Bright Ideas

Selling Points

When you begin negotiations with a potential buyer or licensee, keep the following six points in mind:

The ultimate price you agree on will be the result of your negotiation.

The licensee or buyer will want to limit your idea's selling price to an amount less than the extra profit he or she will make.

You want the profit to be no less than the amount you lose by foregoing other opportunities, such as selling the idea yourself.

Don't give away more than you need to get a signed licensing agreement.

Contracts are an art, not a science. If they were standard, there would be no need for attorneys.

There is no exact method of calculating a price. Every deal is unique.

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This article was originally published in the July 1997 print edition of Entrepreneur with the headline: Bright Ideas.

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