Summary
- Client wanted to commercialise a new packaging technology
- Signed deals with major multinationals
- It had global ambitions, but local manufacturing
- EverEdge advised that it license the tech instead
- Earnings rose 15x in three years with this strategy
Client Information
An EverEdge client created a packaging technology that used 35% less plastic in the containers for dairy products.
The Problem
Inventing a new technology or product can be enormously lucrative if the company has the means to manufacture the idea and push it to market.
In the packaging industry, saving 2% of used plastic is considered an enormous improvement, so the company’s new technology had the potential to be disruptive.
The company’s original strategy was to use the technology to manufacture its own dairy products at a better margin. But the bottleneck was its location in a small market which meant the return on investment from this strategy would always be low. The company also didn’t know how to protect the idea, so its only option was to compete on price, pushing the returns even lower.
However, the client had ambitions to service a global market, so it needed a way to both protect the idea from copycats and to develop a more efficient method of getting scale for the technology.
The Solution
EverEdge helped the client understand its intangible assets, how to value them and the different ways it might protect and commercialise these assets. We advised the company to license the packaging technology and to phase out shipping fresh dairy products itself.
The strategy was simple. When done right, licensing can generate returns that exceed anything a single company could possibly deliver on its own. EverEdge helped to create and run a licensing campaign and on behalf of the company also approached large dairy packaging manufacturers that already owned the capacity to roll out the new technology at scale.
Results & Benefits
This licensing strategy resulted in the client shipping one billion of its new packages in the first year, earning a tidy royalty on each unit sold. The client increased its earnings by 15x in three years.
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