Stuart Price, head of the commercial team at Lodders Solicitors, explains how you can minimise risk and maximise returns in your new product development activities.
As a team of commercial solicitors, we love getting calls from clients (and potential clients), with a fantastic idea for a new product. In an ideal world, these calls come at the start of the product development journey, so we can be as proactive and effective with our legal advice. But, whatever stage you are at, experienced commercial solicitors will be able to help you understand how to best minimise your risks and maximise your returns.
If you are thinking about developing a new product, here are six questions to ask your solicitor.
1) What is the best corporate structure?
Launching an innovative new product has inherent risk, and a lack of customer demand is not the only potential issue. What if the product doesn’t work as planned, or there are unforeseen issues? To protect the company from reputation damage or product liability claims, it might be sensible to launch the product through a new division or by forming a subsidiary company. Talk to your solicitors about the best company structure for your new product.
2) How can I protect the IP in my new product?
It’s important to think about intellectual property right at the start of any new product development, from how you will protect your (hopefully!) valuable innovation and know-how, through to ensuring you are not infringing on anyone else’s IP rights. Your solicitors will be able to carry out searches for other similar IP rights as well as helping you to register your own rights.
3) How can I minimise the risks of any third-party collaborations?
To bring your new product to market, you may be thinking about collaborations with other companies or individuals. This will probably involve discussing know-how, trade secrets and confidential information – all of which need appropriate safeguards to stop them falling into the wrong hands. Ask your solicitors how to make sure your conversations with third parties are protected.
4) How can I manage my supply chain contracts?
Bringing a new product to market will involve contractual relationships with manufacturers, logistics, sales agents and distributors, retailers and so forth. Each of these relationships will have contractual implications and you want to make sure that the terms work for you. Talk to your solicitors for expert advice on the best terms for your product.
5) What is my best route to market?
While you wouldn’t turn to your solicitors for a marketing and business development strategy, you should however be involving them in conversations about your sales and distribution plans. Whether you are focusing on online sales or planning to engage sales agents or distributors, you need effective terms of engagement. Your solicitors will be able to advise you on areas such as exclusive versus non-exclusive distribution relationships and a host of tactical areas such as minimum sales levels, how to handle shipping costs and the management of returns/faulty products.
6) How do I manage my customer data?
Last but not least, if you are developing a product for the consumer market, you need to have data protection and UK GDPR rules in your sights. Ask your solicitors for expert advice on how to manage and protect the personal data you will collect on your customers, so you can provide them with the necessary confidence.
From distribution to data, and from structure to supply chains, seeking timely legal advice can help you to maximise your chances of successful new product development.
More information
If you require bespoke advice in relation to your specific project, our expert solicitors can assist you. For more information, or for an initial chat, please get in touch with Stuart Price using the form below.
Our answers should not be considered as formal legal advice as the background of any situation may affect the advice that we give.
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Stuart is a partner in Lodders’ Corporate and Commercial team. He is an expert in commercial law and regularly advises clients on commercial contracts (including technology and media contracts) intellectual property and data protection issues.
