Chances are that if you’ve turned on your TV or radio to the news lately, you have heard quite a bit about intellectual property theft. Specifically, trade secret theft.
So, what are trade secrets? And what’s the big deal if someone takes them?
A trade secret can be any information, that is kept secret, and its secrecy provides a business advantage over competitors. As long as the information is kept secret, the owner of the information can enjoy having an edge in the market for an unlimited time. Reasonable measures must also be in place to keep this information secret.
Some of the most well-known trade secrets include: the formula for Coca Cola, KFC’s original recipe of 11 herbs and spices, and how the nooks and crannies are created in Thomas’ English muffins, to name a few.
However, big corporations are not the only ones that benefit from trade secret protection. Small businesses often have trade secrets, but don’t always realize it. Examples of business information that could be a trade secret include:
- Client lists
- Planning documents
- Mathematical formulas
Often times, items like these are the foundation businesses are built on. Imagine running your company without the list of clients you developed over the last ten years, or running your bakery if someone stole the recipe book containing the ingredients for award winning cookies. The loss of this valuable information can potentially result in financial ruin for a small company.
The most important thing a small business owner can do is identify any trade secrets and then take steps to prevent them from being exposed to the public. Different employment agreements can be used to protect proprietary information, such as confidentiality agreements, non-disclosure agreements, or non-competition agreements. Other ways to protect the secrecy of trade secrets can include limiting the number of employees who have access to the information, securing browsers and databases with password protections, using security badges to access information, and installing doors or fences to prevent the general public from accessing proprietary information.