After you've done your market research and determined the originality of your idea, you'll want to prototype it. The most obvious reason for creating a prototype is to have something to present and demonstrate to potential licensees and buyers. Gibbs notes these prototype purposes as well: 1) to prove the design or size of your invention; 2) idea "reduction to practice," which will complement your journal; and 3) to discover more patentable details of your invention before you file your application.
If you can get a prototype made in a way that creates a "looks-like-works-like" version of your product in a small quantity, that's even better. "There are two huge advantages to having multiple 'product quality' prototypes: You can have multiple people looking at them and not worry much if one gets broken or doesn't come back, and you can put some on the market for sale for real and see what actually happens when buyers have the opportunity to purchase," says White, adding that the provisional application for patent should be filed before this test marketing. "So what if selling prototypes loses money at retail prices? Actual proof that the product will sell before spending large amounts on production tooling substantially reduces the risks of such a costly decision."
When you're looking for a prototyper, you'll go about it in much the same way as looking for a manufacturer: lots of networking with similar professionals, looking on PatentCafe.com or in Inventor's Digest ads, or searching under headings like "designers, industrial" and "engineer, product development" in the Yellow Pages.
Before you contact them, you'll want to have a solid idea of what you need. "I prototyped for several years, and people would come to me with lunch-bag and napkin sketches or, even worse, just a verbal idea," says Lander. "Get a draftsperson to make drawings. They don't have to be real fancy, but they should have all the dimensions. It's a lot cheaper to erase a number on paper than it is to try to repair something that's already in metal or plastic."
Q: QVC & HSN
QVC and HSN are two coveted outlets for inventors. HSN alone featured 25,000 new products in 2001, and QVC hosts a National Product Search (the last one was held April 26-28 at the Mall of America). Visit their Web sites and search for vendor information for further details.
This is what you get--usually a percentage of their sales (not retail)--from your licensees. That's a simple definition for a very important figure that could make or break your invention. First, a piece of advice: Understand your industry norms for royalty fees, because if you blanche at the figure they offer you without understanding the reasoning behind it, you may appear not only greedy, but uninformed and unprofessional as well.
Second, figure the manufacturing costs before you ever start the patent process. (See X for more details.) If it's so much that neither you nor your manufacturer will turn a decent profit or so much that you'll be overpriced compared to your competition, you'll need to either reassess your manufacturing process to try to cut costs or just go back to the drawing board.
Once you know how much your product will cost to make, use this handy formula (courtesy of Gibbs) to figure prices: Multiply the production costs by 4.5 for products sold through retailers. For commercial products, multiply it by 3.5. If this price is competitive, start looking for licensees. The more profitable your invention, the more leverage you have in royalty negotiations. (For a more detailed explanation, read this article on PatentCafe.com.)
And finally, note this piece of advice: "An inventor must always be careful to get some kind of guarantee for a minimum [royalty] so the licensee can't simply tie up the invention and never do anything with it," says Lander. "There has to be an incentive for them to actually do something with it. Or if they want to leave it on the back burner, they at least have to pay the inventor a minimum annual figure."
S: Sales Outlets
You're a brand-new inventor and you want to become a Wal-Mart vendor? Good luck, because you've got a rough path ahead of you. Mass retailers are often loathe to add one-line companies to their vendor roster because it costs them more money to do business with you and you have yet to prove yourself a reliable supplier. It can happen, but you have a much better chance at building your brand by focusing on smaller, local retailers and catalogs. (Try Google's catalog search here.) http://catalogs.google.com/
A warning: "Catalogs usually have the advantage of not initially requiring retail-quality packaging, but there is often a substantial delay in getting into their publication cycle," says White. "Independent local stores will often be delighted to take on a local's product--on consignment, meaning they pay you only after the product sells. If the product starts getting repeat orders and other stores start asking for it, then it's almost certain that the big box stores will eventually come knocking."
T: Trade Shows
For new inventors, attending a trade show will be a lot more beneficial than trying to be a vendor at one. "Industry shows are essential," says Hayes-Rines. "As an attendee, you can pick up business cards of sales managers. As a vendor, it's tough. These shows are usually high-priced, and you must have product. Invention shows offer lots of opportunities--some market testing, learning from others [through networking], and learning how to present yourself at a trade show. It's not as easy as it looks."