Small and medium-sized businesses can propel their growth using trade mark protection

What you need to know (in a nutshell)

1. SMEs that own intellectual property (IP) rights are larger, have more employees, and pay higher wages than SMEs that do not own IP rights.
2. SMEs that file for at least one IP right are more likely to experience positive employment growth and high employment growth compared to those that file for no IP rights.
3. Trade marks are a key driver of growth for SMEs and filing for trade mark protection can increase the likelihood of high growth for newly established SMEs.

Full Article

IP Australia recently published a report on the role of intellectual property (IP) rights in the growth of small to medium enterprises (SMEs). The report shows that SMEs are more likely to experience high growth in employment and turnover after filing for IP rights.

It’s always interesting with statistical reports to figure out whether a particular correlation implies causation, or is simply a spurious correlation.

The report, which studied approximately 600,000 Australian SMEs between 2002 and 2017, found that:

• SMEs that own IP rights are 3.5 times larger,
• have an average of seven more employees, and
• pay higher median wages than those without IP rights.

SMEs which own IP rights are also more likely to achieve high growth: those that filed for at least one IP right in a year are 8% more likely to experience positive employment growth and 16% more likely to achieve high employment growth compared to those that filed for no IP rights.

Trade marks are a key driver of growth for SMEs, with the proportion of SMEs that own IP rights doubling from 2% to 4%. This increase in the use of trade marks is primarily in the service sector, such as information, media, and telecommunications. Additionally, newly established SMEs that filed for at least one IP right in their first year were twice as likely to experience high turnover and employment growth. The report emphasizes the importance of trade mark protection for maximizing potential growth and highlights that businesses that understand the value of trade marks and incorporate that knowledge into their operations are rewarded with higher growth and income than their competitors.

Searching for and registering trade marks can be challenging for business owners, but working with a trade mark specialist can simplify the process and help mitigate risks.