How To License or Sell Your New Product

The following article is from Bloomberg Businessweek Small Business Section:

Smart Answers:  “License or Sell Your New Product” by 

I have a registered trademark for my product. I am looking to match it with a certain type of company but not having much luck on my own. What kind of professional can I hire to help match me with the right business? —N.B., Rockwood, Me.

As you’ve found, it’s not easy for an entrepreneur to approach a large company about buying or licensing a new product. Corporations worry that if they look at your product, but pass because they already have something similar in development, you will sue them later. Most big companies invest in their own researchers who are constantly tweaking existing products and working on new ones.

Meeting with entrepreneurs can be a waste of time for these businesses when, realistically, very few new product ideas are commercially viable, fit well into existing product lines, and can be manufactured and distributed profitably. For these reasons, many companies simply refuse to entertain product submissions.

There are ways to identify those companies that might look at your product, however, and specific things you can do to help your case. You’ve already taken a big step forward by getting intellectual-property protection. If you can construct a sophisticated prototype, conduct market tests, and get excellent feedback from end users, that will also help.

There are professionals who assist fledgling companies with market research, business planning, and new product development. However, they’re not always easy to find and most definitely are not cheap. You also run the risk of unwittingly hiring an unscrupulous company that will praise your new product profusely, tell you that it has excellent market potential, and then charge you an exorbitant amount (as much as $20,000) for a useless report that won’t get your product on store shelves. Advice for avoiding such scammers is available from thispage on the U.S.Patent & Trade Office website, and from this page on the Federal Trade Commission’s site.[...]

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