How to License a Product
Most inventors of a product are very talented when it comes to making new things but very poor when it comes to manufacturing as well as distributing some of their product that they have invented to make it on the top of the list of the market.
If you are one of these inventors, the best way to secure your product is to license it to a much larger and more capable corporation or business establishment.
If have decided to license your product on a particular corporation, that corporation is what everyone calls the licensee. More probably, the licensee will buy the rights as well as the patents on your product. They will also pay you huge amount of money with regards to your product sales. This usually ranges from three percent to ten percent. Thus, you will have no regrets on giving the manufacturing as well as the distribution matters on the hand of the licensee. Here are some of the tips on how to do it properly.
Complete the Requirements
First is that your product and the requirements that goes along with it are complete. You have to finish the entire initial tasks that are required from you and your product. This is before you license it out to your chosen corporation. This will include the patents, details on the mechanics of your invention and how it works, prototype production, information as well as test on the target market, and the list of the goals for your product.
Once you have done all these requirements, determine whether you are going for a non-exclusive or an exclusive license. The difference between the two is that in exclusive licenses, you are going to work with just one license while the non-exclusive license will give you capability in licensing your product with more than just one company.
Important Things to Remember
You will also need to calculate the license agreement’s value. You can do this by determining the value just by comparing the product that you have made to other products of similar kind within the market. Also decide on the developing cost of your product or its profit margin that your work could accumulate if it is sold. Then, you can now search for your target corporations. In searching for the right corporation or company perhaps, you should determine whether these companies will have an interest to license, produce, as well as sell the product that you have created. To make it much easier, choose those companies that are selling the same products as yours. Next thing for you to do is find the contact person who is tasked by the company to license your product and deal with him. Never forget to include your confidentiality agreement once you make a deal with your prospective licensees.
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