You’ve invented something patentable but aren’t sure what you should do with it. What are the possible opportunities to make money? This article will provide specifics on how to get your idea to market which includes manufacturing and IP licensing.
The first step is to examine your invention in depth and become familiar with the fields it could use in. Research on market research is crucial!
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Google is a great resource for this. It is possible to search for the most successful companies and emerging competitors in your market and then review their offerings and services. References and sources could include business magazines, online journals, magazines, and blogs. Keep in mind technologies that are likely to be in demand in the future and are likely to appeal to your target markets. This is because you come across a product that is infringing your invention, and you are able to make an IP infringement case against the manufacturer. Your technology could be utilized to enhance the capabilities of an already existing product. This could result in IP licensing opportunities.
If you wish to be successful, you need to think about the needs of your clients. Pay attention to the opinions of customers on social mediaplatforms, companies’ websites, ecommerce sites blogs, and other online platforms. Help customers solve their issues in relation to current products by analyzing their feedback. It is possible to build your brand and build your own fan base by doing this. You can also inform customers about future products and business plans.
Let’s take an illustration. An electronic device is sold by a business. It’s got an issue with the heat-up process early. It is fortunate that you have developed a special chip, which can solve this problem. It is possible to search the web for opinions about the issue and then tell your customers that you have a solution. It is possible to build trust with an audience of customers, thus, it becomes easier for you to sell your products.
If you do thorough market research, you win half of the game. The next stage is studying market analysis reports as well as an exclusive developing an IP strategy to monetize your invention. Two options are offered:
Patent licensing is the same as renting a house to tenants. You retain ownership of your IP rights, however you let others make and sell products for a certain period. The licensing agreement can be signed between inventors or companies; the IP owner is referred to as licensor, and the party that gets the right to make use of and sell the patent technology is called licensee.
As an IP owner, you have the right to set terms and conditions in the license agreement. You could be required pay a percentage of the royalty or a fixed sum for future sales.
However, it is hard to determine the total amount you can earn as an inventor license your patent to others. All depends on the value of the patent. It is affected by many aspects. These include:
- Total market size and the rate of growth
- Number of customers that are not in the patent’s life
- Customers make purchases
- Costs of product development and taxes
- Manufacturers earn an annual profit
There are two options for IP licensing – exclusive or non-exclusive. With exclusive licensing, only one licensee is granted exclusive rights to develop and sell an invention (usually exclusive license agreements are signed with startups that help them expand into the market). On the other hand non-exclusive licensing permits multiple licensees to practice the patent-pending technology simultaneously making use of the IP to the fullest extent.
Producing on your own
Usually, the royalties that inventors earn through IP licensing can range from 2% to 10% of the total revenues. If you’re thinking “why should I get a small slice from the pie when I deserve the whole part”, you should go to manufacturing and selling your products for yourself.
Ron Westrum and Ed Zimmer found that more than half of inventors created their own products and were able to market the products successfully.
To be a successful businessperson is to know about the business world. Furthermore, you need to have these personality characteristics:
- Salesperson Every entrepreneur has one goal in common: selling their products to the maximum amount of people. Thus, you should have qualities of a salesperson, informing people about your product and convincing them to enter in the list of your paying customers too.
- Take a risk:Sometimes you will need to break out of the crease in order to score six on the final ball. This is how to win the game. Although, there is the possibility of a run-out but you’re left with no options. To become an entrepreneur it is essential to take chances. While you may be facing bankruptcy or other financial problems, there are a good chances that you will return to try again.
- Innovator:Innovation is among the key tools of growing your business, and you should be expert in this. Offering people something fresh or enhancing services and products with the latest technologies help to attract new customers as well as keeping the existing ones.
- Manager: You should have managerial skills and be able to lead a team. Understanding that employees are the heart of any business is vital, and could aid in increasing sales only if they are motivated and focused.
There are two options to get an invention on the market: patent licensing or manufacturing. It’s hard to choose which is better. Each has advantages and disadvantages. It is up to you to choose which suits your needs best.
So, your aim should be crystal-clear. It is up to you whether you wish to establish your own business , or receive royalties by allowing someone to use your IP rights.
But, the return on investment are higher if you opt for manufacturing, but you’ll need thousands of dollars to start a business. If you’re not able to afford the financial resources, IP licensing is the right way for you to take.
Manufacturing or licensing, what do you think is best option for IP commercialization?
Scintillation Research and Analytics is a leading IP services firm based in Mohali, PB, and it specializes in intellectual property search, IP licensing, prosecution, and market research.
What differentiates Scintillation’s patent documents from other IP companies is the detailed market analysis, including trends in the market and competitor analysis, as well as customer demand analysis, etc. Clients will gain a deeper understanding of their customers’ needs and target markets and can create unique IP strategies.