Independent licensing agents are finding it increasing tough to increase margins and revenue. Research is showing that consumers are spending on essential items and non-essential sectors such as gifts are being affected. As this pattern of demand persists, retailers are choosing to list key tried and tested licenses which are safe, and their impact can be relatively accurately predicted. Their demands for increased margins, tougher payment terms and smaller orders means that agents are getting fewer and lower advances and minimum guarantees are often not being met. The increasing cost of certain raw materials such as cotton are also affecting the bedding and clothing sectors making it harder for licensees to maintain profitability. Direct to Retail contracts are on the rise. We have seen this before and we believe this is part of a cyclical period. It is not all doom and gloom and we would love to hear some positive stories..