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Ask the Expert: 'You have an idea for a product. Now what?'
Joe Schappler. It is exciting! You say, "I can't believe nobody has done this yet." But an idea, in and of itself, does not have much value unless you can do something with it, such as developing the idea into a product that can be commercialized. A common misconception among inventors is that a raw idea or even a product concept is highly valuable.
Getting a product into the marketplace can be a roller-coaster ride, both rewarding and daunting. There are economic, development, time- and market-research related challenges to overcome to be successful.
Recent data show that only 5 percent to 7 percent of patented ideas are commercialized.
The steps to success in bringing a product to the marketplace include research, industrial design ideation and refinement, prototyping, production design and documentation, marketing and distribution. That's a lot to undertake even for the simplest products.
Before beginning this commercialization process, understand what you, the inventor, wants to get from the effort. There are many ways to commercialize a product. The most common ones are to manufacture and sell directly yourself, license and collect royalties, sell your product idea or develop the idea along with a strategic partner.
Let's look at each approach independently:
Start by doing a simple patent search (www.uspto.gov) to see what patents may already exist. This is not as good as retaining a patent attorney, but it is a simple, no-cost first step. If it's a consumer product, go visit your local big-box retailers and see if the idea is already out there in some form or another.
Otherwise, get on the Internet and see what you can find. Find competitive products and do as much research as possible to understand what you're up against.
If your idea merits moving forward, you may consider identifying and retaining the services of professionals to assist in your efforts. These might include a patent attorney to protect your idea and conduct a more thorough patent search, as well as other legal considerations.
Strategic marketing professionals can help you identify how to promote and get your product into distribution, if you elect to go that route yourself.
A design firm can assist in developing a product for commercialization, prototyping and manufacturing. And don't forget your friends and family as valuable no-cost focus group attendees!
There are many aspects to consider when commercializing an idea and many ways to move forward. It can be an unforgettable and gratifying adventure but proper planning is necessary to keep your risks in check.
I am pleased to participate in the "Ask-the-Expert" series and look forward to answering your questions about this article, or about product development in general.
Source:http://www.unionleader.com/article/20120402/NEWS0201/120329744
About the Author: Joe Schappler is a successful entrepreneur with numerous patents and a proven track record in product development and business management. He owns Helix Design Inc., a small product design business in Manchester.
Getting a product into the marketplace can be a roller-coaster ride, both rewarding and daunting. There are economic, development, time- and market-research related challenges to overcome to be successful.
Recent data show that only 5 percent to 7 percent of patented ideas are commercialized.
The steps to success in bringing a product to the marketplace include research, industrial design ideation and refinement, prototyping, production design and documentation, marketing and distribution. That's a lot to undertake even for the simplest products.
Before beginning this commercialization process, understand what you, the inventor, wants to get from the effort. There are many ways to commercialize a product. The most common ones are to manufacture and sell directly yourself, license and collect royalties, sell your product idea or develop the idea along with a strategic partner.
Let's look at each approach independently:
- To manufacture and sell a product yourself, you will have to become familiar with all the aspects of development and be capitalized to fund the effort. Depending on the complexity of your design and the market you are after, this approach can be obtainable today through means that did not previously exist.
- Shopping on the Internet has become very popular and may be an appropriate path to commercialize your product. Just remember the product must be easy to find using a search engine, so something very unique or buried in a niche may be hard for customers to find.
- There is less financial risk, and far less time involved, if you are able to identify a company interested in your product and enter into a licensing or royalty agreement. Because the selling company will have to invest large sums of money to bring your product idea to market, you should expect a 2 percent to 10 percent royalty of net revenues with 5 percent usually considered reasonable.
- There are some excellent companies that have established contacts throughout several markets and can assist you with this effort.
- I have seen little success in selling an idea directly to a specific company. You will need to do considerable homework in identifying possible companies, understanding their product lines, and demonstrating how your product idea complements their business.
- How to value your idea is difficult, and you can easily short-change yourself. To make this work you will really need to do your research about your prospect companies, and have your product idea well developed and protected.
- Certain niche products that are complex and may require considerable investment and time to develop may benefit from a strategic partnership. A partner company may have the development resources that you do not have - and the appropriate budget - to develop the product. To make this work you will need to be able to demonstrate how your idea meets a need for the company and is profitable for them.
- Apart from how to get a product into the market, I am often asked how far does an inventor need to take the product design? Unfortunately there is not a single answer other than an idea, in and of itself, has no value. So where do you begin?
Start by doing a simple patent search (www.uspto.gov) to see what patents may already exist. This is not as good as retaining a patent attorney, but it is a simple, no-cost first step. If it's a consumer product, go visit your local big-box retailers and see if the idea is already out there in some form or another.
Otherwise, get on the Internet and see what you can find. Find competitive products and do as much research as possible to understand what you're up against.
If your idea merits moving forward, you may consider identifying and retaining the services of professionals to assist in your efforts. These might include a patent attorney to protect your idea and conduct a more thorough patent search, as well as other legal considerations.
Strategic marketing professionals can help you identify how to promote and get your product into distribution, if you elect to go that route yourself.
A design firm can assist in developing a product for commercialization, prototyping and manufacturing. And don't forget your friends and family as valuable no-cost focus group attendees!
There are many aspects to consider when commercializing an idea and many ways to move forward. It can be an unforgettable and gratifying adventure but proper planning is necessary to keep your risks in check.
I am pleased to participate in the "Ask-the-Expert" series and look forward to answering your questions about this article, or about product development in general.
Source:http://www.unionleader.com/article/20120402/NEWS0201/120329744
About the Author: Joe Schappler is a successful entrepreneur with numerous patents and a proven track record in product development and business management. He owns Helix Design Inc., a small product design business in Manchester.