So, You Are an Inventor Looking for a Manufacturer? Think Again.

We’re recurrently contacted by self-described inventors who imagine very arduous of their product thought however do NOT need to handle that product’s growth, manufacturing, and sale. 

They’re typically good folks, sensible even. However they have an inclination to not be enterprise savvy, and that leads lots of them to make expensive errors.

That is very true for digital merchandise and comparatively complicated mechanical merchandise.

The million-dollar invention fallacy

The reality is, the proportion of recent product ideas which are actually novel, clear up a transparent want, and create substantial demand (with out the necessity for a advertising price range) proper off the bat, is low. Fairly low. 

Many individuals suppose one thing up, do among the design work (typically simply sufficient to speak what it’s and the way it might work, with out going into the engineering particulars), they usually suppose the ensuing mental property is value loads. Typically (I’d say 0.5% of the time), that’s true.

So, what does the inventor do? He (in 99% of instances it appears to be a he, not a she) seems into registering a patent. If the product has been named, trademark(s) are additionally registered. 

All these authorized protections quantity to some huge cash. Typically over 100,000 USD.

And that cash is, normally, put down with out severe market analysis. Potential clients/customers usually are not offered with a mockup of the brand new product. (In any other case, they’d notice it’s a million-dollar thought and would run away with it, proper? Or so the pondering goes.)

Large mistake. The chance of somebody stealing the thought and attending to market first is MUCH decrease than the danger of spending giant sums of cash on a product that has no market. I wrote about this in Patents Ought to Come After Market Success.

The issue is, simply an thought is value nothing. 

Derek Sivers put it properly in his article Concepts Are Only a Multiplier of Execution. “Concepts are value nothing until executed”.

And conventional buyers observe the identical logic. And not using a working prototype in hand and an organization already arrange, there will likely be no funding.

And attending to the purpose the place a prototype is authorised can require a considerable funding.

So, the place to discover a non-traditional supply of funding? 

Many inventors look for a corporation to deal with and finance the product growth, deal with and finance the manufacturing, discover clients and drive gross sales, preserve clear and correct information of all of the gross sales, and ship a share of that quantity to the inventor.

In different phrases, they need to do nothing on the execution facet of the equation, the place the worth is created. And, normally, I’ve the impression that they find yourself disillusioned. I’ve seldom seen that “licensing” or “royalties” mannequin work on this context.

[Update: a reader pointed to the fact that some businesses are doing pretty well based on a licensing model. Fair point. But I would definitely not contact manufacturers in China to act as licensees.]

What’s the confirmed mannequin for bringing a brand new product to market?

What I’d name “the basic means of bringing a brand new product to market” is as follows:

1. Conduct market analysis to ensure there may be demand and to establish what the highest characteristic(s) is within the minds of shoppers
2. Innovate on the product, with out sinking disproportionate quantities of cash in patents
3. Discover companion(s) that complement your skillset and might deliver time & cash
4. Spend some extra time to search out methods to take away threat from the mission: keep away from custom-designed elements, preserve the product easy in its model 1, and many others.
5. Make investments some cash to finalize R&D, till a last prototype has been confirmed, and use it to lift cash from buyers (or Kickstarter) if wanted
6. On the similar time, begin to work in your advertising channels (e.g. Fb adverts, a community of distributors…)
7. Put money into opening the molds (if any), for the primary manufacturing batch, and for promoting the merchandise
8. Handle the entire course of, particularly on the advertising & gross sales facet

I went into this in additional element earlier than. I confirmed that founders have quite a lot of work on their plate.

Conclusion

It’s quite a lot of arduous work, and it’s a dangerous enterprise. You actually need to WANT it, and it’s a must to imagine very arduous in your product. However that’s the purpose. If another person is in control of making your new product a actuality, will he/she be as motivated as you?

Are you designing, or creating a brand new product that will likely be manufactured in China?

Sofeast has created An Importer’s Information to New Product Manufacturing in China for entrepreneurs, {hardware} startups, and SMEs which provides you advance warning in regards to the 3 most typical pitfalls that may catch you out, and the perfect practices that the ‘giant firms’ observe that YOU can undertake for a profitable mission.

It consists of:

• The three lethal errors that may damage your skill to fabricate a brand new product in China successfully
• Assessing when you’re China-ready
• How one can outline an knowledgeable technique and a practical plan
• How one can construction your provide chain on a stable basis
• How one can set the fitting expectations from the beginning
• How one can get the design and engineering proper

Simply hit the button under to get your copy (please observe, this may direct you to a web page on my firm Sofeast.com):