There are a lot of less than forthright organizations that allegedly help individuals sell their inventions to industry. In all of the my several years of employed as a patent lawyer, I have got never come across a single person that ever used one of these simple organizations to effectively market or sell their invention. However, I actually have met several who successfully marketed their inventions themselves.
Before you take any steps to look here, you must have a few preliminary steps.
Patent Application – Don’t publicly disclose your invention until right after a patent application is filed. Publically disclosing the invention before filing a patent application could very well ruin the chances of ever being granted a real patent. In fact, some companies will not even speak with you until you have filed a patent application.
Create a Formal Information Package – You must prepare an informative and concise information package describing you, your invention along with the potential advertise your invention reaches. The package ought to include color photographs of your invention, along with a one page executive summary.
Prototype – It is much easier to offer a product or service if prospective buyers will see, touch and experience the product. Constructing a working prototype can be a key element of selling your invention. Obviously, some items are hard to prototype, whereby a non-working mock-up might have to do. In virtually any event, make the most professional prototype or mock-up you can.
Obtain Financing – Building prototypes and filing patent applications require funds. Finding that initial start-up funding is usually difficult; however, the two main tried and tested methods, namely partnerships and incorporations. A signed partnership agreement is a sure way for a couple of customers to pool their financial resources in to a project. If several investors are involved, then an incorporated clients are a greater method. Essentially, the corporation takes ownership from the invention as well as the investors contribute money on the company to acquire shares. The amount and cost of the shares might be tailored to suit all the needs from the project.
Given that we now have dealt with several of the preliminary issues, let us consider the mechanics of selling your invention to a company. The actual steps at the same time are the following:
1. Compiling a List of Potential Buyers – Finding a company which is willing to find the invention is easily the most challenging section of the process. It begins by generating a summary of companies which may be thinking about the dig this. You can use a business directory to generate that list. Business directories list companies by the products they manufacture (or services they offer) and will include basic details about these businesses for example their address, phone and fax number, and the name of your president (CEO or owner). Suitable business directories could be located in the business part of the local reference library.
2. Contacting Possible Buyers – Your set of potential customers could include lots of companies. You simply contact each company listed and get them should they would be interested in getting a solicitation for any new invention. Then have the contact details about who in the company to transmit your data to.
3. Presenting the Invention to Prospects – After you have thinned out your list, your following step is always to submit your details to each of the companies on the list. This can involve calling the folks identified being the “contact” for brand new product ideas and letting them know you are sending them an information package about your product. Your package ought to include a cover letter and a one page synopsis of your product (including a picture). The details needs to be clear, concise and it also must appear as professional as possible. Don’t try to overwhelm the recipient – you want to impress them, not burden them.
4. Follow-up – Tend not to expect the prospect to come to a fast decision about the invention. It may take a prospect many months (also a year or higher) to produce up his/her mind on the project. You must be patient. It is very important periodically follow-up together with the company but usually do not “pester” the prospect. Remember, the individuals considering your invention are probably quite busy with several other projects – annoying them may do little to speed the project up and could make them drop the project altogether.
5. Negotiations – If you discover an organization that is certainly considering collecting the project, then be ready to negotiate the relation to the sale. The real key here is to be reasonable. From my experience, nothing kills off a possible licencing deal faster than an unreasonable inventor. Realistically, probably the most you will probably get is a good return on your investment. Looking for a lesser signing fee together with a modest royalty is way more prone to generate a signed agreement than holding out for the big payoff.
6. Royalty Amount – I am just usually asked the question “how much may i sell my response for”. I don’t understand the answer; however, here are some rules which can help you find out a 1nventhelp royalty rate. To begin with, make an effort to negotiate a royalty which is separated in to two parts, a basic signing payment as well as an annual royalty payment. The initial payment should cover your main costs of your project. The annual royalties should represent an amount which can be sufficient to represent an effective return on your own investment without being a burden around the manufacturer. The typical “guideline” is to ask for a little percentage (1% to 5%) in the net sales in the product. It is also possible, and in many cases advisable, to correct the annual royalty payment with an easily calculated amount (e.g. $1.00 per unit sold).