What Is A Trade Secret?

A trade secret is a particular company’s process or practice that’s generally unknown to people outside the company. A trade secret is believed to offer the company a competitive advantage over its competitors and is primarily a result of comprehensive internal research and development.

To be legally regarded as a trade secret in the US, a company needs to invest efforts to conceal the information from the general public. The trade secret needs to contain information and should have an intrinsic economic value. Trade secrets are an organization or firm’s intellectual property.

What Are Trade Secret Examples?

Some commonly known examples of trade secrets include:

• KFC’s secret blend of herbs and spices.
• Google’s search algorithm.
• McDonald’s Big Mac “special sauce.”

How to Protect Your Company's Trade Secret?

Here are some ways in which you can safeguard your company’s trade secret:

• Implement business procedures to augment non-disclosure agreements.
• Establish stringent electronic and physical security and confidentiality measures.
• Identify, evaluate, and take necessary steps to manage, or eliminate risks.
• Establish due diligence and ongoing third-party management processes
• Set up an information protection team.
• Monitor and measure corporate security and information protection efforts.
• Take corrective actions and continuously improve procedures and policies.
• Prioritize trade secret protection.