How to Bring a New Product to Market
The 2 primary routes to get a product to market once an idea is protected and prototyped are:
Licensing is a route to market through which a partner company takes on all responsibility for manufacturing, distribution, and marketing of the product, while you retain a percentage of the profits earned. This approach to getting a product to market involves less risk and less work, but also less profit potential should the product launch be successful.
Business Start Up
The alternative route to bringing a product to market is starting up a business, through which you take responsibility for all manufacturing and distribution, whether done through outsourcing or your own channels. In addition to the increased workload and risk, you also keep a much higher percentage (if not all) of the profits.
Bringing a New Product to Market Summary
When deciding on how to a get a product to market, the decision as to which path to choose may ultimately rest on funding, time and capability. However, you do not have to definitively choose between these avenues in order to progress your project. It is possible to change path at any point and sometimes even combine these options. A famous example of this is James Dyson who licensed his dual cyclone vacuum cleaner technology to manufacturers in Japan and used the royalties he received from this to set up his own manufacturing and marketing company within the UK.There are other options available for introducing your product to industry such as selling your intellectual property protection, but there are few instances in which this is beneficial. Often a person or company can lose out money by selling up at this stage, as the value of your Intellectual Property is minimal when not marketed compared to its potential turnover, if successful at market. Therefore, the potential royalties that could be accrued over a period of time may far outweigh any lump sum offered to you at such an early stage.It is important to remember there is no set route for how to get a new product on the market. Each new inventor will find their own path and although hearing other peoples’ experiences can be beneficial, you will ultimately have to find the right route to suit you and your product.