Top Licensing Tips For Inventors

Product licensing can be a great way for inventors to get their products into the marketplace without having to spend time and money marketing and distributing them. When it comes to product licensing, there are many pitfalls that can befall even the most experienced inventors, so it's important to do your homework and follow tried and true advice for getting your products licensed to major manufacturers.

Research potential licensees. Smart inventors have licensees in mind while their products are still being created. As you start to develop your products, come up with a list of manufacturing companies that would want to license these creations. A list of two or three manufacturers won't cut it; you should have several dozen potential licensees on the list so that you can research each of them and come up with the best licensing agreements for your own needs. You can find potential licensees by attending trade shows or by visiting online databases that house this type of information. If you get to the stage where a company wants you to present your idea to them formally, get to know everything you can about the company. Your pitch should show executives that you understand the company's mission, existing products, and target market.

Know your field. If you want to successfully license your products to manufacturers, you need to be an expert in your field. You should know who's in your target market, what other companies are producing similar products, what the potentials are for sales and revenues, and related information. Potential licensees will expect you to know this information, so you should be prepared. If you don't know this information like the back of your hand, you may get taken advantage of or have your products turned down by potential licensees.

Work with an attorney. A smart inventor never shares information about his or her products without having legal representation. Ideally, your products should be patented before they are submitted to any manufacturer. If a manufacturer requests that you sign any sort of nondisclosure agreement, have your intellectual property attorney review it. The money you pay in legal fees will be more than recouped if you are able to avoid the theft of your work or other legal issues. You should also work with an attorney when the time comes to negotiate a license so that you can get the most out of the licensing agreement.

Follow submission rules. Most manufacturing companies that work directly with product inventors have submission guidelines in place for when an inventor wants to submit a product for possible licensing. Make sure you follow these guidelines. If you don't, your submission could be rejected and you'll lose out on the opportunity to have a major company license your product.

Follow up. If you've sent marketing letters to each of the potential licensees on your list, you should follow up with them about one month after you send the letters. When you contact the companies, one of several things could happen. They may tell you that they have not had a chance to review your submission yet. If this happens, ask for a date that you could call back and follow up again. This accomplishes two things. One is that you have a planned date to call back so you don't need to guess if it's too soon to call. The other is that the person will be expecting your call and you may have an easier time getting through the barrier of a receptionist or administrative assistant. This may make following up on your submissions less of a hassle.