Brands by Value preview

24 May, 2013

Calculate royalty rate – the brand strength score is applied to the royalty rate range to arrive at a royalty rate. For example, if the royalty rate range in a brand’s sector is 1%-5% and a brand has a brand strength score of 80 out of 100, an appropriate royalty rate for the use of this brand in the given sector will be approx 4% 

Determine brand-specific forecast revenues using a function of case sales, average prices and equity analyst forecasts to determine the proportion of a parent company’s revenues attributable to a specific brand

Apply the royalty rate to the forecast revenues to derive brand revenues

Brand revenues are discounted post tax to a net present value which equals the brand value

Brand ratings

These are derived from the Brand Strength Index which benchmarks the strength, risk and future potential of a brand relative to its competitors on a scale ranging from D to AAA. It is conceptually similar to a credit rating

AAA – extremely strong, AA – very strong, A – strong, BBB-B – average, CCC-C – weak, DDD-D – failing

Analysis by Brand Finance (brandfinance.com). Other commentary contributions from Ed Will of Breakfast (breakfastagency.com).





Comment

Dominic Roskrow

It’s ‘up periscope’ for Irish distilleries

I know how wierd this might seem but I often think that the opening of a new distillery is like the launch of a new submarine. It is unveiled in all its pristine glory in a blaze of publicity and fanfare.

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