There are really only two ways of developing a new idea.
Option One would be the ‘do it yourself’ method. First you would find a manufacturer and contract them to produce several thousand units. Then, you would package them and go out and promote them to buyers at retailers and probably try to sell some on the internet. This is the most costly and time consuming route, since all of the: marketing, warehousing, packaging, shipping and distribution logistics fall on the inventor. Some inventors have found that quitting their day job was the only way to properly accomplish this.
Option Two is licensing. Licensing is the process where an inventor sells or rents the right to his/her idea to a larger company. Most commonly, the inventor receives a ‘per unit’ royalty and/or upfront fees for his/her idea. This option tends to be a simpler and less costly approach to new product development. Probably 95% of inventors will simply license their idea.
The process of licensing can be broken down into 3 steps known as:
Apply for patent protection (gain patent pending status) and possibly trademark protection.
Develop a compelling visual presentation that will demonstrate the exciting features and benefits of the invention.
|a.||Prepare a database of at least 20 potential licensees.|
|b.||Companies should be large and medium sized and consist of a cross section of manufacturers and distributors.|
|c.||Contact the companies by phone and promote the opportunity.|
|d.||Negotiate a royalty/license contract.|
Inventor does not file soon enough and loses rights to Patent.
Inventor infringes on someone else’s Patent.
No clear strategy after Patenting.
Innovative Licensing & Promotion Offices: