It’s a sad but interesting fact that war creates the greatest amount of innovation over a short period of time. It seems we are very bold about creating ways to effectively kill each other brutally then we are about improving the quality of life.
This does, however, point to need as the biggest driver of innovation. So how does one explain the success of the Pet Rock and the Smurfs? People like killing each other while collecting odd little pop culture items!
Keeping ideas to yourself means one of two things: either someone else will eventually have the same idea and act upon it, or you can protect yourself and move it forward quickly. As with these two things, you have two avenues:
01. Partner with someone else who already produces similar ideas
This is tricky, as mentioned in part one of this two-part article. You need to protect your interests and that runs into lawyers, contracts, patents, non-disclosures and negotiating skills. If you can’t handle it, then you need the investment capital to hire the right people. One mistake and your great idea becomes someone else’s riches.
There are sites that claim they will take your idea and patent it, market it, etc. and so forth. They will also take the lion’s share of the profit… if you don’t get shut out. Check out any firm such as these THOROUGHLY! Some is better than none but how much is “some?”
If you want to approach a manufacturer, beware of the dreaded, “we are already working on this.” Corporations routinely steal ideas. Not necessarily as a part of the corporate structure but more individual people employed there who won’t mention your name when the idea suddenly comes from his or her mouth. The corporation will, however, certainly use all their resources to protect themselves from suits on stolen ideas.
Sometimes companies DO encourage outside innovative ideas. I was recently approached by a firm that wanted, “million dollar ideas.” They were also willing to pay $500 per idea they “accepted.” I gave them three, they bought two and said one “needed more work” so they would only pay $100.”
I turned it down and informed them I retained all rights. I eagerly await seeing the idea on store shelves so I can sue them. To date, I haven’t seen the other ideas produced. It was my hope that I could come up with a few brilliant ideas and then negotiate a higher fee, just shy of, “still ridiculously low” but a bit higher than, “you have to be kidding me?”
Not the best story of working with another company but not the worst, either. There are incredible horror stories of people who submit ideas and with enough of a small change, a company gets around the patent and makes money for the ten years the case will crawl through the legal system. They lose, then there are appeals, trying to collect and finally death takes you long before anything gets settled.
2. Do It Yourself!
As with the first avenue, you will be spending a lot of capital on services to assure you own all legal rights to the product. Along with all of that, you need to market the product, produce it, sell it, ship it and bill for it.
When dealing with retail stores, you should be aware that they will ask for discounts for larger orders. I worked for a company that got caught in that trap. A large department store chain wanted merchandise on an exclusive basis at 25%-50% off the original retail price. The company owner, seeing a huge order and dollar signs failed to realize that the final amount didn’t pay for everything it took to produce, ship and then handle returns for the merchandise and ended up going out of business.
Stores will ask for “markdown money.” This is for when the merchandise no longer is selling (it might be the market is saturated, they ordered too much for their customer base or they just never marketed it properly and you get stuck for that problem. They want money to lower the price or just ship it back. Dealing with retail outlets has some really touchy angles.
There are, however, other avenues when you do it yourself:
- The internet, home of porn, racist hate-sites, FOX News and Smurf video clips is also the perfect place to market your idea. Whether it’s a product, application, service your customers are just a click away! There are laws in every nation about return policies, so make sure you know those word for word.
- Zazzle and Cafépress will produce and ship certain products with your designs and you just take a percentage of the sale, so there’s little to no risk.
- For digital products and apps, you can either go the route of trying to get into the Apple store or on iTunes or one of the many other marketplaces that cater to smart phones.
- Shopping networks will give you a huge audience with massive sales in a short period of time but you have to jump through many hoops to get your product on the air and then must produce and ship quickly.
- Your Twitter or Facebook network. With good viral marketing, you can use the “1,000 true fan rule.” This is surprisingly effective and while you won’t become a bamillionaire, you can make a great deal of money with a ready audience willing to buy anything you produce.
- Trade shows brings customers to you! Rent a small booth and present your product. Orders can be filled in six to eight weeks so you can produce against orders.
Risk Is Not For The Meek.
The British SAS has an apt motto; “Who Dares Wins.” Owning your own business is not for the meek. It has a great deal of risk and investment. You can win, just break even or fail.
My late uncle was a rabid entrepreneur. He started businesses with my grandparent’s money and would have succeeded had he any patience for the great ideas he had. His problem was he became bored quickly and let his businesses slide into stagnation. It’s not just having an idea – it’s LOVING the idea to which you are committing.
You are embarking on what may be a life-long business, so make sure you will be in love with the idea and seeing it through for many years to come. Be prepared to work hard. Not 40 hours a week hard… I mean 80 to 168 hours a week hard. Be smart, tough and dedicate yourself to doing what’s best for you AND the product.
So many articles appear on design blogs about contracts and in the comment sections, people talk about their sorrow and lessons of not getting contracts or boast about how they don’t need one. In business, especially with stock that costs you money, you must be tough with your customers, producers, employees and everyone in between.
It’s not impossible to start a business with a great idea – it’s hard to keep it going. I had an employer who survived for many years on a great idea but when competition arose, it started chipping away at the business with more people grabbing for a piece of the pie (no, it wasn’t a pie business). Eventually it went out of business and now I see the competition mentioned in the news and trades. A great idea will sell itself but it takes a savvy mind to keep it running when outside forces start to become challenges.
With my late uncle, his challenges were with himself. For the business I just mentioned, the challenge was with outside forces. You must be willing to handle both, otherwise, just go back to avenue number one, spelled out above and take what you can get before someone else screws it up. Then move on to the next idea. There will always be more, just like the original Harry Potter book that became seven books.