| Maybe you are the creative type that comes up with | | | | leave with investors that tell them: the problem that |
| great ideas, but you do not have a clue on how to run | | | | your product solves; the product's benefits and |
| a business. Alternatively, maybe you would just rather | | | | features; your market; and the legal status of your |
| think of great ideas than implement them. Either way, | | | | product (copyright info or patent pending). |
| licensing your idea is a great method to be paid for | | | | 3. Narrow Your Targets |
| your invention ideas. | | | | Now that you are ready to present your idea, you |
| Licensing is the process of selling your idea to a | | | | need to decide whom you want to present it to. Make |
| business that will take your idea and run with it - they | | | | a list of at least 50 potential targets - the more, the |
| will do all the business-related chores that are involved | | | | better. Try to research companies that might have a |
| in launching a new product. You are paid for giving | | | | need for your product, or find a company whose |
| your idea to someone who can make it happen and | | | | catalog is missing your product - you can show them |
| then you share the profits. Licensing is a good idea for | | | | right where your product would fit in. |
| those who do not have the money to launch a new | | | | You can also go to stores where you would expect |
| invention themselves. | | | | your product to be sold and write down names of |
| If you are ready to get your idea licensed, here are | | | | manufacturers who have similar products. |
| five steps to follow to ensure the licensing process | | | | Also, try checking online databases for industry |
| goes smoothly: | | | | associations. These associations can give you a |
| 1. Get Your Info Together | | | | wealth of information into the industry that will point you |
| Before you even think about going to a company to | | | | in the right direction to potential prospect companies |
| sell your idea, be sure you know the following:o Know | | | | and what these companies are looking for. |
| your market. Get as much information as possible | | | | 4. Prioritize Your Targets |
| about who would need or want your product. This | | | | Once you have compiled your list of 50 or more |
| means research: conduct a focus group or send out | | | | targets, prioritize them based on which will make the |
| email surveys to determine what age group, what local | | | | best fit with you and your product. Consider their size, |
| area and what income level would buy your product.o | | | | their product lines, their reputation and how easy it is to |
| Know the legalities. Try to determine if your invention is | | | | get to a decision maker. |
| patentable or if there is something similar to it that is | | | | 5. Go Get the Sale |
| already patented. You can search for patents on the | | | | Now you are ready to make an awesome |
| government's Web site: Also, find out if there are any | | | | presentation - you have your sell sheet, your prototype |
| regulatory issues that could be associated with your | | | | and you have used a color printing company to create |
| product (this is especially common with medical | | | | some slick, fancy brochures to leave with the |
| products).o Know your competition. Who else has a | | | | company. |
| similar product to yours? How is yours different? | | | | Once you have gotten a "yes" you are not licensed |
| Moreover, how well is the competing product selling?o | | | | just yet - you need to negotiate some terms first. You |
| Know what it takes to produce your idea. Finding out | | | | can ask for an upfront payment to cover the cost of |
| what is involved in the production process can be | | | | filing a patent, or an upfront payment that is really an |
| helpful when you are trying to sell your idea, especially | | | | advance against future royalties. Then you need to |
| if your product calls for unique materials or unusual | | | | negotiate the royalties - most inventors get a 2 |
| manufacturing techniques. | | | | percent to 5 percent royalty. If you agree upon 2 |
| 2. Get Ready to Make a Presentation | | | | percent, that means you get 2 percent of the |
| Your most effective presentation tool will be your | | | | wholesale price of each unit sold. In addition, |
| prototype. Get a sample made before you approach | | | | manufacturers will want exclusive rights to distribute |
| any potential licensors. You also need a sell sheet to | | | | the product around the world. |