Guest post by Joan Lefkowitz
Watch her interview on The Woman's Connection YouTube Vlog!
So you have an idea for an invention? What do you do now? The most successful hair accessory in history, the TopsyTail, made 100 million dollars. This did not happen by miracle or chance. The key was a well-conceived and executed plan. Following an informed approach will help you turn your invention into a bonanza of extra income.
Keep a bound ideabook of your invention idea. Date your entries. Draw it. State what it is, how it’s done and for whose use? Examine possible variations. Add and define over time.
Get it Notarized
If your idea still seems brilliant after a month or two, get it officially confirmed that you conceived your invention idea on a particular date, and have your notes notarized. This may help if you, at some point, need to prove that you were ‘first to invent’ that idea.
Seek and Search
Do your own patent search to ascertain if your invention is original and prospectively patentable. Go on the internet to uspto.gov and study all patents in the product category of your invention to see if something like yours already exists. Better yet, use a professional patent searcher who will do a thorough search and may advise the patentability of your invention. Go to an inventor’s association, books on inventing, or websites such as patentsearchinternational.com, to find resources.
Create the Initial Prototype
Use simple materials to rig it up, to see if it works. Some of the most successful consumer inventions today started as pipe cleaner, coat hanger wire or foam rubber embryos.
Educate yourself on the inventing process. Go to a bookstore or inventorhelp.com and review the plethora of books written on the subject. From Patent to Profit by Bob De Matteis is particularly informative.
The Non-Disclosure Form
This is an Agreement signed between you and anyone you reveal your invention to. It states that the information and materials belong to you and cannot be used without your written permission. It allows you to show your invention to parties who might be helpful in bringing your product to market such as prototypers, product evaluation services, manufacturers, packaging designers, licensing agents and marketers. Variations of the Non-Disclosure form are easily accessible in invention books and on the web.
Analyze Costs to Produce
Ascertain what the costs will be. Research domestic and foreign resources. Add up all costs to manufacture a unit of your product. Include molds, packaging, naming and trademarking, promotion, marketing, distribution and mark-up. Seek sources through the Thomas Register, libraries, the yellow pages, the web, Chambers of Commerce, foreign trade bureaus and referrals.
The Evaluation Process
Analyze the benefits and features, strengths and weaknesses of your invention.
Can it have longevity in the marketplace?
Is its timing aligned with market trends?
Research the size of the potential market.
Identify your competition. Question why a retailer would buy your product if they can do business with experienced, multi-product, well financed suppliers, who may take back unsold products and replace them with ongoing new items? Visit the marketplace and talk with managers and consumers. If your product represents a significant improvement or simplification in the way that something is currently done, you have a better chance of breaking through to success.
Get a Professional Prototype
Have professional prototypes made, the quality of which can be shown to potential retail buyers. For sourcing suggestions, see ‘Analyze Costs to Produce’.
Protect Your Idea
Apply for a provisional patent yourself. This can be done by downloading the application from the patent office website: uspto.gov. The provisional patent will secure patent pending status for the invention for one year during which time you must apply for a non-provisional patent, if desired, or lose the option to get the invention patented. Using a patent attorney to make the application for the provisional patent secures more complete specifications of the invention and lays the groundwork for an effective non-provisional patent application.
The Non-Provisional Patent
Your patent attorney files your non-provisional patent application. If the patent is rejected on examination by the patent office, as most are, the attorney will respond with revisions. This may reoccur several times before your patent is finally granted or rejected. This process can take up to two years. If a patent is issued it becomes your personal asset for twenty years. Like other assets, you can lease or sell it to earn income.
To Market, But How?
The inventor has the choice to license the invention to a manufacturer in exchange for a royalty percentage in sales. Typically, an inventor can expect to receive royalties of between 3 to 7 percent of net sales. The most efficient way to secure a licensing agreement is to hire a licensing agent with expertise in the field of your invention. The licensing agent is conversant in the language and varieties of licensing agreements, can advise you on options and help negotiate the agreement. Licensing agents ordinarily charge between one-third and one-half of your royalty fees. Royalties are an excellent way to create supplementary income.
Manufacturing and distributing your invention entails higher financial risk but can reap greater profits. If you have the time, financing, manufacturing connections, a storage and distribution point, bookkeeping and legal skills or assistance, sales and marketing channels and mainly the desire to be your own boss; this may be the route for you.
Teaming with specialists and hiring outside sales representatives to grow your business can create economies of scale. Successful manufacturing and distribution of a protected product can provide you with active income.