idea a business

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A DTI SERVICE

My idea: is it a business?

UK Intellectual Property Ofce is an operating name of the Patent Ofce


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All information contained in this document was correct at the time of going to print, and is available in alternative formats

on request. For further information please visit our website at:- www.ipo.gov.uk or contact us on:- 08459 500 505


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This booklet gives basic guidance on how to legally protect your idea,and develop it into a reality. It aims to give you an overview of the issues

you need to be aware of in turning your idea into a successful business.If you need more detailed advice from experts, the guide directs youto appropriate professional organisations. Youll also nd a couple of

examples of successful ideas which have been developed into businesses.

Introduction


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Research 3What is intellectual property (IP) 3Choosing a business strategy 5Working with other people and organisations 6Condentiality 6Keeping hold of your idea (enforcement) 7Making sure your idea is original 8Develop your idea 9Assessing potential markets 0Identifying your competitors Planning your project Funding your business 3Attracting partners 4Govenment support 5Checklist 6

Case study (FireAngel) 7Case study (Solio) 8

Contents


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Researching your idea is vital. Be realistic about thefollowing six questions.

Does your idea work?

Is there a market?

What will it cost to produce?

What will people pay for it?

Canitreallymakeaprot?

Can you market it, and do you have the energyand resources to do so (or can you get them)?

What is intellectual property (IP)? Patents If youve created a new invention, it could

be a good idea to apply for a patent. This gives youthe authority to control how the invention is made,used or sold.

Copyright This can be an important source ofincome for your business as you may be able tocharge every time someone plays your jingle on theradio, uses your software, transfers your manual

to the internet, makes copies of your song lyrics orreprints your magazine article. You can also usecopyright to stop competitors copying your labels andliterature.

Designs These are important assets as they canbe a valuable selling point and part of your businessbranding, separating you from your competitors.

Trademarks These can be one of the mostpowerful marketing tools you have, as they helpcustomers recognise your company. Registeringa trademark allows you to protect the goods andservices which carry it, and gives you an IP assetto stop other people or organisations from copyingthem.

Know-how You should keep secret any informationor knowledge you have that is not obvious from theproducts or processes you are going to sell. Thiswill help you keep ahead of your competitors andimprove any IP you want to license.

Research

If youve created a newinvention, it could be a goodidea to apply for a patent.This gives you the authorityto control how the invention ismade, used or sold.


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Getting an existing manufacturer to make your product orprovide your service can allow you to concentrate on otherthings like promoting and selling it.

J oint ventures allow you to bring together the resources of

two or more different business to develop a shared project.Usually, one business provides the idea and the otherprovides expertise or funding. Setting a Vision for Growth(www.businesslink.gov.uk) by Business Link provides moreinformation. Most joint venture agreements should includea licence agreement to set out how to transfer technology.

In a collaboration, you team up with a business oruniversity. This allows you to share the costs and thework, but it may also mean youll have to split the prots.

For more information, read the Business Link guide J oint

Ventures and Partnering (www.businesslink.gov.uk) onhow to work with UK universities and colleges, or speak to

your local Business Link adviser (www.busineslink.gov.uk/bdotg/action.directory?r.s=h). There are also some grantsavailable to encourage businesses and universities to worktogether.

Spin-out companies

A spin-out company is an independent company createdto make best use of IP rights which have been licensed.These companies are often used in universities, wherethe original researchers need to be involved for the spin-out to be successful in the future. Because the businessrelationship is at arms length, it allows the spin-outcompany to focus on a single idea and secure funding orgovernment grants(www.patent.gov.uk/about/notices/00/manip/sec04.pdf).

Choosing a business strategy

You may choose to start some sort of business to make best use of your idea, rather than license or sell it.

Startingyourownbusinessislikelytobeexpensive,butallprotsandsuccesswillbelongtoyou.Youmaybe

able to attract funding, but to do this you will need a business plan. The Starting Up section of the BusinessLink website (www.businesslink.gov.uk, or www.bgateway.com in Scotland) provides guidance for those peoplewho are considering setting up their own business.

It is also worth remembering that even if you do not start your own business, you should still be prepared to domost of the work to show why your idea can make a good business.

Getting an existing manufacturer to make your productor provide your service can allow you to concentrate onother things like promoting and selling it.


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Selling your rights

Selling some or all of your rights will give you a one-off

payment but not a long-term income. Once you have soldyour ownership, the new owner can stop you using the IPunless you agree a licence with them that allows you tocontinue using it.

Licensing

Because you hold the IP rights, a licence will give you anincome without you having to put time and resources intoproducing the product yourself. A licence arrangementcan pay you either a xed amount or royalty payments

whenever your idea is used. Often, the licensee (the

company you license your rights to) will have betterknowledge of and access to markets, which will moreeffectively make best use of the IP.

You can license the rights to one company or many, andthis will affect how much money you can make. Butremember, doing the work to show that your businessidea works is highly important. Licences can be limited ingeographically or in time or how the rights are licensed. Aclear written agreement between you and the licensee isvital to avoid you having disputes in the future.

The Licensing Executives Society Britain and Ireland(www.les-bi.org) is the society for professionals who areinterested in licensing IP rights and transferring technology.

The Institute of International Licensing Practitioners (www.iilp.net) can help you with licensing in the UK and abroad,and run a service to nd you an appropriate licensing

consultant.

Copyright collective licences

Many copyright owners nd it difcult to manage their

rights on their own, and so have formed collectivemanagement organisations to represent them and managetheir rights for them. There are many collecting societiesavailable who will manage and license the copyright on

your behalf (see www.intellectual-property.gov.uk/faq/copyright/copyowners.htm).

There are a range of business strategies for artists andother copyright owners to increase prot as much as

possible. You could aim your product or service at themass market or only make a limited edition. The copyrightowners organisations may be able to provide moreadvice (www.intellectual-property.gov.uk/faq/copyright/copyowners.htm).

Public-lending rights (PLR)

The PLR scheme gives payments from government fundsto authors, to allow public libraries in the United Kingdomto lend their books for free (www.plr.uk.com).

Managing your IP rights

J ust like physical property, it is up to you how you manage your IP rights. Selling or licensing your rights mayappeal to you, but no-one wants to buy a business that wont make money. Your research on the market, costsand competitors will be vital to show someone why they should buy or license your idea.

Selling some or all of your rights will give you aone-off payment but not a long-term income.


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Building a team is important, and youll almost denitely

need to nd people to help you along the way, because

they bring skills you dont have. Its important to work outwhat help you need, how much it will cost and what youcan pay. A good team around you will often make thedifference between a business succeeding and failing.

Being a small inventor can be a lonely business, andmaking a business from your ideas can be frustratingand sometimes painfully slow. Because of this, it can beuseful to contact other inventors to share ideas, advice andopinions. There are a number of online forums that allowusers to swap ideas and information, such as IPR Talk(www.iprtalk.co.uk), Make Sparks Fly (www.internetprnews.com/colloquix//index) or the ideas network(www.ideas.co.uk).

You can get more advice on all areas of inventing at theInstitute of Patentees and Inventors (www.invent.org.uk).In Scotland, ICASS (www.icass.co.uk) provides specialist

advice and support for Scotlands inventors.

Invention promoters are rms who offer help to inventors.

Some people use their services to assess, developand market ideas. Invention promoters can be veryexpensive. If you are interested in working with one, werecommend that you do some research before enteringinto a contract. This may help you to avoid costly mistakes.For information on dealing with these companies, pleaseread our guidance Step-by-Step Guide to using InventionPromoters (www.patent.gov.uk/patent/howtoapply/ipromoters) or contact the Institute of International

licensing Practitioners (www.iilp.net).

Technology brokers

There are lots of services available on the internet thathelp bring inventors and business people together. Thefollowing website addresses are links to some not-for-prot brokering services. We do not support any of the

individuals or companies using these services.

Globalwatchonline.comWales4innovation.com

Working with other people and organisations

Condentiality

Itishighlyimportantthatyouconsidercondentialitybeforeyouspeaktoanyone.Ifyoudotellpeopleaboutyour idea, you may not then be able to patent your invention at a later time. Because of this, sharing new ideasforabusinessneedsalotoftrust,andcondentialdisclosureagreementscanhelp(seewww.patent.gov.uk/

patent/howtoapply/cda).

Franchising

If you want your business to grow quickly but you donthave the cash to make this happen, franchising mightbe one way to grow. However, you will have to share theprots and lose some control over how your idea is sold.

The British Franchise Association may be able to help(www.british-franchise.org).

Building a team is important, and youll almost denitely need to nd

people to help you along the way, because they bring skills you donthave.


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Why enforce IP rights?

The main aim of protecting IP rights is to allow the ownerto benet from their inventions. As a result, enforcing IP

rights is vital to:

make sure IP rights continue to be legally valid;

prevent other organisations from damaging the IP,including affecting your goodwill or reputation; and

help you get compensation for any damage (for

example, loss of prot).

Who will enforce my rights?

It is up to you to identify whether someone has copiedyour IP and decide what measures you should then take.In most cases, you can begin civil proceedings, but ifsomeone has illegally copied your product or service, youmay be able to begin criminal proceedings.

For more information on how to enforce your IP rights, seeour booklet on enforcement.

Before taking action in court, you may want to ask ourSearch and Advisory Service for a validity search or theiropinion (see www.patent.gov.uk/patent/sas).

Insurance

You can get insurance to cover legal costs if you need totake someone to court for damaging your IP. However,make sure your policy gives you enough cover. Also, theearlier you take out a policy, the cheaper it is likely to be.Insurance underwriters may not be prepared to cover the

risk if you delay taking out insurance until your product hasalready been affected.

If you feel that insurance would be a good idea, discuss itwith a professional adviser, such as a patent attorney orsolicitor. Remember that if youre approaching insurers,you may need to get them to sign a condentiality

agreement to make sure they dont publicise yourinvention.

Getting hold of and keeping IP rights is meaningless if those rights cannot be enforced in the marketplace. So,you need to consider what you would do at the start if someone copies your idea.

Keeping hold of your idea (enforcement)

It is up to you to identify whether someone has copied yourIP and decide what measures you should then take.


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The commercial potential of your idea is likely to be limitedif it isnt original. You should carry out searches to assesswhether there are any patents or other forms of IP thatcover your idea. There may already be rights coveringthe invention itself, which means that all or part of youridea is not original. There may also be patents or otherpublications that were in place before your idea, in whichcase you will not be able to get patent protection.Protect your intellectual property

Once you have found out that your idea is original,you need to consider how you will protect it. IP law iscomplicated, and so getting legal or other professionaladvice might often be the best way to work out how toprotect your IP rights and benet from them.

The Chartered Institute of Patent Attorneys (www.cipa.org.uk) or the Institute of Trade Mark Attorneys (www.itma.org.uk) may be the best people to approach about registeringyour IP rights. CIPA runs clinics (www.cipa.org.uk/pages/adviceclinics) which give free basic advice to inventorsat the early stages of developing an idea. For copyright,lawyers or trade associations (or both) may be helpful.

There are also other, more general sources of advice andhelp that might be worth exploring.

Business Link www.businesslink.gov.uk

Small Business Service www.sbs.gov.uk

Innovation Relay Centres www.irc.cordis.lu

Patent Librarieswww.bl.uk/collections/patents/patentsnetork.html

Making sure your idea is original

IfyouaretomakebestuseofyourIPassets,youmustrsttakeafewstepstosetupyourinvention.Remember,

you need to have non-disclosure agreements in place until you have sorted out applications for protecting yourIP.

For more information on carrying out these searches,

read the section on originality in the InventorsHandbook by NESTA(www.nesta.org.uk/howtoapply/inventorshandbook/ ).You can search trademarks(www.patent.gov.uk/tm/dbase)and designs (www.patent.gov.uk/design/dbase) onour website. The British Library runs a free servicefor searching for patents, and has a wide range ofresources online (www.bl.uk/services/document/patent.html).For a full search, youll generally need to pay for experthelp. Patent and trademark attorneys specialise in this

area (see the section on legal help for their contactdetails) and our Search and Advisory Service providescommercial searches for patents (www.patent.gov.uk/patent/sas) and trademarks (www.patent.gov.uk/tm/sas).

Once you have found out that your idea is original, you need toconsider how you will protect it.


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Also, see the sections on funding and government support.

Getting the right design can be vital to your businessssuccess. Building a prototype (a rst version of the

product) or developing a design can improve your chanceof becoming a successful business (see www.mas.dti.gov.uk).

A working prototype can help you check that the ideaactually works in practice, can expose any problems youdidnt see beforehand and can help you to decide on how

the product will look. It can also be useful in discussionswith potential partners or investors.

If you want to produce a working prototype of yourinvention, youll probably need to work with a manufactureror a specialised prototyping centre. A university orincubation centre could also help (see the section onsupport networks).

Local libraries have trade directories, which give lists ofmanufacturers and service providers. Remember, youmay need to keep your idea condential and so need to

get a condentiality agreement. You may want to get legaladvice before you make an agreement.

Making sure your product is safe

By law, many products have to be tested independently tomake sure they are safe. Using a testing centre approvedby the United Kingdom Accreditation Service (www.ukas.com) will make sure that the testing is carried outcompetently and that the results will be accepted abroad.

Develop your idea

Find a local contacts directory on the Business Linkwebsite (www.businesslink.gov.uk)or the local enterprise agency in the National Federationof Enterprise Agencies (www.nfea.com), or try your localChamber of Commerce (www.chamberonline.co.uk).

You may also be able to get help from one of the

business innovation centres in the UK (www.ebn.be).Innovation relay centres match businesses which havesimilar technology needs or interests (www.irc.cordis.lu).

The following regional administrations may also be ableto help.

Regional Development Agencies www.dti.gov.uk/rda/info

Scottish Enterprise www.scottish-enterprise.com

Welsh Assemblynew.wales.gov.uk/topics/businessandeconomy

Invest Northern Ireland www.nfea.com

Once you have developed your new idea into a workable product or service, there are a range of resources thatcan help you look into the options. These resources can help you assess the commercial potential of your idea,drawupabusinessplanandndsourcesofpossiblefunding.

For more information on your legal responsibilities andguidance on safety issues, see the Managing Health,Safety and Environment area of the Business Link website

Building a prototype (a rst version of the product) or developing a

design can improve your chance of becoming a successful business.


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Ask yourself the following questions.

Does it meet or create a need in the market?

Can you identify potential customers?

Will the product or service outlive passing trends inthe market or make the most of the trend before it diesaway?

Is the product or service unique, different or better tothose offered by competitors?

What competition will it face locally, nationally andworldwide?

Is the product safe and does it keep to relevantregulations? You should get legal advice before you goahead.

To answer many of these questions, you may want to carryout some market research as this could well increase yourchance of success the Business Link website provides aguide (www.businesslink.gov.uk).

You could hire a market research agency you can searchfor one on the Research Buyers Guide website(www.rbg.org.uk).

The Chartered Institute of Marketing has a guide to marketresearch on their website (www.cim.co.uk/cim/ser/html/cover) and The British Market Research Association hasresearch techniques on its website(www.bmra.org.uk/researchers-toolkit/index).

Pricing your service or product

You must set out a pricing strategy for a new product orservice the moment you decide to take an idea forward, asit will help you nd out how much you can afford to invest

in the project.

You can nd a full guide to pricing your product or service

on the sales and marketing section of the Business Linkwebsite (www.businesslink.gov.uk). Make sure youreally know what your costs are for making the product orrunning the business.

Selling

A thorough sales strategy is vital if your product or serviceis to be successful. It should focus on:

ways of selling that can be stoppedor changed if necessary; and

how much it costs for each sale.

Today there are many outlets through which you can sellyour goods or services for example, websites, mail order,

direct mail and small ads, each of which have differentstrengths. The Business Link website (www.businesslink.gov.uk) has a detailed guide.

Assessing potential markets

Beforemakinglargeinvestmentsinyournewproductorservice,itsagoodideatoassesshowitwilltintothe

marketplaceandmostimportantlywhetheryouwillbeabletobuildaprotablebusinessaroundit.

Before making large investments in your new productor service, its a good idea to assess how it will t into

the marketplace and most importantly whether youwill be able to build a protable business around it.


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To identify your competitors, dont just research whatsalready out there. You also need to be constantly lookingout for possible new competition. You may want to considerselling or looking to license their IP before somebody elsetakes it up.

Understanding your competitors

The best way to understand your competitors is to monitorthe way they do business. Information on the internet cangive you good tips on what businesses are doing. Findout who aims at your market and how they go about it, for

example:

what they provide and how they market, distribute anddeliver it;

their brand, design values and prices;

how they keep their customers loyal to their product;

whether they use new products or business methods;

how many staff they have and the quality of staff theyattract;

whether they have a website or e-mail address;

who owns the business and what sort of person theyare; and

what is in the annual report (if theyre a publiccompany) or their accounts at Companies House(www.companieshouse.gov.uk)or the Northern Ireland Companies Registry(www.detini.gov.uk) if theyre a limited company).

It may be useful to go to exhibitions and trade fairs tocheck which of your competitors have displays. Upcomingevents are listed on the Business Link website (www.businesslink.gov.uk/bdotg/action/event).Use main libraries to study trade publications and businessmagazines.

You can access information about UK trade associationsand business sectors from the Trade Association Forum(www.taforum.org). You could also speak to your localChamber of Commerce (www.chamberonline.co.uk).Business reference libraries can supply directories and

survey reports.

Staying ahead in the market

Once you are up and running, like all businesses you needto keep improving your idea to plan for and respond to thechanging needs of your customers. This means investingtime and money into market research and developing youridea.

The Business Link Research, Design and Developmentguide (www.businesslink.gov.uk) explains why developingyour idea is vital to staying competitive. You can nd

out how new and original your business is on the

Living Innovation website (www.innovation.gov.uk/self_assessment).The Manufacturing Advisory Service (www.mas.dti.gov.uk)also has a fact sheet about management techniques.

Identifying your competitors

There is always competition between businesses. But it is not just another business that might attract yourcustomers, it could be a new product or service.

The best way to understand your competitors is to monitor theway they do business. Information on the internet can give you

good tips on what businesses are doing


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Business Plan Services specialise in helping with businessplanning (www.bizplans.co.uk) but you can also look atsample plans on the bplans.org.uk website or templates onMicrosoft Ofce (www.ofce.microsoft.com ).

Developing your business acumen

If your project is to be successful, you need to developyour business acumen. This means:

having a good understanding of how your idea canmake you money;

having a thorough understanding of what increasesprots;

focusing on the market; and

having a big picture of the business and itsenvironment.

Starting Up on the Business Link website (www.businesslink.gov.uk, orwww.bgateway.comin Scotland)gives guidance on how to go about starting your own

business. It includes tools to assess your qualities as abusinessperson, your business skills, your knowledge ofmarket-research techniques and your nancial commitment

to help you decide whether you are ready to get going.

Being clear on these issues is particularly important ifyoure looking for nance or investment. The process of

building your plan will also focus your mind on how yournew business will need to work to have the best chance ofsuccess.

Managing the development

Carefully managing your project is vital in making sure youcan successfully develop new products or services. Youwill need to:

control costs and set aside resources;

develop your product;

work out whos in charge, who does what and when; and

sort out any problems.

You should set deadlines for when you will completeimportant tasks, but your plan must allow for problems thatmay arise which could change the project or your business.

You may want to consider hiring a professional projectmanager, for example, through the Association of ProjectManagers (www.apm.org.uk).

The Association of Project Management Group have awebsite (www.apmg-icp.com) which allows membersto share ideas. The Ofce of Government Commerces

website has details on managing projects (www.ogc.gov.uk/prince).

Planning your project

Onceyouhaveidentiedyournewproductorservice,youmustthenplanhowyouaregoingtogetittothe

marketandgoaboutturningitintoaprotablebusiness.

Business Plan Services specialise in helping withbusiness planning


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Use your own money to set up your business

If youre starting a new business, its likely that youll haveto put up some of the money yourself. Financing yourbusiness yourself gives you far more control than othertypes of funding, but you must be aware of the risks. Ifyour business fails, you could lose your home and otherpersonal belongings.

Borrowing from friends and family

Friends and family may be willing to help by lending money

or by buying a share of your company. But remember, youcould risk losing their money as well as your own.You should give possible investors an up-to-date businessplan, and have an agreement that sets out terms andconditions deadlines (such as for paying interest andrepayments). You and your family may also need to paymore tax (for example, on interest-bearing loans).Using bank loans to start your business.

Before lending you money, your bank will want to know thatyou are a good risk new companies can nd this difcult

to show, because they do not have a track record to drawon.

Usually, the bank will want you to:

present a realistic business plan;

provide evidence that you have a successful trackrecord in business;

offer security for any money it lends you; and

invest some money in the business yourself.

If you dont meet all the banks normal conditions, you mayqualify for a loan under the Governments Small FirmsLoan Guarantee scheme (www.businesslink.gov.uk, orwww.bgateway.comin Scotland).

Funding your business

There are many ways to fund your growing business. Its a good idea to get professional advice before lookingfor sources of funding (see www.businesslink.gov.uk, or www.bgateway.com in Scotland).

Friends and family may be willing to help by lending money or by buying a share of yourcompany. But remember, you could risk losing their money as well as your own.


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Business angels are individuals who invest on their own,or as part of a group of investors, in businesses which tendto grow quickly. As well as money usually up to 50,000 business angels often make their own skills, experienceand contacts available to the company they invest in. TheBritish Business Angels Association (www.bbaa.org.uk)can give you more information.

Venture capitalists usually invest anything from 500,000to million or more. They choose businesses theybelieve will give a high return on their investment andprojects with clear exit times. The British Venture Capitalist

Association (www.bvca.co.uk) represents over 80 UK-based private-equity and venture-capital rms.

Before approaching potential investors, you need a goodbusiness plan, along with evidence of your ability tomanage a business. Your plan should include detailednancial forecasts and explain what you will do with funds

which are invested in the business. You will also need toprepare a pitch (a presentation to help sell your businessto potential investors).

Grants

In the UK, there are many types of grants available forexample, from the Grants for Research and DevelopmentScheme (which is run by the Research DevelopmentAgencies (www.dti.gov.uk/rda/info)and the Small Firms Loan Guarantee(www.businesslink.gov.uk).In Europe, there is the Framework Programme (cordis.europa.eu/fp6)and EUREKA (www.eureka.be/thematicaboutStrategicInitiatives.do).They are good sources of cheap nancing and may also

provide expert advice and information.

To qualify for a grant, your business must meet theconditions set by the scheme. If accepted, you will have touse the funds for a specic project and the grant will only

cover a percentage of your costs. There is often strongcompetition for the schemes and the application processcan be complicated and take a long time.

The Business Link website(www.businesslink.gov.uk)outlines all the types of grants which are available.

Attracting partners

Outside funding can suit opportunities for long-term investment. Usually, your company gives investors part-ownership inreturn for their investment. As a result, the investors will share in the prots of your business.

Business angels are individuals who invest on their own, or as partof a group of investors, in businesses which tend to grow quickly.


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Creative industries have a range of business options, andthe DCMS website includes information on how to getfunding (see www.culture.gov.uk/creative_industries/).

Research councils (www.rcuk.ac.uk) fund academicresearch and training. They aim to turn academic orbusiness ideas into money-making processes andproducts. Each research council has its own procedure forawarding research and development (R&D) grants.

The Small Business Research Initiative is designed tomake it easier for smaller rms to get contracts from

government organisations to carry out research anddevelopment (see www.sbri.org.uk).

Knowledge Transfer Partnerships run throughout the UKand aim to bring graduate researchers into businesses(see www.ktponline.org.uk).

Knowledge Transfer Networks offer grants which aredesigned to create networks between businesses,academic institutions and trade associations. You can nd

more information on the DTI website atwww.dti.gov.uk/innovation.

Collaborative research and development grants encouragebusinesses to team up and consult with the researchcommunity. The level of grant support will vary between25% and 75% of both partners R&D costs. You can nd

more information on the DTI website(www.dti.gov.uk/innovation).

The Shell Technology Enterprise Programme (STEP)is a scheme designed to help small or medium-sizedbusinesses or community organisations. The businesspays a student a weekly training allowance for the length ofthe project. In return, the business receives support from a

local STEP manager (see www.step.org.uk).

LINK collaborative research encourages the industryand academics to work together on research projects.All LINK projects must involve at least one company andone research-based organisation. Large and small UKcompanies and even multinational companies can takepart (www.ost.gov.uk/link/).

Tax relief and allowances for research anddevelopment

Businesses that carry out research and development canoften reduce their tax bills by claiming relief. For moreinformation, see the HM Revenue & Customs website(www.hmrc.gov.uk/randd).

Government support

Thereareanumberofgovernmentprogrammeswhichcanoffersupport,anditcanbeworthndingoutifthey

offer help for your type of business. There are also a range of grants available to SMEs (see www.grantnet.com).

Businesses that carry out research and developmentcan often reduce their tax bills by claiming relief.


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Checklist

Check that the idea is new.

Assesswhereyouwilltinthemarket.

Choose your target customers. Know your customers needs, identify the types of customers and how to sell to them.

Set out your costs and nd out what customers will pay.

Identify competitors.

Protect your idea with appropriate IP and think about enforcement.

Prove the idea works.

Research and develop your business, new products and services.

Get the design right, test it and develop prototypes.

Get the professional help you need, for example:

Business advisors, solicitors, accountants, and patent and trademark attorneys.

Sort out a business plan.

How do I survive until my business is off the ground? Predict and plan your sales.

Plan your marketing strategy, and identify potential sales methods.

Do market research and get market reports.

Choose and protect your business name, and create a brand.

Use your business plan to get funding, for example.

Investors (equity), business partners, grants or venture capitalists.

Consider your business options.

For example, licensing, manufacturing, joint venture, franchising,subcontracting and so on.

Starting a business.

Budget and plan your business.

Plan your cashow and how to get paid on time.

Examine your nance options, both to start off with and if you run out.

Decide whether to lease or buy assets.

Choose the legal structure for your business.

Choose and run a business bank account.

Sort out your tax and record-keeping.

Assess whether you are responsible for paying National Insurance, business rates,VAT, and other business taxes, reliefs and allowances.

Assess risks and your responsibilities for health, safety, security and the environment.

Insure your business and its assets and get liability insurance.

Set up your premises and negotiate with suppliers.

Running the business. Pricing the product or service.

Marketing your product or service and staying ahead in the market.

Control your business costs and stock.

Consider whether to sell direct, how you will distribute your products, and setting upand promoting your business online.

Get the most from IT in your business for example, through e-marketing,

e-commerce, and accepting online payments.

Keeping to the law.

For example, the Sale of Goods Act, Data Protection, fair trading, trade descriptionsand trading standards, product liability, the Information Commissioners regulations.

Review the regulations that affect your business, investigate and apply for the licencesand permits.


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FireAngel decided to go it alone.

They initially received a 55,000 European grant but theproduct developed some problems in the rst year and

the grant was soon used up. They then received another50,000 through a group of business angels and, byconcentrating mainly on developing and marketing theirproduct, they saved money. Within months, theirproduct was independently tested to the relevant BritishStandards and available to buy in the UK.

Fire Angel eventually won a contract with B&Q for threemonths, which was followed by a two-year merchandisingagreement. Other national retailers also become involvedand, within months, the FireAngel PS-0

Plug-In Smoke Alarm was available in over 3000 shopsacross the UK.

FireAngel

Within four years, FireAngel had won a number ofawards including the Real Business/CBI New Product ofthe Year. In 00, Sprue Aegis became a public limitedcompany with a turnover (for the three months up to J une003) of 55,000 a 46% increase on the same threemonths in 00. FireAngel have extended their productsinternationally, to 8 patents (either granted or in progress),plus protection for a range of trademarks. A new name AngelEye has been registered specically for the

American smoke-alarm market.

Sprue Aegis plc will continue to invest heavily in developingnew products for both the FireAngel and AngelEye brands.The companys attitude is that they can only progresscompetitively if they continue to develop original products,

meaning that new patents are expected in the years tocome.

The FireAngel PS-0 Plug-In Smoke Alarm wasavailable in over 3000 shops across the UK.


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Chris and his team at Solio knew that, in the growingmobile-phone industry, battery and energy technology puthuge limits on the product. Phones were adding featuressuch as TVs and radios, but they drained the batteryquickly. Chris saw huge advantages in using solar energy its environmentally-friendly, convenient and free!Research showed that solar chargers already on themarket didnt work well, and were poorly designed andmarketed. Better Energy Systems (BES) wanted todevelop a brand that was a must-have. To get a uniquedesign, Chris appointed a designer called David Fowler.

Chris then approached a US solar-energy manufacturer,who were making a similar product, but had no

patent. Chris wanted to learn from them, as he had nomanufacturing experience and hoped to share the costs.The discussions were successful and Chris signed a

Solio

development agreement, allowing the manufacturer to own50% of the solar technology. Once BES had developedtheir actual design for Solio plug into the sun, they couldthen register their design with the UK Patent Ofce.

BES also approached engineering rms in Germany

to run tests on the battery life and the toxic parts of theequipment. They also worked with Motorola, Orange,Appleand Vodafone. These links gave Chris access toexpertise that he did not have. However, every discussionmeant that more people were learning about his new ideas.Chris used non-disclosure agreements and contractorsagreements to make sure that anything created throughSolio was still BES property. As Chris said: When anyoneis starting to develop a new product, who you talk to about

it is key... you dont just disclose to everybody what you aredoing. If you do disclose, make sure you have a watertightcondentiality agreement.

Chris and his team at Solio knew that, in the growing mobile-phoneindustry, battery and energy technology put huge limits on the product.


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