Should I license my product, or make it and sell it myself?
This is one of the most common questions I hear from inventors and entrepreneurs, and the answer is simply NOT simple…
First of all, you must understand that no matter what, embarking on either path takes knowledge and time, and you must be committed to seeing your project through. People often call me, telling me they want to license their idea and think it is easy and a quick way to make a lot of money. I tell them that getting a product licensed is almost always much more than what it appears.
It is not just calling a few big companies like Procter & Gamble and telling them about your idea, and then they put a big fat licensing deal in front of you. In fact, these companies reject most everything they see. They have to. They have access to an endless supply of inventors and thinkers who approach them with ideas. The fact is, they can only choose a few things that they can get behind and bring to market. They have budgets and internal constraints, too, and just cannot take on everything they like.
It is true that there are a handful of very savvy and talented people that can convince and negotiate with big companies to get a licensing deal. However, these people know what to do and how to do it. They understand that in order to be considered for a licensing opportunity, they must have a compelling product that can be patented and at a price that is compelling to them and the consumer – among other important factors. These people know what the licensee wants and needs, and they prepare their presentation to suit the specific company they are approaching.
They also clearly understand that they may get a lot of “no” before they get a “maybe” or a “yes”. It is not an easy path to take but certainly can be rewarding if you can prove to a company that your product has all the right stuff! The key is to learn everything you can about what path you want to pursue so that you are fully informed about what to expect and how to move forward.
For those of us that like to develop products and manufacture them ourselves, this path is traditionally much tougher, more time consuming, and requires much more of a financial commitment – but the rewards can be much greater. It is still a difficult but reachable dream. No matter what you wish to do, though, please realize that good old fashioned hard word and determination are some of the basic foundational components you will need to succeed.
So, which path do you take?
Well, that depends on your risk tolerance and the amount of time you have to devote to your invention idea. If you have a career and don’t want to run a business, then licensing may be for you. If you have always dreamed of running your own business and feel like you have the wherewithal to take your idea, have it manufactured, and then offer it to retail stores, then doing it yourself might be the way to go.
Whichever path you take, be patient! It often takes many months and even years to achieve success in this highly competitive business…just follow the correct steps and seek knowledge every step of the way.