One of the hardest parts of becoming an entrepreneur with a new idea is creating a product development strategy. Getting ideas from your head to a finalized prototype, from a prototype to manufacturing, packaging, shipping, and eventually retail.
When I tell people about my invention, they get excited and think I can go on Shark Tank and my product will magically appear on the shelves of every retailer the day after. I constantly get the question – is your product available yet? I NEVER think of this question in a negative light because that means people are thinking of my product! However, it can feel hard explaining even a small part of this process to help people understand it.
I wish someone would have told me these things when I first started; so I’m telling you.
So you suddenly have a bright idea and you think, if this were on the market, it would sell! The first step of product development is to make sure this idea isn’t already available on the market! You wouldn’t want to spend all your time creating something that’s already available for retail sale and use. Turn to your friend Google and search for everything that describes your idea.
I once had this idea to make a “knife-pal” product that had a handle with prongs that would go into your fruit and assist with knife cuts and chopping. Thinking this would be great for people with arthritis and kids to more safely learn to cut. I couldn’t find anything like my idea on the web but then when I searched for the description (handle with prongs for chopping) Amazon.com returned an onion slicer that looked very much like my great idea. So I purchased one and we love it! We use it for all kinds of chopping, not just for onions. But, someone else made it first so I became a customer.
The second place to search is the patent database on the USPTO website. Someone may have patented this idea already but not put it into retail. In this case if you wanted to use their patent to go to retail you’d have to pay them to license their idea to you. Again, search for description words, not a product title. When looking for my idea for a litter box cleaner I searched “sifting litter box”, “sifter”, “litter box”, etc. Within each patent, read the claims and look at the drawings to ensure they don’t cover what you’re trying to invent.
Claims in patents are meant to be very broad in language to make sure no one can change one small part of an invention and create a knock off without penalty. Does this prevent people from creating a knock-off? No, but it does allow the inventor to sue them for any profits or losses if they do.
By this time, you’re pretty sure this was your idea first and you are ready to put it into action. The next rule is to keep your idea a secret. I know you’re so excited about your idea and you want to tell everyone about it. It has nothing to do with whether or not you trust someone to keep your secret, if you disclose your idea to someone before filing a patent application they are free to use your idea however they like. Therefore you need to ensure you only work with people you trust AND they sign a confidentiality agreement before any discussion ensues, this protects your product and product development. The website IP Watchdog has a great article here about why this is necessary along with some free confidentiality agreement templates.
Now is the time to put your idea into action. Start sketching out the parts and pieces of your idea. Patent experts recommend to do this on a bound notebook so you can keep everything together and later prove all of the sketches are your own.
You need to know what each piece will be made of, but having the sketch allows you to discover what it will need to function. You’ll want to draw your invention at many angles and get an idea of the general shapes and functions of each part.
From your sketches, you should have a basic idea of the parts of your invention and the shapes of those parts. Now go to the nearest hardware store and look for materials to make those parts. This is the first tangible step in your product development. Alternatively, if your invention is electronic or technical you can look online to enlist the assistance of an engineer to help make your design a reality. If you are an engineer already, you might put all the electric pieces together and enlist the help of a 3D printer to print out the outer frames for your electronics. There is a television show on the History channel; Million Dollar Genius which shows inventors going through this process from start to finish.
When I made my first prototype, I used materials that didn't work in the long run, but the materials were great for facilitating my first prototype build. Use what you have, it won’t be perfect, the first time will always need work.
My first prototype
I also needed some other materials that I didn't know how to combine and apply them to my product. I enlisted the help of a store associate, asking for guidance on how to attach certain materials. I didn’t discuss the utility of what I was making, just the task I needed to accomplish. We walked through the store together and came up with a plan for my design. I brought all this home and built the first prototype of my invention.
Now you need to refine your prototype in product development to its final version which you will use for injection mold design (more about this later). The process of refining your prototype can be a long one. You need to use it, ensure it works the way you want it to, and if not, change it slightly and try again. When I used my first prototype, I was getting litter everywhere! I needed a way to prevent this. So I went back to my sketches and sketched some sides into my sifting basket. Since I had no means to build solid sides on my own, I enlisted the help of an engineer who could turn my drawings into 3-D printable designs.
3-D print design
This process is called rapid prototyping and you can turn to google and search for “rapid prototyping near me” and find an engineer who can help you in this process. Before discussing your idea with anyone, send them a non-disclosure agreement and have them sign it and send it back to you. You can accomplish this via email and any reputable design or engineering firm will want to do this to prevent any problems, or halting your product development. If not, just move on, as the integrity of your product is on the line. It took a few months of re-printing and re-designing before I had a prototype that did everything I imagined. At the end of that process, I even had animated pictures of my design that came from the 3-D design software.
To create an injection mold, finalize your design in 3D CAD with an engineer who specializes in manufacturing. Executing every detail of the design in a way that works for manufacturing your product in a cost-effective manner. For example, plastic pieces hollowed out to reduce costs. Do this right the first time, because once they make a mold out of steel, there’s no going back. You’ll also need to find a manufacturer who can create your injection mold. Again, a search on google for “injection molding near me” can help, or your designer may have some useful contacts.
An injection mold is referred to as a “tool” by manufacturers because it is a tool that makes your product. Once you find your injection mold manufacturer and submit your final design the real cost and time commitment begins. Most molds made in China either stay there for manufacturing or are shipped back to a local manufacturer for production. The cost of the two molds (tools) required to make my product was over $60,000 after creation and shipping. It took 14 weeks to create the tool and another 4 weeks to ship it back. Explaining this to your backers who may not understand how a product is made can be hard.
Intellectual property is what separates a hobby from a business. It allows you to create and sell an item that separates you from your competitors. Work with a patent attorney to file your patent. They can explain the difference between a provisional and non-provisional patent, do a complete global patent search to ensure no one else has thought of this idea, and write claims that will stand up when the patent office reviews your application.
It would be terrible to go through the entire process of product development, and filing a patent on your own to have it rejected and all of your hard work and money wasted. Therefore pay a patent attorney to do it right the first time. I found my patent attorney on upcounsel.com. After posting the job, I received several offers and free consultations from attorneys, allowing me to choose the best fit for my needs. This will cost you around $2000-$5000 depending on your needs.
Once your tool is created 1,000 units can be made quickly and cost-effectively. For example, the manufacturer can make 1000 units of my product in only 13 hours, which feels quick after the hurry up-and-wait process of designing, and mold making. Although you might be able to make each unit for a few dollars, you’ll need to use the “profits” made on each unit to pay for packaging, shipping, marketing, and any debt you might have incurred in paying for the tools. Make sure to calculate this into your cost of goods sold. If you ever make it to Shark Tank they’ll want you to understand these numbers as this is an important part of your product development strategy.
To learn how to find a manufacturer in China and protect your idea with the right contracts, check out our Concept to Launch course, which walks you through this process step by step from concept all the way to launching your product on Amazon and beyond.
How will you sell your product? Online, in retail stores, and/or on your own website? You’ll need to determine this and set up accounts with each vendor, apply retail packaging, and drop ship to the vendor or directly to your customers. Some manufacturers will also drop ship for you. Again, turn to google and search for “drop shipping near me”.
Work with a local packaging company to design your packaging for the type of sales avenues you’re entering. For example, if I’m just selling on Amazon, I might not need expensive packaging that would stand out on a retail shelf, but in that instance, I need great photos to display on the site. A local packaging company can help you with inner and outer packaging. You can then provide this printed packaging to your manufacturer and they can assemble and drop ship your product. With a plethora of options, it’s best to discuss options with the companies you’re working with.
First you’ll want to register your business. Talk over the type of business filing, and tax benefits you will need with a business attorney or trusted CPA. These are people you’ll want on your team to ensure your personal assets are protected separately from your business. I was able to hire a local attorney to file everything for me and draw up all the necessary legal documents for around $1500 plus a very informative free consultation after which I could have filed on my own if I chose to.
I found my business attorney by attending free business classes offered by my local Small Business Association. You can go to SBA.gov and find lots of free resources near you to assist you in starting or growing your business. Next, you’ll want to start bookkeeping and find an accountant to assist you in filing taxes. Most accountants recommend Quickbooks software and will help you set this up.
You’ll also need to have the means to accept payments and keep your business separate from your personal finances. Find a local bank that works with small businesses and open an account in the name of your business. To do this you’ll need your state business filing and a EIN from the IRS. You can apply for an EIN yourself in just a few minutes on IRS.gov. Last, you’ll want to consider purchasing business insurance. Business insurance is fairly inexpensive. Protecting you from being sued by a customer or competitor by covering the costs of a legal battle. Your bank may have an insurance expert to help you. If not, Google is your friend.
No one person can possibly understand everything about manufacturing, sales, production, patents, product development and business. Many businesses fail because entrepreneurs fail to seek the help of an outside expert when they don’t completely understand something. Maybe you feel you can’t afford an expert. I’ve had many people tell me to file my own business docs instead of seeking an attorney’s assistance. “It’s easy, they said, just pay the $300 and fill out the one page form”. If I had followed this advice I would have filed an assumed name for my business, tying it to my own personal name instead of my business. In litigation, someone could come after my personal assets, because of that. Therefore the $1500 I paid to have everything done properly with my originating documents could protect me from losing everything I worked for in the future.
Take advantage of the free expertise already offered. There are free business counselors and mentors available through the local Small Business Association that will help you along from start to finish. You need to have a solid business plan and update it often, especially if you want an investor to help you financially.There are many free templates available through sba.gov. Failing to plan is planning to fail. Learn everything you can about sales, marketing, online presence, search engine optimization, business planning, and legal requirements and execute what you can, and hire out what you can’t. There are many resources available to you, but it’s on you to take advantage of them. Check out our company Amazing at Home, and our Concept to Launch course!
Some believe a good idea is enough to gain riches; this is not true. If you don’t have a plan or a means to sell your idea to the world, it remains just an idea. Product development strategy is the key to making your idea real.
Amy Wees is the CEO of Amazing at Home E-Commerce Consulting. Her coaching focuses on helping brands develop unique products, validate them in the marketplace, source at profitable margins, and launch with amazing brand messaging, copywriting, and search engine optimization. Schedule a virtual coaching session at https://Amazingathome.com