Licensing fees can be structured in various ways, depending on the agreement between the licensor and the licensee. Common structures include:
- Upfront Fees: A one-time payment made at the beginning of the licensing agreement. - Royalty Payments: Ongoing payments based on a percentage of sales or profits generated from the licensed property. - Minimum Guarantees: A minimum amount that the licensee agrees to pay regardless of sales performance. - Milestone Payments: Payments made when certain predefined milestones are achieved.