Brand protection is key to upholding the quality and reputation of a luxury fashion or sports brand. Regular monitoring of the licensees through compliance audits is key to this. Often the license agreements will stipulate strict guidelines on minimum pricing, sales targets, distribution channels, stock control and treatment of end-of-season sales.

The absence of regular compliance and royalty audits could lead to brand erosion and significant under-reporting of royalties through incorrect application of royalty rates, particularly when long-term license agreements stipulate differing royalty rates on escalating sales targets and unauthorised distribution channels particularly in the Far East region. We have experience in conducting royalty audits in countries such as China, Japan and Korea for European sports and fashion brand clients.