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Thread: Patent sale

  1. #11
    Diamond Member AndyD's Avatar
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    I was about to point out that this is a 5 year old thread but what the hell, it's still got merit.

    Quote Originally Posted by Justloadit View Post
    ....
    The cost of development is small when you start to compare it to the cost of marketing the item, and selling it.....
    Wise words indeed but not just the cost it's the work also.

    It's amazing how many guys have invented something and just assume it will market itself and the customers will arrive at his garage or workshop and form a nice orderly queue whilst he tries to keep up with the demand that's organically growing exponentially in front of his very eyes.

    As you say the cost and the hard work begins only once the product itself has been developed.
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  2. #12
    Silver Member Greig Whitton's Avatar
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    Quote Originally Posted by AndyD View Post
    It's amazing how many guys have invented something and just assume it will market itself and the customers will arrive at his garage or workshop and form a nice orderly queue whilst he tries to keep up with the demand that's organically growing exponentially in front of his very eyes.
    The classic "Field of Dreams" fallacy. All I have to do is build it and they will ... hey, where is everybody?!

    Founder of Growth Surge - Helping entrepreneurs create more wealth and enjoy more freedom.

  3. #13
    Diamond Member Justloadit's Avatar
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    I grapple regularly with this problem.
    One thing I have learn't, is that nobody wants to be involved in the birth and upbringing of any product, they simply want to be there when it reaches adulthood, invest a Rand and then want to rack in the millions in return. You know what it aint gonna happen.

    Start off by getting a good pamphlet on your product, short and sweet, stop the damn waffling!
    I found the best is to do a list of pros and cons before writing the contents of the pamphlet.
    Look at the competition, and see what your product competes and wins and what it loses in. Take all the good points, and place it under a heading 'Features and Benefits'
    Keep the info short and sweet. Include some picks and basic description.
    Avoid using words like the 'best in the world', 'only thing that works' and other cliches.
    Use other pamphlets as examples for the content that you must place in yours.
    Get pamphlets printed, but include a section where a distributor can place his details, and avoid placing all your details on the pamphlet in which it can circumvent a distributor, you should place your details with a stamp in the section where it says distributor. At this stage you can not be the sole provider to the market, you are going to need distributors, and the worst thing is to steel customers from your distributors, they will drop you like a hot cake. They do the work and get no benefit. Have a website, which can be placed on the pamphlet, and when you get inquiries, pass it on to your distributors, don't try and take the business all to yourself. A successful product is only as good as the distribution chain. Break it, and the product dies.

    Then distribute the pamphlets where ever you can, with in the market of your product. Going to a street corner and giving pamphlets to motorists does not work, and wastes your money on the printed paper. You must target the market that will use the product, and get in there.
    Maybe sponsor a program at school, or local sports day, or donate to a school but ensure that your name and product is prominently displayed.
    Like an old marketer that I know use to say, "you got to wear the soles of your shoes to make it happen"

    Good luck, the hard work is still to come.
    Victor - Knowledge is a blessing or a curse, your current circumstances make you decide!
    Solar pumping, Solar Geyser & Solar Security lighting solutions - www.microsolve.co.za

  4. #14
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    Yip I agree. The idea, the design and production of a product are often the most straight forward part of the whole process. The leg work is in the selling. It takes huge effort compared to the other parts of the process (with a few exceptions such as building a nuclear power station).

  5. #15
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    Quote Originally Posted by Greig Whitton View Post
    Which financing options have you considered? It sounds like the sort of venture that would be too risky for banks (without a lot of personal collateral).
    I have been to the IDC but they explained that they have recently been burned by investing with somebody who patented a pool cleaner...

    The problem is that there are many pool cleaners on the market and most of them get the same job done.

    My product out classes anything in the market currently and saves the user time and frustrations and I suppose at the end of the day money too.
    My problem is a little different in the sense that originally when it was still a prototype I offered it to the big boys in the market and at first looked keen but when I gave them all the figures of the tooling costs and the royalty fees they pushed me away. I regret this today and wish I had done it differently.

    I must be honest here. I am not one for corporate meetings and a Marketing genius or no it all type of person. I consider myself too honest and somewhat of a dreamer. I think they saw me coming a mile away!

    The fact still remains that they do control the market and I agree with most of the comments in this post. I know it takes hard work and that is what we intended to do when we were first stumped by the big boys. I then decided to start smaller and supplying smaller pool shops, Super Spars etc, even Builders have come back to me again since I first posted here.

    The outlining problem in my case is not so much the type of product but at the moment can only be fitted to the most popular type of pool. Builders and many other suppliers want it to fit the other 3 main types as well first. So that falls back to finance as I just don't have the money to do another 3 injection mould tools and another two injection mould tools for the other two approved patents.

    The cool thing is my patents allow me to do this for the older pool types as well, but doesn't help if no one wants to get involved financially to make it happen.

    I guess I should keep trying to supply he smaller market on my own to try and create a "Demand" from the end user which ultimately should put pressure on the Big Boys that could very easily go big with this as they are already in all the pool shops and most chain stores.

    I am now even renewing my patents at CIPC myself as I can no longer afford the attorneys annual renewal fees. It really feels like I'm taking one step forward and two steps back. I knew it was going to be an uphill battle to get in the Market but expected too much too soon which yes, put me off somewhat.
    Unless I can magically arrange something with the Big Boys I don't think its going to fly as expected. The problem is that my tooling for this product is apparently way too expensive for these guy's to take over the manufacturing. They all say that they can build it for less. If I let them then I will be upsetting my Manufacturer who has helped me or part financed me for the existing tool and I still owe him about R120K so....its all about finance. I think if I had at least R500K I would then be able to complete the three products for all pools and still have change for some marketing.

    Perseverance is the key to success I suppose...

  6. #16
    Silver Member Greig Whitton's Avatar
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    Quote Originally Posted by Gfacius View Post
    I have been to the IDC but they explained that they have recently been burned by investing with somebody who patented a pool cleaner...
    From what you have described, the IDC probably isn't the best fit source of financing for you. Are you already manufacturing and selling these pool cleaners? (if only on a small scale) If so, there are some DTI grant funds that you may qualify for. Alternatively, the enterprise development funding that I mentioned in a previous post may very well be a good fit or one of the smaller entrepreneurial funding initiatives. You're welcome to PM me if you would like to discuss your options.

    Quote Originally Posted by Gfacius View Post
    The problem is that there are many pool cleaners on the market and most of them get the same job done.

    My product out classes anything in the market currently and saves the user time and frustrations and I suppose at the end of the day money too.
    How, exactly, does your product outclass the competition in terms of market benefits that customers care about enough to pay for as opposed to technical features? Why should someone who already has an inferior pool cleaner switch to your product, bearing in mind that you don't (yet) have a well established (i.e. trusted) brand?

    Quote Originally Posted by Gfacius View Post
    Perseverance is the key to success I suppose...
    Perseverance alone is often the key to failure. Too many entrepreneurs persevere with flawed ideas / plans / assumptions to the point of total ruin because subscribing to the "Field of Dreams" fallacy is easier than swallowing their pride and admitting that they might be wrong. Perseverance + awareness + adaptability is the key to success.

    Founder of Growth Surge - Helping entrepreneurs create more wealth and enjoy more freedom.

  7. Thank given for this post:

    AndyD (31-Oct-14), flaker (30-Oct-14)

  8. #17
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    The pool industry is one of those terribly cutthroat industries. I was heavily involved with led pool lighting before it became mainstream. We used to buy lots of aimflows from the big boys but once they caught on to what we doing with them they suddenly ran out of stock. They then got their own buddies to manufacture the lights. Another thing that happened was that they played us against another manufacturer telling each of us that the other could supply at an ever lower price. I decided to get out of the market because margins became so low that there was simply no point in continuing. Pool lighting is one of the most saturated markets now that the big boys have eliminated the little guys.

    Many injection moulding companies are happy to fund the cost of the mould is amortized over a number of moulded products. The proviso is that the mould stays with them and they have exclusivity to do the moulding for you.

    Another problem is that once your product is successful there will be many other similar products flooding the market from elsewhere. How do you stop 10 Chinese companies from making and selling your product? We live in an age of rapid prototying and 3D printing where anything can be duplicated and produced on a massive scale. Injection moulding companies have been milking the industry for far too long. They charge R120K for an injection mould because they always had the upper hand....those days are at their end.

    Does your product work on pools outside of South Africa? Our market is tiny.

  9. #18
    Diamond Member Justloadit's Avatar
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    He who owns the supply chain, owns the market.

    The big boys have deep pockets, and can afford to run at a loss on a specific product line, if only to crush the competition.
    They also have the resources to put a product to market, even if it means copying some one. Their attitude is that they will defend in court, and drag the case for as long as humanly possible, and by then the small guy has folded.
    Victor - Knowledge is a blessing or a curse, your current circumstances make you decide!
    Solar pumping, Solar Geyser & Solar Security lighting solutions - www.microsolve.co.za

  10. #19
    Diamond Member AndyD's Avatar
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    Quote Originally Posted by Justloadit View Post
    He who owns the supply chain, owns the market.

    The big boys have deep pockets, and can afford to run at a loss on a specific product line, if only to crush the competition.
    They also have the resources to put a product to market, even if it means copying some one. Their attitude is that they will defend in court, and drag the case for as long as humanly possible, and by then the small guy has folded.
    Which brings us full circle back to the value of patents to anyone other than lawyers.
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  11. #20
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    Quote Originally Posted by AndyD View Post
    Which brings us full circle back to the value of patents to anyone other than lawyers.
    Zip!

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