Sound Manufacturing Base Facilitates Global Sourcing

Back David Halsall studies licensors' promotional efforts and media support like related movies or TV shows. Although licensed products may offer some sales guarantees, degrees of risk do remain. "About half of our licensed products have done really well and made quite a bit of profit. The others have been so-so, and we only broke even on them," Lam says. The company works with intermediary licensing agents in London. "They have connections and good relationships with licensors," Lam says. David Halsall also works directly with licensors. As a British company, David Halsall seeks contracts with sales rights for the UK. But with a growing presence elsewhere, the company wants to pin down more territory. For example, its Barbie licence for inflatables, aquatic items and sports merchandise is basically global. To recover the often-substantial costs for licensing fees and royalty payments, David Halsall negotiates contracts beyound the standard two years. "The longer, the better for us. With development time and approvals from licensors, it may take 6-12 months before we have a finished product. With a two-year contract, that leaves only 14-16 months to sell," Lam says.   "That's why we like a longer term of 3-4 years. Longer still is too risky because if the property fails to sell, you are stuck with it for longer." Despite the costs in time, money and effort, Lam is sure the company benefits from licensed products. "When a little girl goes to a store and sees Barbie-brand swimming armbands, she will ask for them."   A lot of time and effort is invested in establishing licensed products in the market, and longer-term contracts with licensees are the norm.     Back