. If you have questions about your company’s intangible assets and how to protect them, consider contacting a Chicago-based intellectual property lawyer with Sullivan & Carter, LLP, by calling (929) 724-7529 to learn more.

What Are Intangible Assets?

Intangible assets are non-physical assets that have value to a business. Unlike tangible assets that can be touched like buildings or equipment, intangible assets cannot be physically touched or seen. Intangible assets include brand recognition, customer loyalty, proprietary technology, and all types of intellectual property (IP), which include patents, trademarks, copyrights, and trade secrets, according to the World Intellectual Property Organization (WIPO).

The sum of a company’s intangible assets can be the driving force behind the company’s success and competitive advantage. These assets can provide a unique selling proposition, differentiate a business from its competitors, and contribute to a company’s long-term profitability and growth.

Value and Impact of Intangible Assets

A business’s intangible assets can have significant value and impact. They can increase a company’s overall worth, attract investors, and enhance the company’s market value. For many types of modern companies, intangible assets are increasingly becoming their primary source of value.

Intangible assets can impact a company’s financial performance and success. They may generate revenue through licensing or royalty agreements. They might enable the company to save costs and have more efficient operations. Depending on the assets and the company, intangible assets can also drive innovation and product development and create customer loyalty and brand equity.

What Are the Benefits of Intangible Assets?

A business may see several benefits from its intangible assets. These assets can provide a competitive advantage by setting the company apart from its competitors. Businesses with patents or proprietary technology can offer unique features or functionalities that attract customers and retain their loyalty. Intangible assets can generate recurring revenue streams, such as from licensing intellectual property to other companies to earn ongoing royalties. This practice can provide a stable income source and contribute to the overall financial health of the business.

Intangible assets can also contribute to the long-term growth and sustainability of a company. Building a strong brand reputation and customer loyalty can lead to increased market share, higher sales, and improved profitability. In addition, certain intangible assets can act as barriers for competitors attempting to enter the market. IP rights and proprietary technology can prevent others from replicating or imitating a company’s products or services, helping it to maintain its competitive edge.

How To Effectively Manage Intangible Assets

Effectively managing a company’s intangible assets means implementing a strategic approach to ensure their maximum value and protection. Some key steps for managing these assets and leveraging them for maximum value and competitive advantage include the following:

• Identify and inventory the company’s intangible assets. Conduct a thorough evaluation of all intangible assets owned by the company, including all types of intellectual property, brand assets, and customer data.
• Assess the value and potential of each asset. Determine the market value, revenue potential, and competitive advantage offered by each intangible asset.
• Develop a comprehensive intellectual property strategy. Protect IP by applying for patents, registering trademarks and copyrights, and keeping trade secrets.
• Implement measures for maintaining and enhancing intangible assets. Invest in research and development, innovation, and brand building to strengthen and expand the value of the company’s intangible assets.
• Regularly review and update the company’s portfolio of intangible assets. Keep track of changes in the market, the competitive landscape, and applicable legal requirements to ensure that the intangible assets will remain relevant and protected.

Harnessing the Potential of Your Intangible Assets

Businesses that harness the potential of their intangible assets are better able to take full advantage of the benefits those assets can provide. These businesses can gain a competitive edge, drive innovation, and create long-term value. The following steps can help a company utilize its intangible assets:

• Invest in research and development: Continuously innovate and develop new intellectual property and technologies to give the company a valuable competitive advantage
• Build a strong brand: Invest in activities to enhance brand recognition, customer loyalty, and market positioning
• Foster a company culture of creativity and innovation: Encourage employees to generate new ideas, collaborate, and contribute to the development of the company’s intangible assets
• Establish strategic partnerships: Collaborate with other companies or experts in the industry to leverage their knowledge, expertise, and resources for developing and protecting the company’s intangible assets
• Leverage technology: Utilize tools and platforms that are applicable to the company, such as IP management software or digital rights management systems, to effectively manage and protect the company’s intangible assets

Protecting Your Intellectual Property

Protecting a company’s intellectual property (IP) is crucial for safeguarding the value and competitive advantage that these intangible assets can provide, according to the International Trade Administration. Follow these key tips to protect your company’s intellectual property:

• Apply for patents and register trademarks and copyrights. File for legal protection for inventions, brand names, logos, and creative works. A skilled IP attorney from Sullivan & Carter, LLP, may be able to assist with this process.
• Maintain strict confidentiality regarding the company’s IP. Implement non-disclosure agreements (NDAs) and confidentiality policies to prevent unauthorized disclosure of proprietary information.
• Monitor and enforce intellectual property rights. Regularly monitor the market for potential infringement and take legal action when necessary to protect your intellectual property.
• Educate employees and stakeholders. Raise awareness about the importance of protecting the company’s intellectual property and provide training on best practices for safeguarding it.
• Use technology for digital rights management and employ systems to control access, distribution, and usage of digital assets to ensure their proper protection.

With these tips, businesses can protect their intellectual property from unauthorized use, infringement, and theft. Business owners can then preserve the value and competitive advantage that intangible assets can provide.

Contact an Intellectual Property Attorney Today To Learn More

All of a company’s assets, both tangible and intangible, are counted toward the total value of the business. Because a person cannot hold intangible assets in his or her hand, determining how to protect them can be a complex process. However, both types of assets are important. If you want to protect your company’s intangible assets, consider contacting an experienced Chicago, Illinois, intellectual property attorney with Sullivan & Carter, LLP. Call (929) 724-7529 to schedule a consultation today.