Case Studies - Learning from local companies

Making Money On A Name

Ya Kun International Pte Ltd

Franchising usually involves a combination of a know-how licence and trade mark licence. In a typical franchising arrangement, the franchisee shares the risk of expanding the market share of the franchisor by committing capital and resources to the development of a new location or market modelled after the proprietary business format of the franchisor (know-how licence). Included in the franchising agreement is the use of the brand name of the franchisor by the franchisee (trade mark licence).

Franchising is prevalent in the food & beverage industry. Although Ya Kun Kaya Toast began as a coffee stall in the early 1940s, it started its franchising business in 2000 and has to-date sprouted 15 outlets in Singapore. Within 4 years, its franchising business accounted for half of its business and about 20% of its net profit before tax.

Commercialisation of IP began with creating IP and recognising the need to protect IP within the business. Ya Kun had identified its need for professional / legal advisors at the initial stage of its business development. When Ya Kun started in its franchising business, trade mark registration was sought for their business name. Said Mr Adrin Loi, Executive Chairman of Ya Kun International Pte Ltd, “Besides our trademark registered on the logo and business name Ya Kun Kaya Toast, it is essential that the intellectual property created in the course of our business for our business be protected.

"Moving ahead with our globalising effort in strategic approach for market penetration, we recognise the need to protect our trade mark in countries such as Japan, Korea, Indonesia, Malaysia and Australia. This is spurred by our adverse experience both locally and in other countries, where we encountered attempts to use our business concepts without seeking consent or passing their business off as ours.”

"Besides trade marks, there are other forms of IP rights residing within the business such as copyright. Said Mr Loi, “The scriptwriting in the history, poems, commentary and profile on how Ya Kun came about are framed-up works displayed primarily at our Far East Square outlet, and we are aware of our rights to the copyright in these works as well.”

The much coveted recipe for the Kaya that gives life to Ya Kun’s toasts, constitutes another device that is key to an IP strategy for business, i.e. trade secrets. It is the undisclosed information that has business value and remains unbeknown to all but Mr Loi and his household – something they are tight-lipped about in the course of business or everyday dealings.

A combination of all these IP assets are what makes Ya Kun’s kaya and kaya toasts uniquely theirs.