So, you have a patented invention, but you don’t know what to do next? What are the possible money-making options available for you? This article will provide detailed information about how to make your invention available to the marketplace, manufacturing on your own as well as IP licensing.
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In the beginning, you must study your invention thoroughly and be familiar with the marketplaces it could be used in. Make sure you conduct market research!
Google is a great source for this. Find the most reputable companies and emerging players operating in the markets that are targeted by your idea, and then study the current offerings of their companies. References and sources could include business magazines, online journals magazines, blogs, and newspapers. Additionally, you should be aware of the technologies that are trending and will be hitting your market in the future. You may come across products that infringe your technology and can be able to file an IP infringement lawsuit against the manufacturer. Your technology may be used to enhance the performance of a previously-existing product. This could result in IP licensing opportunities.
It is essential to consider the customer’s perspective in order to be successful. Take note of the comments and suggestions from the opinions of customers on social media, ecommerce sites, company websites blogs, and other platforms online. Find out what issues that customers have with current products and help them in finding solutions. You can build your brand and build your own fan base through doing this. You can also inform customers about upcoming product launches or business plans.
Let’s look at an example. A company sells an electronic device that has an early heat-up problem. It is fortunate that you have developed a special chip, which can fix this issue. What you have to do is to search for online reviews of customers who have written about the problem and tell them that you’ve come up with the solution. It is possible to build trust with a group of customers which becomes easier for you to promote your products.
Market research is just half the fight. The next step is to study reports on market analysis and an individual developing an IP monetization strategy for your invention. There can be two options:
Patent licensing is similar as renting a home to tenants. You are the owner of your IP rights, but let others use them to create and sell products for a certain time. The licensing agreement could be signed by corporations or individuals. The IP holder is known as the licensor, and the licensee is the one who has the right to make use of the technology that is patent-pending to sell or manufacture and/or use of the same.
You, as the IP owner are entitled to set the terms and conditions of the license agreement. The terms could comprise an amount fixed for future sales or a part of the royalties per unit.
It is difficult to determine the amount you could earn as an inventor license your patent to other people. It all depends on the value of the patent. This is influenced by many variables. These include:
- The market’s size in its entirety and its growth rate
- The number of customers who are not in the patent’s life
- Purchases made by customers
- Taxes and development costs for products
- Manufacturers make an annual profit
There are two types of IP licensing: exclusive and non-exclusive. With exclusive licensing, only one licensee got exclusive rights to develop and market the invention (usually, exclusive license agreement are done with start-ups, helping them grow in the market). Non-exclusive licensing, on other hand, grants several licensees access to patent-pending technology at the at the same time. This allows IP to be used to its maximum potential.
Manufacturing on your own
The royalties an inventors earn through IP licensing range between 2% and 10 percent of the revenue. It is recommended to consider making your own products, and then selling them.
Ron Westrum and Ed Zimmer found that they had more than half of inventors created their own products were able market their products successfully.
You must be well-versed in the world of business to be an effective businessperson. These personality traits are also essential.
- Salesperson Every entrepreneur shares a common goal: to sell their products to the maximum amount of people. So, you need to have characteristics of a salesperson telling people about your products and convincing them to be included on your list of paying customers as well.
- Be prepared to take a risk:You may have to be able to get out of the crease in order to score six on the last ball. This is the way to take the lead in the game. There’s always the chance of running out however that’s not an alternative. Similarly, to grow as an effective business person, you must be willing to risk it all. There is a chance that you will be in the position of having to file for bankruptcy or down credits but at the same time are likely to come back to play another game.
- Innovator:Innovation is among the most important tools for growing your business, and you need to be skilled in that. Offering people something fresh and upgrading products and services with the modern technology helps attract new customers as well as keeping the existing ones.
- Manager: You should have the ability to manage and to manage an entire team. It is important to grasp the fact that employees are core elements of a company; and they are able to assist in increasing sales if they are focused and motivated.
There are two options to get an invention on the market either through patent licensing or manufacturing. It is hard to decide which one is more suitable. Each has its own advantages and disadvantages. It is up to you which one suits your needs best.
The goal you are aiming for should be crystal-clear. You could start your own company, or let someone else use your IP rights.
The returns on investment are higher if you choose manufacturing. But, it requires thousands of dollars to establish a company. If you don’t have enough financial resources, IP licensing is the most appropriate way 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.
Scintillation’s patent reports differ from other IP companies because they include extensive market information, including trends in the market competitive analysis, customer need analysis. Therefore, clients have a greater understanding of their target market and the needs of their customers and, as a result, develop exclusive IP strategies.