Before you can began rolling on the fast track with your new business, it takes planning. Don’t skip any of the original 10 step business plan we’ve listed below. Some things are absolute necessities in advance of your opening date for business.

Let’s make it easy and simple. Listed below is a 10 step plan you need to undertake well in advance of your new business opening date. This is only the beginning list but you’ll discover and add more in coming days and weeks.

Your own business expertise and experiences will obviously come into play as you work on your complete business plan. For now, let’s get underway and begin to work through the following list of important business decisions…

1. Decide on Service and/or Product you plan to market/sell.

2. Select Accounting Firm or CPA if required

3. Hire Competent LEGAL COUNSEL

4. LOCATION is an important key to your success

5. Know your FINANCES, Money Source, before making any investments

6. Determine Employee Requirements – background; education; professional; etc.

7. Recruit a Mastermind Team

8. Is a new building required before you can open for business?

9. What licenses are required, certifications, etc.?

10. What is your opening Date for business?

Shooting from the “hip” or without a plan is a disaster waiting to happen. Even the smartest entrepreneurs are NOT willing to take such risks. Are you going “solo” or is this a franchise with a long-term history of success? 90% Vs 10% success rates may give you a reason to make the investment for a franchised business.

Weigh the odds. Research the history, do your due diligence. Don’t let anyone rush you into making a decision because someone else wants the same territory and is waiting with money in hand, ready to roll and cut you off at the pass. Don’t believe it without proof and then only if you are sure this is your choice.

Everyone dreams of owning their own business. Making BIG dollars, driving fine cars with all the goodies, BIG houses in beautiful places to vacation at will, club memberships at the finest golf courses, places for fine dining and meeting the upper crust of society.

Where’s the problem? For most of us, it takes 25 to 30 years of hard work without any guarantees that we’ll ever reach the pinnacle of success. Far too many businesses bite the dust than hit the big time. Taxes, employees, thieves, bankrupt customers are the main culprits of business disasters.

Not a pretty picture but awareness is extremely important. The more YOU know what can happen the better prepared you’ll be. Watch out for any employee with too much “power” in your business who likes to take charge.

Many services you need to run your business are better outsourced than handled internally. Hire reputable people in all areas whether in house or outsourced. Pride yourself on building a company with competent staff, well paid, good benefits simply because it’s your key to a successful business long-term.

Overview

An effective Invention Business Plan is an inventor’s best tool for efficiently navigating through the invention process. As an experienced inventor, I’ve learned that an idea is not perceived as a viable business opportunity until it can be effectively communicated on paper (or any other readable format). No matter how great your idea is, most people expect that you have it written down. When I was new to inventing, I had no idea what that meant. I searched around but didn’t find any universal format for documenting my ideas.

When submitting my concepts to invention hunts, licensing agents, manufacturers, retailers, engineers, and the patent office, I was asked many different kinds of questions. The questions ranged from “What problem does it solve?” to questions that required extensive research such as “Who is your target market?”

Fortunately, with my entrepreneurial background and experience writing business proposals, I was very familiar with answering such questions. Therefore, to save time, I decided to consolidate all of these questions into a universal format that could be used and/or adapted for any audience within the invention process.

In this article, I discuss how to develop a versatile yet compelling business plan for inventors and their inventions. I explain its importance, main elements, how and where to find content, and its many uses. I also provide real examples adapted for three common purposes: for filing a provisional patent, for entering into an invention hunt, and for submitting to other key users. Other key users may include retailers, manufacturers, industrial engineers, investors and licensing agents. By sharing my insights and examples, I hope to help inventors like you develop your own material in order to effectively communicate and present your invention to the many different users within the invention process.

The Importance

An Invention Business Plan is an effective communication tool for providing a clear and tangible description of your invention while conveying its viability and value. It tells a detailed story about your invention including what it is, how it works and why your invention is a believable business opportunity. It can generally be described as an organized all-in-one depository of everything you know or have learned about your invention. It includes every angle about your invention so as to be used as a reference point for the development and/or submission of audience specific requests. Having a broad audience scope allows it to be used as a collection of information which can then be modified or adjusted according to the audience in which it serves.

Invention Business Plan Example: The Main Elements

Many different readers and audiences need to see your idea in writing. You will be surprised how many different questions will be asked about your invention. In order to efficiently answer such questions, the document should be designed such that it serves as a detailed yet practical guide and resource to be used by a broad audience. Thus, the elements and content of your plan should be both comprehensive (i.e. can answer most questions about your invention) and adaptable (i.e. can be easily modified) for the purpose of a specific use or audience. The recommended elements for a comprehensive and adaptable report are as follows:

• Short Description: A brief summary (1-3 sentences) of what your invention is (name), what it does, and how it is useful.
• Abstract: A general description of your invention, its market, and its benefits. Include the target market, how your invention solves a problem, or how it is useful to your market.
• Fit: How does your invention fit into an existing retailer or manufacturer’s product mix? How is it innovative compared to their products? What is the best aisle to place your product? If possible, include a photo of the aisle and exact location on a shelf. List key selling and consumer advantages in a bulleted format. For example, key selling advantages may include up sell potential, a shelf attention getter, innovative disruptive qualities, and/or fills an underserved market niche. Consumer advantages may include simplicity, convenience of use, automates a manual task, saves time and steps, and/or solves an existing unmet need.
• Detailed Description: This is where you describe the main parts or components that make up your invention, how your invention works or what it does, its main features, and method or intention of use. An example of main parts may include a container with lid, a motor for spinning, etc.). Examples of main features may include dishwasher safe, automated functionality, ease of use, etc. And, method of use examples could be: step 1, press red button to turn on, or pull white knob to make it move.
• Suggested Retail Price: Base the suggested retail price on comparable market prices and other relative assumptions and factors. For example, if the invention combines the task of two or more existing products on the market, provide the cost of using those products separately and then demonstrate how your invention is priced such that it saves the consumer time and money. A good example is a food processor. You would provide the cost of knives, cutting boards, and the time it takes to cut everything. Whereas your invention, the food processor, is priced less than all of those things combined, plus you have the added value of convenience and time savings.
• Estimated Manufacturing Cost: The ideal situation is to contact manufacturers to get a price quote of how much it would cost to build your invention. But this can be difficult if you don’t have exact specifications. The other suggested general rule is to divide your Suggested Retail Price by a factor of 4. For example, if your suggested retail price is $80, then your Estimated Manufacturing Cost is $20.
• Problem/Challenge It Solves: Discuss the details about the problem or challenge your invention solves. Include market trends and actual facts taken from credible sources. Describe how your invention is better than existing products. What are the flaws or downfalls of existing products and how does your invention solve those problems? Using the food processor invention as an example, you would say now it takes 20 minutes to cut vegetables for dinner using traditional methods (knives and cutting board). The food processor would reduce that time to 2 minutes.
• What Makes It Innovative: How does your invention stand-out or how is it better than existing products or traditional methods? For example, the food processor saves users time, money, steps, and kitchen clutter in the food preparation process. Since there is no need to use multiple knives and cutting boards for cutting vegetables for dinner, you save cleanup time and counter space. Instead, consumers get a compact easy to use device with an automated motor for cutting vegetables to a desired size.
• Competition: List existing comparable products or alternative methods currently sold or used on the market. Explain how your invention has a competitive advantage over these existing alternatives.
• Market Position or Target Market: Who are the target users and/or target buyers? Who are the target retailers or manufacturers? What are the primary distribution channels (online, brick and mortar stores, both)? List examples.
• Packaging Suggestion: How do you want to package your product such that it grabs the attention of the target user/buyer? Will your product be included as part of a kit of other products, or will it be a stand-alone product? Will it be packaged in a box, a bag, with or without a label? What is your suggested package design and message? For inspiration, study package designs by other retailers or manufacturers.
• Product Extensions, Variations, and Add-On Suggestions: What other colors, designs, or styles can your invention have? Can there be multiple versions of your invention such as low-end and high-end versions? Can you add anything to your invention to make it even more useful? Do you want to provide a warranty for your invention?
• Intellectual Property: Provide a patent number or provisional patent number if you have one. List the date and how you came up with the invention. Use the United States Patent Office website to research other related prior art. List and describe those related prior art. List the history of the invention if any. You can find descriptions of the history on any of the prior art examples. List its primary components, provisional claims, and provide drawings or schematics of its design. Use prior art examples as your guide. You may decide to hire an industrial engineer, in which case, include those designs here.

How and Where to Find Content

While most of the content should be in your own words, the top five suggested content resources for finding inspiration and ideas as they relate to the above elements include:

• A related retailer or manufacturer’s 10-Q (Quarterly Statement) or 10-K (Annual Statement)– for Market Research, Problem/Challenge It Solves, Competition, and Target Users. 10-Q’s and 10-K’s can be found on the website of most public companies, or search for companies on the Security and Exchange Commission’s (SEC.gov) website.
• Related patents from the United States Patent and Trademark Office (USPTO.gov) – for Abstract, Detailed Description, Components, Features, Methods, Intellectual Property Research, Patent Results, and Drawings and Design.
• Trade association websites, magazines, and other trade materials – for Market Research, Competition, and Target Users. For example, a well-known trade association is the International Housewares Association (IHA).
• Websites of retailers or manufacturers – for Packaging Suggestion, Product Variations, Key Selling Advantages, Key Consumer Advantages, Suggested Retail Price, Manufacturing Cost (general rule: divide retail price by 4).

Usefulness and Audience

The invention process involves disclosing your invention to a wide variety of readers. As mentioned, such document is a starting point or template for providing future material with respect to the many different readers and audience for which you will need to communicate your invention.

For example, invention hunts, industrial designers or engineers, retailers, manufacturers, licensing agents, lawyers, marketing agencies, and the United States Patent Office.

With a well-documented plan, you can conveniently adapt or modify it depending on its primary use or audience thereby saving you time and steps. As a general rule however, be conservative about what you disclose. Only provide information that is requested or required. I also suggest including a non-disclosure agreement (even if a provisional patent is filed).

Conclusion

In summary, an Invention Business Plan is used for many reasons. It is an essential part of the invention process. It helps inventors effectively convey an idea into a tangible, understandable, and justifiable business opportunity. I wish you much success with your invention endeavors.

Did you know having your business plan fail can be the best thing that can happen to you? Sounds crazy right? But it’s true, and here is why.

Why Plans Fail

Business plans, marketing plans, heck any kind of plan is going to fail. Some just a little and others spectacularly. It’s not for lack of work or analysis. It’s because we can’t predict the unpredictable, and when we try we aren’t very accurate. Customers and markets are fickle. Something unexpected occurs. Or we just screw up and it all wrong.

I’m sure New Coke looked great on paper. Anybody remember the Apple Lisa or the Cube?

Plan to Fail?

So if plans are going to fail, why bother with them at all? But a better approach is to don’t sweat getting your plan right the first time out since chances are it is going to fail anyway. Its more important to understand this and think about your plan B. And remember, this isn’t just for business plan, it is for any kind of plan.

Plans are worthless, but planning is everything for success

Since we know change is going to happen and things are going go wrong, why are we got off guard all the time when they do?

The most successful people recognize this happens and are prepared to adjust. And not adjust by blindly taking another, different stab and things. They have planned ahead. They look to the market and find what is working with their plan. They run with the things they got right, They see what isn’t working and adjust.

Getting to Plan B

I started to think about this after I read an interview with John Mullins who wrote a book called Getting to Plan B. In it Mullins lays out some approaches you can use to see if and how your plan is failing and how to fix it.

Make no mistake. Unfortunately this isn’t a license to be lazy and count on working it all out later. Quite the opposite. You have to do more work, but it is smarter work that gets you through failures and has its rewards in the end.

They look at what others who have succeeded did or didn’t do. Same for those who failed. They find the lessons from failures. When they do that they are able to make better decisions. Then they just do it all over again until they get it right.

The lesson is that they are always planning. It’s like the idea of the one page business plan. You still have to put in all the prep time on it. No shortcuts. But the what makes this work is that you regularly review and update your plan. You don’t just toss it aside when you are done or scrap it if you hit some problem. Fix what isn’t working. Adjust to changes and any new or missed opportunities.

This really works

This is how software gets developed only they call it the iterative approach. You don’t write a program all at once. You work through it in cycles, getting more done each time. You fix the broken parts and add new features until you are all done. Then you sell it. Unless of course you’re Microsoft. MS sells and lets us find the broken parts, but that’s a different story.

I worked with a microbusiness that wanted to do consulting on importing/exporting industrial equipment. We found there wasn’t a market for their consulting services, but we did find out there was a big need for technical translation services. Okay, we rethought the business model and changed. I worked with another small company that did custom software development. They only wanted to do work on big projects, but they found out that they were making much more money doing body shop work–putting individuals into specific contracts as consultants instead of taking on big projects as a team. Time to change directions.