you an inventor who has an idea but know nothing about business? Or you both an inventor and a businessman that would rather spend most of his time as an inventor? If you, are, then I have good news for you. There is an option that fully suits your needs perfectly: licensing your invention idea.
Licensing is simply the process of selling your idea to another company that will fully develop the business side of the industry. They will take on all the business related tasks that are needed in launching the new product. This is also a great option for those whose financial resources are very limited.
But how do you license your product to other companies? Just as there are steps into starting your own business, there is also a smart way of licensing your invention. Here are the steps in licensing your invention:
For any venture, gathering ideas is a very important step. It builds foundation. Know your market by gathering as much feedback as possible on your own idea. Test your ideas among friends and family. Locate and do the necessary legal legwork, determine if your idea is patentable. Then look into production, especially if your idea calls for unique materials or processing techniques.
After gathering all the relevant information regarding your idea, create a three dimensional prototype model of your invention, a simple sell sheet to convey all the information you have gathered, and a professional slide presentation to present in front of your potential licensors.
Determine the most appropriate contacts for your new business opportunity. Create a list of at least 50 prospects as a first step. It is a numbers game, and it’s understandable that most companies will turn you down one way or another.
Create a priority list among the 50 prospects you have listed. You will prioritize them based on which will make a best fit for you and your products. Consider these factors when qualifying prospective licensees:
Now that you are armed with valid information, professional presentation materials and a hot prospect list, it’s time to bring your idea to your prospects. Understand that there are no set of rules or terms when it comes to negotiating a licensing agreement. The perfect agreement is one that gives both you and the manufacturer exactly what you want. It will be tedious, it will be hard, but it will be worth it.
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