The independent inventor should consider licensing their 'patent rights' to an existing manufacturer and collect royalty fees.
Time Required: Variable
- If you have a patent or have applied for a patent (patent pending) you can attempt to license your invention. Technically, it is called licensing your patent rights, rather than licensing your invention. Non patented inventions can be licensed as well and the methods would be similar, however, extra steps would be taken that are not covered in this how to.
- Create a list of potential manufacturers who may be interested in your product. Aim for a list of at least 50 or more.
- Find manufacturers by looking in stores and magazines for similar products. Visit product related tradeshows. Your local library should have great reference material on manufacturers.
- Use "Online Manufacturer Databases" such as the Thomas Register to search for companies that make a product like yours. You can do an Internet search for manufacturers by using the keywords of your product.
- Send a brief individually tailored and professional looking marketing letter to each company on your list. The letter will state that, you are willing to consider selling or licensing the patent rights to your invention.
- With your marketing letter, it is superior to include a professional looking brochure and a website address connected to your product.
- Wait one month, if a company has not replied you can then telephone them to see if they are interested in your product.
- Before discussing your invention in greater detail with a company, sign a non-disclosure agreement. You should consider having a lawyer draw one up for you.
- If you have the opportunity to negotiate for a licensing agreement, use an experienced lawyer. It is not advisable for you to negotiate the contract on your own.
- The license agreement will include provisions for upfront payments, royalty percentages and infringement issues.
- A short one page color brochure with photos, that describes your invention and it's benefits, should also be included with the marketing letter. A second choice would be to send a copy of your patent drawings.