How a Trademark can Unlock Value for an Entrepreneur - Jet Mosquito
Mr. S.K. Matlani is an entrepreneur based in Indore in the State of Madhya Pradesh in India. In 1985, Mr. Matlani quit his job as a clerk in a bank and started a small business of manufacturing plastic buttons and pipes. In 1986, he started manufacturing mosquito repellent mats after a visit to Malaysia where he saw the project and the technology involved. He fabricated a small machine in-house and his company began selling mosquito repellent mats based on his indigenous chemical formulation under the trademark JET. The total investment in the project was around Rs. 2.5 to Rs. 3 million (some USD 65,000).
JET proved to be successful in the market and was soon competing neck-to-neck with its main competitor. In 1995, one of Indias large industrial groups, M/s Godrej Sarah Lee Limited was looking at options for entering the mosquito repellent market. Godrej Sarah Lee, entered into negotiations with both Jet and its main competitor for buying their respective trademarks. That same year, Godrej struck a deal with Jet Home Care Products Ltd for buying the JET trademark for Rs. 300 million (some USD 6,500,000). The factories set up by Mr. Matlani as well as the other tangible assets of the company remained with Mr. Matlani and have since been abandoned. The acquisition by Godrej involved exclusively the trademark which had acquired a good reputation in the Indian market. Thus, against an original investment of Rs. 3 million, this SME earned windfall profits through the sale of its trademark. With his cash bounty and high spirits, Mr. Matlani has since started a new business of soyabean products and non-GMO products.
The morale of the story is that a sound IPR strategy and intelligent management of an IPR portfolio holds the potential to deliver a far greater value than all the traditional tangible assets a business may have. A trademark symbolizes the investments made by a company in delivering and marketing a quality product. In order to enter a new market such as the market for mosquito repellant mats, all that Godrej Sarah Lee required was a reputable trademark that met with the satisfaction of consumers. For an SME like Jet Home Care Products Ltd., its trademark proved to be its most valuable asset and selling it seemed an interesting option as the entrepreneur considered that the company was reaching the limits of its growth potential.
Compiled by : Pankaj Jain, Director (IPR Cell), Ministry of Small Scale Industries, Government of India. E-mail: email@example.com