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What’s The Cost If You Don’t Trademark Your Brand’s Name?

What’s the cost if you don’t trademark your brand’s name? If you’re starting up a business, this has likely crossed your mind as you’ve juggled the many foundational elements involved in starting strong. Getting your brand out into the world requires a certain amount of elbow grease and calculated finesse—every task involved will get prioritized according to your mindset. 

Unfortunately, the legal elements of your brand’s foundation will often receive a lower priority because they can be costly and it’s truly not as enjoyable as investing in an eye-catching website. But how much does it cost if you don’t trademark your brand’s name right away? 

We wouldn’t blame you for wondering, many new business owners often try to weigh the cost of delay as they grapple with that ever-growing to-do list. Aside from the limitation of time, there’s often a question that pops up in a moment if our confidence is shaken by the ups and downs of entrepreneurship. Is trademarking worth investing in from the start if you can’t have 100% clarity in your business growing and succeeding? This is really a slippery argument we can often make in our own heads—it’s easy to convince ourselves of a perceived “safe route”. 

This might mean we convince ourselves that we should simply get the front-facing aspects of our business polished so we can attract clients and customers. Once that happens, then it’s time to focus on our contracts and trademarks because we’ll have a profitable business to pay for these legal investments. On the surface, it feels like this idea aligns with a frugal, risk-averse approach that can be valuable when starting a business. But when you really put some thought in and dig deeper, it’s actually quite expensive not to trademark right away. Ultimately, the mindset of the “safe route” can end up costing you quite a bit of money and leaving your business vulnerable. 

Before we dive into how much it costs if you don’t trademark your brand’s name, let’s look at the risk-averse, frugal inclination you’re feeling starting a business. This is actually a great instinct and if you listen to it, this drive will save you from purchases and decisions that really won’t benefit your business in the long run. Part of being an entrepreneur means that you need to know when to invest in your business because it will benefit you—a solid legal framework is definitely one of those areas. If you wait until you are successful to secure your trademarks and contracts, you’ll end up with your brand’s reputation and future in a vulnerable place. (More on exactly what this means later!) At first, it might seem that we’re advocating you become less frugal and risk-averse but actually, we advocate in keeping that mindset! To us, the solution lies not in changing your mindset but in resetting your expectations of what is essential in a solid business foundation. Once you understand that trademarking and solid contracts are what your new business needs, it’s only natural to feel proud of maintaining your frugal mindset and have peace in your investment.

Now, let’s move forward. What’s the cost if you don’t trademark your brand’s name? Knowing where the risk and expense come from will allow you to make a truly educated decision on what’s essential for your business. 

If your brand’s name isn’t trademarked and you begin to experience success, you’ll likely experience press and an amplified social media presence. While this is excellent for your brand’s reputation, it exposes you to a costly rebranding process if your brand’s name isn’t trademarked. 

Trademarking essentially states that you own this brand name you’re using and have the right to market with it. (If you want a more detailed explanation, we broke it down here!) If another more established brand with a trademarked, similar/identical name notices you, they have every right to demand you rebrand and rename your business so their customers or clients don’t get confused. Even if you didn’t know they existed, this brand will likely feel that you are copying them and acting accordingly. At this point, you’ve spent a lot of time and energy selecting your brand’s name and creating a recognizable brand—investing in professional design services and putting in countless hours of creative brainstorming. That’s a huge cost to front again, to ease ourselves into sticker shock, let’s say rebranding is $5,000. (That’s a low estimate but it works for this example!.) 

Next, let’s say this more established, already trademarked brand engages you in a lawsuit alongside demanding you rebrand. They feel you’ve misled their customer base and want to be compensated for it. Not only do you have to engage an attorney to defend you, but the court may also stipulate you have to pay your opposition’s legal fees because you’ve inconvenienced them. You’ll likely end up paying at least $15,000 in court and legal fees alone, outside of what the court may order you to pay the brand suing you.

Finally, and we think this is the most important part, calculate your time spent on all this. Most entrepreneurs who end up dealing with a lawsuit and rebranding will spend around 160 hours of their time. Let’s say you charge $50/hr for your services. (Again, we’re thinking small, we bet you make more!) You will lose approximately $8,000 not working those 160 hours.

On the low end of the costs that would likely result from not trademarking your brand’s name, you would be faced with paying $28,000. Now, allow your risk-averse, frugal mindset to sit with these potential costs and the mental burden you would face. It really shifts your perspective to see the argument for why trademarking your brand’s name from the start is essential, doesn’t it? This breakdown really answers the cost if you don’t trademark your brand’s name and it’s not the price any entrepreneur wants to pay. 

If you’re curious about how many trademarks you need, read through our breakdown here. And if you’d like to inquire with us about trademarking your brand’s name, book a complimentary consult here.

This post is for general education and does not initiate an attorney-client relationship with us. We always recommend consulting a trademark attorney for your brand’s specific needs.

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