Pointing me in the direction for a new product idea

[lsimpson33]

Hi all,

I have an idea for a new product that has a similar model to the "seasonal garden flags" that you see people putting in their front yards where you have one base and then different items for each season. I've confirmed that the idea is unique.

I'm pretty clear on the patent process, but don't really know the other steps, such as testing the market potential of something like this, various business models (I'm not interested in manufacturing it myself), and other steps I need to take.

Can anyone point me in the right direction?

 

[street]

I can't help you out but there is a Non Profit called SCORE. There are members here that volunteer their talents for people like you. I got in touch with SCORE at one time and the professional helped me out and got me going in the right direction.

I hope some of them here pop in and can give you some great info. I will say if you search SCORE as an agent to help starting out people with invention business etc. you will find their site.

 

[savory]

I think Score is a good idea.

I might start with market size units and dollars. Based upon what you can learn from the current market,

In one sentence, what makes your product unique?
Have you developed a prototype?
Have you demonstrated your prototype, at least to friends and family as a concept and ultimately as a working product which might require more than one prototype?
Investigated costing to manufacture? Do you think you can make/sell at a market price?
how many units, at what price do you think you can sell? With that in mind, what do you think the length of time for payback will be? Market research, tooling, advertising, promotion, etc costs will be that will need to be recovered by the selling price?
How easy would it be for a company to get around your patent?
If you were to sell the patent, do you have a target list of customers and have you done research about why they would add it to their portfolio?.

Launching a consumer product is not easy. It isn't easy for the people who work in large consumer product companies with all the knowledge and resources. And, it is costly. You will need to have something very convincing and worthwhile. I would feel good about it before going through the patent process by getting as much honest feedback as possible and doing your best to learn the entire market you will be launching into.

Good luck, I hope you are successful.

 

[SecondCor521]

A simple way to go in your scenario is:

A. Get the patent.
B. Find out who sells products similar to yours.
C. Procure a licensing deal with them. They do everything and pay you a percentage of the sales.

You probably want a patent attorney helping you with the patent. Even if you know quite a lot, patent law is really complicated and having the patent written as well as it can be is both rather tricky and pretty important.

The cost of a patent can easily be $10K on up.

You'd probably want someone helping you negotiate the licensing deal, too. I don't know what those people charge, but if your idea is good, an extra point or two on the deal could be lots of money.

 

[OldShooter]

I was a SCORE mentor for 6+ years. The first thing to do is to talk to people about your idea. The general script is "I am thinking about starting a business to sell <product name here>, and I am looking for advice." and at the end "Do you know anyone who might also be able to give me advice on this?" Start with professionals in your network like lawyers, CPAs, insurance agents and follow every lead. Also contact people (clerks, buyers, owners) at places that sell similar products. Even contact people who manufacture similar products, maybe in other cities so you're not viewed as a direct competitor. Shoot for successfully contacting at least 50 people, taking detailed notes of every contact and making follow-up calls as necessary. Listen especially carefully to people who tell you things you don't want to hear.

Forget about family and friends. They will just pat you on the head and say you have a great idea. Whether you do or not.

You are probably going to end up with a design patent, not what I call a "real patent." Patents cost a ton of money, take a long time and by themselves provide little or no protection. Your protection comes from the patent and the $20K retainer you have just paid the attorney to file the suit. If your infringer is a little guy, you may have a chance, but your cost to win might be more than the amount he has damaged you. If your infringer is a Fortune 500 company you are dead meat. Unless your idea is really special I would not wait for, maybe skip entirely, the patent idea and get to market faster.

Licensing is a dream until you have a track record of market success and then the most likely outcome is that your potential licensee will steal the idea, tweeking it just enough to make a patent lawsuit not worth the $$.

Your best move is to modify your dreams based on those 50 people's advice and go to market as first mover, using a contract manufacturer if necessary. In the unlikely but possible case that you hit the ball out of the park, the opportunities will come to you.

@davidf's comments are good, but getting out of your internally-focused thinking and getting on the phone with people is the critical step.

Oh, and bring plenty of money. Depending n the product and the market, as a little guy you can easily run through $100K for legal, advertising, trade shows, and initial inventory on a product trying to reach a national market.

 

[lsimpson33]

Thanks @SecondCor521

This is the model I'm definitely hoping for.

I've also researched law clinics at law schools where you can get their help with a patent for a total cost around $1,200

 

[ERD50]

I was a SCORE mentor for 6+ years. ....

Oh, and bring plenty of money. Depending n the product and the market, as a little guy you can easily run through $100K for legal, advertising, trade shows, and initial inventory on a product trying to reach a national market.

Thanks for that perspective. I'm curious if you know how this works for marketing inventions and gadgets for a hobby market? There seem to be quite a few very small businesses that appear to be successful in some niche of a niche market (I'm thinking of beer brewing, wine making, wood working, music, etc). Many of them seem to start small, get some exposure on the hobby forums, lots of word of mouth (post?), set up a web site, and off they go. It may or may not be enough for them to quit their day job, but I see them around for years and growing their product line, so it must be enough to be worthwhile.

I understand that patents probably cost more than any benefit for something like this, but I suppose they still need a patent search to avoid getting a cease-desist from some other patent holder? But does it make sense that someone can start on a shoestring for something like this? I guess the internet kind of acts as the old craft or industry shows.

I've had some ideas for my hobbies, I'm not motivated enough to bring them to market, but my Son-in-Law might be. If nothing else, i just post them and people an DIY if they find it useful.

-ERD50

 

[Aerides]

for designs on products I think you want a trademark. Patent is usually for a concept that does something - widgets and gadgets.

I think some sort of design protection is mandatory before you engage the rest.

 

[OldShooter]

... I'm curious if you know how this works for marketing inventions and gadgets for a hobby market? There seem to be quite a few very small businesses that appear to be successful in some niche of a niche market (I'm thinking of beer brewing, wine making, wood working, music, etc). Many of them seem to start small, get some exposure on the hobby forums, lots of word of mouth (post?), set up a web site, and off they go. It may or may not be enough for them to quit their day job, but I see them around for years and growing their product line, so it must be enough to be worthwhile.

Yes, absolutely. IMO the key is "niche." I have a friend who was gunsmith to the US Olympic team, basically working out of his house at the end of a Tennessee country road as a solo craftsman taking care of and engraving high end guns. He "opened up" on the internet and worked the high-end shooting community to the point where he now has a couple of employees. The joke is that his road had no name but as the business developed UPS contacted him and said that they would no longer deliver to a no-name road. So he had to go to the county board to get his road named!

I had a SCORE client, brilliant guy, who was selling rock 'n roll branded t-shirts on the internet, working out of his house. Long story short, it grew to the point that he rented some space, which he has expanded at least once, and has a couple of employees. His wife was happy when moved out because he had their bathroom closet full of shipping supplies.

... does it make sense that someone can start on a shoestring for something like this? I guess the internet kind of acts as the old craft or industry shows ...

Yes. I happens all the time, but a large fraction of the niche-y sites you see are labors of love rather than being economic successes. I had another client, a speech pathologist, who sold teaching tools like puzzles and music. She loved it but struggled to make money. As far as I know she is still struggling. Her big issue was that she couldn't achieve the scale needed to have her products manufactured cheaply in Asia, so her margins were thin and real volume was not attainable without a big $$ gamble on inventory.

... I understand that patents probably cost more than any benefit for something like this, but I suppose they still need a patent search to avoid getting a cease-desist from some other patent holder?

Without knowing the OP's idea it's hard to say for sure, but given his market I think getting a good patent would be difficult for anyone. By "good" I mean broad enough to stop similar and copy-cat products. A narrow patent is easy; I have three or four myself that megcorp paid for. They are pretty useless. Principally they are ammunition for the constant megacorp patent wars.

for designs on products I think you want a trademark. Patent is usually for a concept that does something - widgets and gadgets. I think some sort of design protection is mandatory before you engage the rest.

Nope. A trademark doesn't protect a design at all. It protects a name and, usually, some kind graphical representation. For example, the name "Target" for a retail store and the Target bullseye. Example: Kleenex. How many identical products are out there under other trade names?

Life is full of risks. On the subject of small and startup businesses I think that in most cases the expense and delay in getting to market are not worth it. They are nice things to give the lawyer when you also give him the $20K retainer check to do battle with a supposed infringer.

 

[savory]

One additional thought to Old Shooter's comments which I agree with.

While it is a long shot and as Old Shooter said, be satisfied with the revenue from the niche, the other 'hit it big approach' is to gain enough recognition in a market that the big guys would prefer to buy your brand vs starting their own. If you can create a niche, even in a local market, that demonstrates to them there is a market. It would have cost the company a great deal to get to the same point. The Mrs Meyers cleaning brand, purchased by SC Johnson is a recent example. Instead of competing head on with Mrs Meyer, SC Johnson decided to buy their way into the category. I expect Mrs Meyer did well along the way and with the sale of the company.

On the other hand, when I was a marketing manager, there was a small manufacture who launched a product that we expected to fail based on our research. It gained market share for a few years in a row. Instead of buying them, it was less expensive to duplicate the product and launch it with superior marketing muscle. That product is no longer available. I expect that entrepreneur lost the investment required to expand his distribution. I think is the more frequent occurrence in the market.

 

[OldShooter]

Thanks, @davef. You emphasize another reason I am cool on waiting for a patent and that is "first mover" advantage. It is always A Good Thing, but as you illustrate it is not always enough.

In general, I try to discourage people from spending lots of time on what I call "the plumbing and the wiring." Most can be postponed and almost none of it are a real road block to doing business. Just get out there and sell something! You don't need an accounting package and a CPA until money starts coming in the door. You also don't need a sales tax permit (the state will disagree with this). Charge the sales tax due on your first few sales, the get the permit. Make good with the state on those sales or ignore them. No auditor will come calling. A web site is the counterexample; even the first customer will seek out a web site to test the credibility of the seller.