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Presenting Your Idea to a Company (306 hits)

The story is a familiar one. An individual has an idea for a product. They submit the product idea to companies, but none of the companies are interested it. The individual is puzzled because this product would be a sure-fire success. In addition, the individual does not know what else to do to generate interest from companies.
Several reasons can explain a company’s lack of interest in a product. One reason is that accepting product proposals from individuals can be risky. Many companies develop their own products, which could be similar to the product proposal of an individual. A company wants to avoid the situation where it would have to prove its own knowledge and ownership of a product idea prior to receiving the same or a similar idea from an individual. For this reason, a company may not review the product idea or would only review it on the company’s own terms. The company terms may not be favorable to the person submitting the idea. A second reason for a company’s lack of interest is that the submitted idea may be inconsistent with or unrelated to the types of products that the company currently produces. A third reason for a company’s lack of interest is that the company just does not like the idea. Even though a company may choose not to pursue a submitted idea, their decision is not an indication of the commercial viability or potential commercial success of the idea.
Although the process of presenting an idea to a company can be challenging, there are three things an individual should consider doing prior to presenting his or her idea. First, the individual should secure some form of legal protection for the idea. At minimum, there should be a pending patent application on file with the United States Patent and Trademark Office. If the idea is artistic, copyright protection should cover it. Second, one should research companies prior to submitting proposals. Research helps one identify companies that are compatible with the proposed product idea. Interest is usually from companies that produce products that have some similarity or relationship to the proposed product. From research, one can also learn about the terms and conditions under which a company will review a product idea. Third, the individual should consider doing some small-scale commercialization of the product. This activity involves producing a limited number of units of the product and selling these units. The purpose of this activity is to establish a market for the product and generate sales data. Remember, the product is not yet in the marketplace. A factor that will interest companies in a product idea is objective evidence that products based on that idea will sell. It is great that an individual has confidence in his or her product; however, it is also important to have actual sales data that supports the individual’s confidence. In addition to sales data, this limited commercial activity will generate information about the costs associated with manufacturing the product, the retail selling price of the product and potential profit margins. Companies use this information as part of their product evaluation process. This commercialization information is also useful to an individual when approaching potential investors.
Many companies are very cautious with regard to accepting externally generated ideas. Therefore, the individual should present the idea in a manner that will illustrate the benefits to the company in terms of product line expansion, increased market share and increased profits. The individual also wants to convey the message that the product is commercially viable, but they need to partner with an organization (the company) that has the resources and capacity to meet the market demand for the product. An excellent way to communicate both points is through data that illustrates the product’s current commercial success and future potential. Furthermore, a successful limited commercialization of an individual’s product may catch the attention and interest of a company. When a company becomes interested in a product, the company may actually initiate contact with the individual product owner. In this situation, the individual may have more leverage in the product negotiations.
For some ideas, the best approach is simply to secure as much legal protection as possible in the form of patents, copyrights, trademarks and legal agreements and as much product market information as one can gather and then present the product idea and accompanying information. For more information visit www.dwalkerlaw.net and www.youtube.com/user/godyideas.

Posted By: Darcell Walker
Thursday, January 21st 2010 at 3:38PM
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