This year, where should you focus your creativity to get licensing royalties? Here are the top 10 industries with a history of licensing ideas from individuals for your consideration:
1. Toy and game
Since the beginning, the toy industry has been open to innovation. Brian Chapman is the president of Hasbro and the head of global development and design. He claims that between 50 and 60 percent of Hasbro’s portfolio was born out of an outside idea.
Recent developments have seen Hasbro invite amateur and novice toy inventors for pitches. Why? This industry, just like fashion, requires constant supply of innovative ideas each year. The turnover is rapid and furious.
The United States saw a 20 percent increase in toys sales during the first three quarters 2020. It’s not surprising that families are forced to live at home and have created new traditions, ways of entertaining one another, as well as new habits.
Bring your enthusiasm and ideas to pitch!
2. Pet
It’s hard to not love your pet cat or dog. Since 1994, Americans have spent more money on their furry friends each year. According to the American Pet Products Association, Americans would spend almost $100 trillion caring for their pets by 2020.
Independent inventors have been involved in the pet industry for many years. I have seen many products licensed in this sector since the pandemic. It is preferable to have prototypes. Intellectual property is less important.
Over 65 years, the president of a family-owned pet business told me explicit: “If we have an invention that we believe we can manufacture and first to market, then we will proceed and we will negotiate a royalty agreement even if we don’t have a patent.”
3. As Seen on TV
Direct response television is also known as “direct reaction television” and it is well-known for its fast-paced marketing of hit products through video and calls to actions. ASOT companies are not content to market their products via infomercials or social media. Although this industry can be difficult, you can still find a goldmine if you have the right product and the right price.
ASOT companies used to only seek products that were popular in mass markets and had a limited price range. This has changed. This industry seeks a wider variety of products at different prices, thanks to the fact that niche consumers can be targeted using social media advertising.
This is an industry where you can pitch your product idea if it has a strong wow factor. It won’t be enough to make minor improvements to existing products. Prototypes are needed for new products.
4. Kitchen/housewares
Since many years, this industry has licensed ideas from inventors. Reach out to companies that are looking for the next generation of kitchen gadgets if you have an idea. Many kitchen companies are looking to make minor changes to products that have been in production for many years. To pitch these companies, you can create a Sell Sheet. This is a one-page advertisement that highlights the major benefit of your idea.
If you are interested in a prototype, be prepared to make one. A proof of concept is essential. This industry is a great way to save money and keep your health in check.
5. Hardware
Another industry that has prospered in the last year is this one. There has never been a better moment to submit your ideas for hardware companies that have been working with independent inventors over many years. Be sure to file your intellectual property and have your prototype ready.
6. Gifts for the discerning buyer
Because the stakes are low, this has been an industry I have always loved to create ideas in. These companies are open to invention and don’t require prototypes for their pitches. Although most cases do not require intellectual property, it is a good idea to verify.
Here’s a tip: Create something that sells every day and not just seasonal items.
7. Juvenile and baby
This industry was historically difficult to enter, but I’ve been seeing more ideas being licensed in this particular sector. Get your creative juices flowing, dads. You deal with children’s problems every day. Consider what products you would find most helpful and then create them.
8. Outdoor/gardening, and Barbecue
The popularity of gardening and other outdoor activities such as barbecuing is increasing. In the future, homeowners will be more conscious of how their outdoor spaces can be made more comfortable. These industries are historically very supportive of inventors.
9. Fitness at home
This is a booming industry. Although most gyms have closed, everyone needs to keep fit. This industry was not open to independent inventors when there were few large manufacturers of large pieces for home use. This is changing. It’s no longer about expensive, bulky equipment for home fitness. Doors are opening.
10. Beauty and health
The industry has a long history working with outside product designers. It is a good idea to file intellectual property before you approach a market leader. Large market leaders have the resources, and the incentive, to enforce their intellectual properties portfolios. Proof-of-concept in this industry is crucial.
Do your research on the company’s past history with working with inventors before you submit any product ideas. Is the company inventor-friendly? To make sure, check.
Remember that midsize businesses are more hungry for product ideas than big market leaders. They will respond to you quicker and are more likely appreciate your hard work. Make sure that you have the right intellectual property before you reach out to any company. Below are some of the most well-known companies will purchase new invention ideas.
Companies that take suggestions
a. New Soda
New Soda creates kitchen gadgets and welcomes suggestions from people. Anybody can submit ideas. Each submission will be reviewed for technical feasibility and profitability. New Soda will pay royalty fees for any idea that becomes an actual product.
There is nothing you can do except to submit the idea. New Soda will manage all investment and development. The company will build a prototype of the product and then display it at exhibitions and trade shows to gauge the public’s reaction to the design. If the product proves promising, further development will be done to add color options and packaging. New Soda then sells the products via its network of agents once they are mass-produced. Each unit sold earns you a commission.
b. Invention City
Invention City does not restrict the product categories. Anyone can submit a concept drawing or idea for any product design to Invention City. There are both paid and free submissions. Paid submissions can be done through the Brutally Honest Reviews process and cost $95 for each idea. Invention City will require you to perform self-evaluations using the Investigator tool if you choose to use the free option. Brutally Honest Review options include feedback about the invention, a report on research, and a suggestion of the next steps.
You cannot submit a free submission form. If you don’t hear back within five business days, it is likely that the answer will be a definitive NO. Invention City doesn’t manufacture the product idea, but it offers a licensing agreement with a royalty up to 5% for every sold unit. The sub-licensing structure will pay between 20% to 60% of the revenues. The website states that the company will only offer deals to 1% of all submitted ideas with a 10% success ratio.
C. Henkel
Henkel offers three product categories: adhesive technologies and beauty care. TECHNOMELT and BONDERITE are some of the most well-known brands. Henkel has a partnership program for inventors, which is different from Invention City’s licensing deals. Henkel claims it doesn’t just focus on professional inventors but also students and everyday customers.
Patent holders are allowed to submit ideas for any product category. Those without a patent may submit ideas for adhesive technology or home care innovation. The company doesn’t specify the exact amount or the percentage of royalties for your ideas. However, the website states that the Henkel Innovation Partnership Program will pay you a fair share for your innovation.
c. FastCap
FastCap is owned by Paul Akers and specializes in woodworking tools for professionals. The company has been constantly looking for new ideas to improve the woodworking industry since 1997. FastCap products are largely the result of concepts from cabinetmakers and contractors. The company usually pays 5% royalty for each idea that is presented and made into a product . Inventors may accept only 2% in some cases, such as when their ideas are complex but have a low margin of sale.
The percentage is based on the product prices that were sold to distributors and not end-users. It can provide a passive income of real value for inventors as the royalties are paid out each month. FastCap provides all of the funds and resources necessary for development. It is not necessary to obtain a patent before the idea can be submitted. FastCap will assist you in obtaining a patent, both in your name as FastCap, if necessary to protect your intellectual property.
D. Ideas Buyer
Idea Buyer is a simple development company. It does not sell products but helps inventors realize their ideas. The majority of the products are sold through the company’s market partners, which include Amazon, Ace Hardware and Lowes as well as Home Depot and Walmart.
This is the process:
- Use the online form to submit your ideas to Idea Buyer. Although it is not clear if every submission will be reviewed by the company, they promise that a representative will get back to you within 48 hours.
- The Idea Buyer will offer a joint venture if the idea is chosen. Based on your explanation, you will be involved in the prototyping process and the manufacturing process.
- Here is where you can discuss money issues. Once you accept the invitation, the real collaboration begins.
All submissions are confidential. The Idea Buyer was founded in 2007 and has helped launch over 2000 products on the market.
E. Nokia
Nokia can accept invention ideas in one of two ways: privileged or general. Only the difference is that a general submission does NOT guarantee ideas’ confidentiality. After an idea has been selected, it will be sent to the privileged route, where the inventor and company sign confidentiality agreements. If you are invited by Nokia to register or request promotion, you can choose the elite route from the beginning.
A detailed report on the design is also provided. Nokia also allows you to choose financial rewards. Although it is not clear how much you will receive, the company promises that they will pay anywhere between EUR10,000 and EUR75,000 to transfer your IP rights . Nokia will pay the costs of patenting, although the reward for retaining the IP rights under your name is smaller.
F. The Quirky Case
Quirky is often mentioned as a company which pays everyday inventors for their product ideas. People believe that the program is still available, but it has changed in recent years. The official website address in Wikipedia is not the right one.
Quirky filed Chapter 11 bankruptcy in September 2015. All assets of Quirky, including its Wink smart home platform were sold. Quirky’s current status is not known. Sources claim that the company is still in existence, but it has abandoned the old model for manufacturing public-submitted ideas. Quirky now uses a licensing model with business partners such as Vanderbilt Home Collections and Shopify.
Accepting idea submissions by companies
Although the companies listed below will accept ideas, it is not clear how inventors will be compensated.
a. Bosch
Bosch currently accepts submissions of ideas and designs in four product categories: automation (professional tools), DIY tools (DIY tools) and ECU. Bosch is seeking a partner to help develop new product designs through the Bosch Open Innovation Partnerships. The initial assessment phase may take up two weeks to review all submissions and provide feedback.
If the company is open to the idea and is willing to form a partnership, then the concept is sent to the in-house product design team for further review. Bosch provides an advisor to assist the inventor in product development. Any inventor who makes it this far is already a business partner. Bosch doesn’t mention compensation, however, it is likely that it is part of the partnership agreement.
b. Under Armour
Under Armour is a well-known clothing brand. They have a simple submission form that allows you to provide your personal details and description of the product idea. Submissions are allowed for four product categories: Apparel and Digital, Accessories, and Footwear. It doesn’t accept ideas from outside the United States.
c. Dorman Products
Dorman Products welcomes your ideas if you believe you have a better solution for automotive repairs than any of the ones currently on the market. The online form and the hotline are available for inventors to pitch their idea. The website doesn’t explain how each submission will proceed.
d. BD
BD is a New Jersey-based company that develops and sells medical products. Anyone can submit product ideas to the company via an online submission form. An attachment of a PDF or text document may be attached. This will allow you to provide a sketch of your product design. BD recommends that you do not submit anything confidential. The company must sign confidentiality agreements once the design has been selected.
e. Jokari
Jokari claims that the company has assisted inventors in developing and introducing some of the most popular products over the 50-year history of its operation. The company has produced many products, including handyman tools and storage solutions. Every idea submitted will be reviewed by “Davidson”, a third party company that handles confidentiality and manages the idea process. Jokari recommends that you do not submit details about your invention. The company will only need to know the inventor’s basic information.
Related: How to determine if your invention idea is good
f. Wilson Sporting Goods
Wilson sporting goods is the name of the volleyball Wilson, which was featured in the Cast Away movie. The company will accept ideas, but its Terms and Conditions state that they only allow submissions from internal research teams. Wilson will only accept an idea that is already protected by a utility patent.
g. Escalade
Escalade is another company that accepts ideas from the public. Escalade encourages inventors take precautions to protect their ideas prior to submitting them. The best way to get patent protection is to do so. The submission form requires you to include information about the product’s markets, patent links, media and descriptions.
h. Allstar Innovations
Ideas are welcome for more than 20 Allstar Innovations product categories. There are many categories that include home improvement, personal care and storage solutions. You will be guided through the submission process from selecting the product category to providing information about the product.
i. Play with a purpose
Play with a purpose is a toy company that allows you to send ideas via the “Contact Us” section of their website. You must choose the correct category from the dropdown list.
RELATED: Validating the idea: Is there a market?
j. Unilever
Unilever’s idea submission process is very clever. The company does not allow anyone to submit an idea. Instead, they give a list with specific challenges that your product must address. These include climate action, protecting and regenerating nature, positive nutrition and future work.
k. Mustang Survival
The company sells survival equipment and gear, as the name suggests. Mustang Survival welcomes new ideas, but prefers patentable inventions. A separate disclosure form is required for non-patent products. A drawing or photograph may be included in the proposal.
Related: 5 Tips to Turn Your Idea into a New Product Design with Prototype CAD Services
l. Coca-Cola Company
The Coca-Cola Company’s submission page has very little detail, except for general considerations regarding confidentiality and patent number reference (if any). The review process and product categories are not mentioned by the company.
m. Hershey’s
Hershey’s submission process for invention ideas is more flexible than other companies in terms of product category. You can submit not only your product idea, but also packaging or advertising ideas. Even new flavors and recipes can be offered for products already in production.
n. 3M
Many people think that 3M pays for product ideas. However, the terms and conditions of the submission form clearly state the opposite. Make sure that you have a patent before you submit your idea to 3M.
o. Hyde Tools
Hyde Tools has a large number of handyman products and it makes sense to search from all over the world for new ideas. This idea submission form works in the same way as Allstar Innovations’ multistep verification process.