Licensing
Licensing involves contracting with a firm to allow it to use a brand name, trademark, cartoon character, designer name, or other marketable label on goods it produces and sells. In exchange, the designer or licenser, receives a royalty or fee for each item produced. This generates revenue for the licenser with no capital investment. A licenser should monitor production to be sure products meet quality standards. A careful contract defining licensed product specifications and outlining the royalty rates should be agreed to and signed by both licenser and licensee.