December 15, 2017
4-H Cobrand/Licensing Policy Explanation
Gregg, Wade and I have received several inquiries from 4-H volunteers and local businesses regarding the 4-H Cobrand/ licensing policy. During the past two months since implementation, there have been many inquiries across the university in order to clarify the following policy regarding a licensee that works with Kansas 4-H Programs. Please share the below information with all 4-H volunteers and small businesses in your county or district.
I requested specific K-State licensing information from Tami Breymeyer, Director of K-State Trademark Licensing, on behalf of businesses supporting KSRE/Kansas 4-H:
* $100 Annual Licensure Fee
* 12% Royalties to be paid on the shirts/apparel made
* Report and pay Royalties Quarterly
* Have every design that our 4-H club designs approved by the licensure company (within 48 hrs)
* Carry $1,000,000 in product liability Ins. (managed by insurance of company)
* Print the Wordmark KSRE on each article of clothing
The following is an explanation of these stipulations.
1) Question of Licensing
Since the 4-H Youth Development Program and the 4-H name and emblem is entrusted to Kansas State University as the state designated land grant university for the administration for statewide implementation, the name of 4-H and the state university that provides oversight to that program are intertwined. Therefore, each individual institution determines policies and procedures governing the name and emblems associated with those universities. The wordmark licensing policies and corresponding fees for use of the K-State name is not something that K-State Research and Extension or Kansas 4-H Youth Development are at liberty to separate. Kansas State University, and therefore K-State Research and Extension, is a trademarked name and therefore any use of it must be through a licensed vendor. As this co-branding/licensing process was being considered over the past year, it was identified and understood that the typical licensing fee ($1,000) would not be feasible for many small, local businesses. As a result, KSRE worked with the licensing and trademark director of the University to identify a reduced small, local business fee resulting in a 90% reduction to a $100 annual fee.
2) Royalties
Royalty percentages are a set amount and not something KSRE has control over. Anything purchased with a trademarked brand, whether it be K-State, Nike, Yeti, etc. will have a royalty percentage included in that cost. We clarified where that royalty fee goes and who at Kansas State University benefits from this fee. We received greater clarity in learning that the royalty fee is split between Kansas State University and K-State Athletics. The portion that goes back to the University is put into general university scholarship funds. We asked if there was a way to have this money come back to the 4-H program to at least know it was coming full circle to help 4-H youth. We were told that is not possible, for Kansas 4-H or any college or department on campus to receive specific monies allocated to the particular department. Those monies are distributed to students through the general university scholarship fund. K-State Research and Extension is not benefiting from this money and it does not affect our budget.
3) Reporting
The reporting structure is a business, bookkeeping aspect the licensing company has set in place to ensure that product leaving a given business matches their records. This is a Learfield Licensing company policy and not something that we can amend or change.
4) Design Approval
Designs are approved through the K-State trademark and licensing office. After speaking with the K-State licensing and trademark director, she assured the only thing she reviews is that the brand is being used correctly, per the brand guidelines, http://www.k-state.edu/vpcm/branding/KansasStateUniversity-BrandGuide.pdf (page 22 for the 4-H cobrand), and that the design is appropriate (nothing vulgar or inappropriate). The quality of the design (kid oriented, etc.) is not something she reviews. Her typical turnaround time is 24-48 hours on business days. The policy states to allow 2-4 weeks, as a cushion for her and her staff should someone be on vacation, traveling for business or school. She is a one-person team with interns.
5) Product Liability Insurance Policy
Regarding the insurance policy, this is a non-negotiable item for Learfield Licensing and not something they are willing to negotiate the amount or necessity - we asked repeatedly. We did inquire what the rates for this type of policy typically cost a business annually and were told between $300–500, but normally closer to $300 annually (but do know for certain because that this is something that can only be determined with an individual insurance provider). Vendors are free to use whatever insurance company they would like so they are able to shop/compare prices.
We understand that this is a very high product liability. When we asked why it was so large, the response was as follows: "Unintentional mistakes in a business may lead to liability claims which can be financial, psychological, or physical. The claimant may have a valid claim where they will need to be made whole and consequently pursue retribution from the university, the company of the Licensee and Learfield Licensing for damages incurred.”
We further asked what sort of claims might result in the need for this large amount when dealing with something as low-risk as t-shirts. The Learfield licensing coordinator shared that they have had instances where someone was allergic to the dye in a shirt, had an allergic reaction and sued the company.
6) Process to determine Co-Branding Policy
Our team at KSRE is working hard to ensure awareness of K-State Research and Extension and 4-H during this time of increasing pressure both through low awareness and the state budget. As we prepared for new branding changes across the K-State Research and Extension system, we conducted focus groups with local agents, specialists and faculty to gage their perception of awareness. Every agent focus group affirmed their local extension office was seen as the 4-H office in their community. Additionally, an external survey was conducted by a contracted third-party to survey Kansans on their level of awareness of K-State Research and Extension. Through that research, we learned that 46% were aware of a university system in the state of Kansas that provided research-based information and education programs. Of that 46%, 22% - nearly half – associated the system with the University of Kansas. We feel that part of this large percentage false association is because historically, 4-H has been branded simply Kansas 4-H. Many often assume Kansas 4-H is affiliated with the University of Kansas. We want Kansans to align the great work 4-H does in local communities as part of a larger Kansas State University system. That being said, even a simple task of asking community clubs and businesses to place the university cobrand on the t-shirt would not have been that simple. Because the University is licensed, it automatically means that anything with the University mark must be created through a licensed vendor. It is the same reason, as a business owner you cannot legally create something with the McDonalds arches or the Nike swoosh.
7) Impact of Policy
We agree that this policy does affect our 4-H youth, but feel overall, it has many positive benefits. Each year, we stand in front of the legislature accountable for funding priorities within K-State Research and Extension. Many of our legislators know and affirm the value of 4-H Youth Development in the lives of young people and do not want to see that support go away. Yet, there are challenges from citizens and decision makers who do not recognize that 4-H, K-State Research and Extension (KSRE), and Kansas State University are connected legally, financially and educationally.
KSRE acknowledges that this policy creates financial obligations and work for small business owners. However, we would invite small businesses to consider this as an opportunity to expand and create additional items for their business. We also acknowledge that this policy will increase the input costs for printed t-shirts for 4-H families. We have worked hard to make this process as accessible to as many entities as possible, in negotiating a reduced licensing fee and clarifying the licensing procedures.
Please continue to communicate to all 4-H volunteers and small businesses that support Kansas 4-H that we all appreciate their passion and time given in influencing young people positively through the 4-H Youth Development Program.
We hope this explanation addresses any concerns and articulates that the policy to implement the cobrand was not a decision we made lightly or hastily. The decision resulted from a deliberate and intentional process of conversation, research, and strategic decision-making in order to increase the KSRE brand recognition and positive impact through KSRE and 4-H Youth Development across the state of Kansas.
Thank you all for your support!
Megan