By A.A Taofeek

1.0 INTRODUCTION
The primary objective of every enterprises or otherwise known as business
organizations is to gain economic benefits and accrue profits from the global or
local market. However, the strict competitive nature of the market cannot be
underrated in strategizing how to dominate the market, especially for Small and
Medium-Sized Enterprises (SMEs) who are yet to gain commercial strength in the
market square. Thus, it is pertinent for SMEs to understand the ways and manners
in which all their rights in relation to the economic growth and profits may be
properly, adequately and effectively maintained, managed and secured. Thus, the
understanding of Intellectual Property (IP) as it relates to Small and Medium-Sized
Enterprises (SMEs) becomes inevitable.

2.0 INTELLECTUAL PROPERTY (IP)
What is Intellectual Property?
The World Intellectual Property Organization (WIPO) defines Intellectual property
(IP) as “creations of the mind, such as inventions; literary and artistic works;
designs; and symbols, names and images used in commerce.”
Put simply, Intellectual Property (IP) refers to creations of the human intellect.
These creations are intangible assets which are reserved for the owner in order to
utilize them generally for his economic gain.

It is important to state here that businesses should take cognizance of their
Intellectual Property Rights at the early stage as entrepreneurs and businesses,
especially small and medium-sized enterprises (SMEs), oftentimes argue that they
do not have the financial capacity to engage in intellectual property without
realizing that they are already engaging in it from the inception of their commercial
activities.

  • The true-fact is that each and every entrepreneurs and businesses, including SMEs,
    engages in intellectual property in one way or another through the inventions that
    they make, the name of their products and or their distinctive logos.
    2.1 INTELLECTUAL PROPERTY & SMALL AND MEDIUM-SIZED

ENTERPRISES (SMEs)

What is the nexus, and how does IP economically assist SMEs?
Intellectual property (IP) plays a crucial role in assisting Small and Medium-Sized
Enterprises (SMEs) in several ways. These ways shall be examined below.
However, it is germane to know that the list is not exhaustive.

2.2 BRAND BUILDING AND TRADEMARKS:
a. Trademarks: One of the fastest ways to gain reputation in the saturated market
is through trademark. Registering trademark enables SMEs to protect their brand
names, logos, and symbols. This protection, consequently, not only builds brand
recognition but also builds trust and loyalty among customers. It significantly helps
in distinguishing one’s products and services from other competitors and thereby
gives the SMEs an upper hand over the competitors.
b. Certification Marks: Certification Mark is a pertinent way of assuring
customers that the products are of high standards. Certification mark may be used by SMEs to demonstrate compliance with specific standards or quality criteria,
thereby enhancing their products reputation and market positioning.

2.3 LICENSING AND COMMERCIALIZATION:
a. Revenue Generation: As stated earlier, the primary objective of the SMEs is to
accrue profits. Another feasible way for SMEs to generate income through IP is to
license their IP rights to larger companies, through which they generate additional
revenue streams through royalties or licensing fees.
b. Technology Transfer: Licensing IP can facilitate technology transfer, enabling
SMEs to expand their reach to where they would ordinarily not have had financial
capacity to reach. This will assist them to gain access to new markets, while also
benefiting from the expertise and resources of larger partners.

2.4 TRADE SECRETS:
a. Protecting Confidential Information: Generally, Trade Secret may be referred
to as any information that would offer one business an economic advantage in
trade over a rival for as long as that information remained proprietary and only
known to that business. Trade Secret may include business plans, business
processes, list of key customers, list of reliable or special suppliers, product
specifications, product characteristics, purchase prices of key raw materials,
marketing/advertising strategies, and proprietary recipes among others. It is very
important for SMEs to safeguard their valuable trade secrets from getting into the
public domain or to their competitors by implementing appropriate confidentiality
measures, non-disclosure agreements, and employment contracts.
b. Competitive Advantage: One of the immediate benefits of trade secret is that it
gives a competitive advantage to the SMEs in the market. Maintaining trade secrets

allows SMEs to gain a competitive edge by utilizing unique know-how that is not
readily available to their competitors.
2.5 INVESTMENT AND FUNDING:
a. IP Valuation: Another vital way through which IP assists SMEs is IP valuation.
SMEs is expected to evaluate its IP rights in order to realize whether or not any of
its rights has been infringed upon by the competitors as well as to know if it is
already breaching someone else’s rights. Similarly, a strong IP portfolio can
enhance SMEs’ overall value, attracting potential investors, venture capitalists, or
lenders, who may be more inclined to provide financial support based on the IP’s
market potential.
b. Collateral for Financing: IP assets, if properly managed, may be used as
collateral for securing loans or raising capital. This will provide SMEs with
additional funding options.

2.6 PROTECTION OF INNOVATIONS:
a. Patents: SMEs can obtain patents for their unique inventions, providing them
with exclusive rights to commercialize and protect their innovations from being
copied or exploited by competitors.
b. Industrial Designs: Registering industrial designs can protect the visual features
of SMEs’ products, preventing unauthorized replication and enhancing their market
competitiveness.

2.7 LEGAL PROTECTION AND ENFORCEMENT:
a. IP Enforcement: This is a very important aspect of IP for SMEs. After being
ascertained which IP rights do belong to the business or enterprise, SMEs should,

as a matter of necessity, always enforce their IP rights against infringers. This is
primarily necessary to deterring unauthorized use and preventing market dilution
or consumer confusion as well as beaming a beacon to other competitors that the
business does not take its IP rights with levity hand.
b. Competitive Defense: A robust IP strategy helps SMEs defend themselves
against infringement claims made by competitors, providing legal grounds to
protect their market position and reputation.

3.0 CONCLUSION
Stationed on the above analyses, it is safe to conclude that by effectively utilizing
and protecting their IP assets, SMEs can leverage their innovative ideas, build
strong brands, and gain a competitive edge over their competitors. This will
eventually help in contributing to their long-term growth and success in the
marketplace.
A.A Taofeek is a student of Law at the prestigious Usman Danfodiyo University
Sokoto. He can always be reached via; [email protected] ||

+2348085374513