Lima UK survey reveals two out of three companies reporting growth in 2013

Published on: 14th October 2013

The snapshot of British licensing businesses is positive, with international expansion seen as key.Lima300

A Lima UK email survey of British licensing professionals conducted at the beginning of the fourth quarter, finds that respondents are reporting a good trading year to date, with more than two thirds experiencing growth over the previous twelve months.

Nearly half (43.4%) of those responding expect that at year’s end their companies’ licensing business in 2013 will have shown at least 7% growth against their 2012 results. In addition, over 75% of all respondents expect their international business to grow in 2014. There was consistency between licensors/agents and licensees indicating good news for the whole business.

Despite the positive outlook, many challenges to licensing in general and to respondents’ own companies in particular are highlighted in respondents’ comments. These reveal that many worry about getting sufficient commitment from retailers. For example, one commented on “the lack of retailers willing to try new emerging properties and focusing only on big studio properties”, and another: “Too many licences and insufficient shelf space.”

There is, however, a clear desire from respondents to see more new licensee companies enter the field and also for brands not currently active in licensing to come forward to present new IP opportunities. One respondent stated: “We need new blood in terms of licensees” and another: “The real value in licensing for us comes from finding companies with no active licensing programme.” Several respondents also emphasise the threat from counterfeit goods.

Even better news from a UK plc perspective is the high expectation for 2014 of strong export performance. Over 75% of all respondents expect their international business to grow in 2014. Europe in general is the area in which most companies forecast growth, but many territories are quoted by respondents, with Asia, the USA, and China and Japan all figuring strongly.

Respondents’ views on trends for the next two years cover some diverse views. Many see the growth of digital properties as key. As one stated: “If someone gets it right and most importantly can sustain it and feed the beast this will be crucial…. we may stop seeing digital content as a marketing tool and begin to seriously monetise it.” Others continue to forecast growth in ‘retro’ or ‘nostalgia’ licensing. Several respondents worry about the film marketplace: “Movie fatigue” or the even more blunt “Too many films” are among the statements.

Lima asked for respondents’ overall views, and many called for new licences: “I think it is very important that more awareness is raised of the licensing business as a whole to recruit many new potential licensees and retailers into the business. The industry adds value to many businesses but the word needs to be spread wider” is one example. Others look to the growth of brands and look forward to seeing the new brands zone at BLE 2013: “I look forward to seeing if BLE’s brands hall produces a positive impact on business at/from the show.”

There is also a feeling that the licensing industry is not gaining enough attention from the Government: “Need Government initiatives and support for our creative industries like TV and film akin to what Kocca does in South Korea.”

Kelvyn Gardner, managing director of Lima UK, commented: “On the eve of Brand Licensing Europe, this is a tremendously encouraging survey. Not only are licensing businesses forecasting growth next year, but are already reporting strong increases in 2013, up to 7% growth in many cases over 2012. It’s also great news that the majority of this growth is coming from exports. We have carefully noted our respondents cry for ‘new blood’ in the industry, and for more focus on licensing for everyone, not just kids, and we will redouble our efforts to carry the licensing message to UK companies of all kinds.”

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