Wednesday, July 16, 2008

Inventing in todays Economy!

Many people around the country are feeling the slow down in today’s economy. We have all felt the rising gas prices at the pumps, the bursting real estate bubble and the stock market uncertainty. You have probably even decided to take that great new product idea you thought off awhile ago and put it on the back burner. Let’s face it, this may not be the brightest of economic times but it doesn’t mean we should all stop in our tracks. On the contrary now is the time to be more creative and to find ways to push forward. You don’t have to stop working on your goals nor should you. Reevaluate your situation and remember how inspired you became when you first had that new idea. Life is all about new growth, opportunity and experiences. Things will continue moving forward with or without you. Are you going to be on board or let someone else steal your thunder?

Business is still moving forward and in a big way. Take the recent agreement of Anheuser-Busch to be sold for around $52 billion dollars to Belgian Brewer InBev. Now, we all know that an individual inventor is not on this type of scale and I only bring this up because you will be surprised at the business deals still happening in this economy. When everything seems to be so negative it is important to focus and find the positive. Inventing is never meant to be a quick fix to your financial situation, but it can be a very rewarding opportunity. Like every new business venture it takes time and dedication to accomplish your goals. There are also plenty of ways to have more control over your project and keep a realistic budget. One of the best ways to stay in control of your new idea while maintaining a realistic budget is to create something you can start selling on a small scale. This can be accomplished with Limited Run Manufacturing. Even if you are interested in a licensing deal for your idea you should consider the advantages of selling your product on a retail level first. Because you have created your product and have inventory you now have the opportunity to make ROI (Return on Investment). Think of all your friends, family members and business associates your product would be great for. This is usually your first target market and it is where you should start to sell your new product. At the same time have a website created to add a true business look and dimension. It will also help you continue to expand on your marketing and sales. You should talk to everyone you meet about your new website, passing out business cards and flyer's with your company website and product information. Now you’ve created a storefront without the monthly rent payments so your overhead stays lower and your budget goes into the inventory not the rent. Of course, just like any new business venture there are no guarantees that you are going to be successful but you do have a fighting chance and you are keeping your risk level low.

Sometimes however, it may become necessary to raise capital for your new project. The most apparent reason is so you as the inventor don’t have to take on all the risk. Look at many successful business ventures and individual entrepreneurs. Even Donald Trump, he started out raising capital and having investors join his projects and he still does. The advantage you gain by producing your product will help in the ability to attract and gain investors. If a potential investor can actually use your product and see it selling you have increased the odds for them to want to invest. An investor can see the real potential and how there investment might grow. Think of it this way, would you feel more comfortable investing into an idea or new product that was produced so that you can hold it in your hand, test it out and see some sales. Or, invest in one that is still just a thought written down on paper? Every situation is different and pulling together investors can be a great way to keep your invention moving forward but remember the more hands in the cookie jar the fewer the cookies. So be very specific on the percentages each investor will receive and regardless whether your investor turns out to be a family member or a business associate document everything. Keeping good records can eliminate headaches later.

On a final note be sure to spend wisely. If you need help with your project and are going to pay for a service make sure it is going to be useful. Have the big picture in your mind and take each step according to your ultimate goal. Here is a very brief explanation and time line:

  1. Design your idea and search for similar products

  2. Prototype

  3. Check into Patenting

  4. Build your business identity (Logo, Website, Brochures)

  5. Limited Run Manufacturing

  6. Sell/License your product (Word of Mouth, Websites and Trade Shows/Events)

For additional information on any of these topics or for help with new product development visit Invention Support.

1 comment:

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