Royalty Management

Royalty management and the related revenue recognition are some of the biggest challenges for licensors of intellectual property. Many are relying on outdated systems which can't handle today's complex and rapidly changing royalty models. Others have information spread across spreadsheets, departments and databases and find processing royalties a major strain on their business. The Licensing Industry Merchandisers' Association (LIMA) estimates that more than one billion dollars are lost every year due to poor royalty management. The price tag on poor royalty management is too high and many businesses have already taken the action to stay competitive.

Royalty Processing with IPM Suite

The IPM Suite's powerful Royalty Module allows businesses to track and process royalties by product and tie them to property or other contractual rights data. The ability to assign rates by rights attributes (e.g., territory, distribution channel, etc.) allows for complex rate structures and provides reporting on royalty data at a highly granular level. The Royalty Module also provides the ability to:

  • Calculate royalties based on revenue percentage, tiered or per unit sales
  • Tie royalty rates to events, revenue measures, dates or other metrics
  • Validate that royalties reported adhere to contractual terms
  • Identify and track violation sales
  • Manage minimum guarantees, royalty allocations and overages

Integration with Financial Systems

As with many modules of the IPM Suite, integration with your existing financial systems is standard and easy. The Royalty Management (RM) module can be enabled to feed royalty and overage invoices directly into your Accounts Receivable, along with any data necessary to track your revenue recognition parameters ensuring you are managing your royalty revenue properly. To achieve this, the IPM Suite's RM module provides:

  • Full real time integration with ERP financial systems for invoicing and processing royalty payments and overage invoices
  • Multi-currency support
  • Reduction in staff workload by automating validation, reducing errors and decreasing issue resolution time

Reduce Costs, Increase Efficiencies and maximize your IP

For most, processing royalties is difficult and time consuming. Auditing royalty information is out of the question. After royalties are processed businesses simply lack the abilities to verify the contract information for all deal parties. Without this necessary audit, licensors may be under paying, risking their relationship with licensees or overpaying and hurting their bottom line. As part of the IPM Suite RM has contract and deal information attached to specific royalty information on the product level. When uploading sales data, a unique identifier matches up against information in the original contract, ensuring compliance and assuring that accurate royalties are being recognized.

The RM module also allows for greater insight into your product performance. Check what products are grossing the most or least, check which are the most profitable or being used the most. Roll this information up to groups by category, territory or channel, thus obtaining a global view of your business performance.

  • Easily audit royalty information from licensees to ensure proper payout
  • Reduce costs by decreasing duplicate work and data
  • Increase visibility into your business by having a centralized royalty system that will allow you to run scheduled or ad hoc searches
  • Streamline business process of royalty processing and recognition
  • Run reports to find best or worst performing products per search criteria
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