Ah you have the wrong product in mind, but I think the answer is the same. I'm referring to the eotech 551 weapons sight. The chinese clones are called 551 graphics sights. But I haven't heard any complaint about the model number yet. The issue is about trade dress. I also have some of the items already, what should i do with them If I choose not to sell them? You are right I am just a small business, I sold other products and then realized there was a missing spot of sales in my hobby of airsoft, no one wants to use expensive sights because they will get hit by hard plastic pellets. I'm getting the feeling that I should get rid of these products because I don't want to have any legal complications. But as you seem to be implying they may not be illegal. I don't quite understand if they are or not. Just that I've got some and need to get rid of them.
Oh, and do you know what kind of licensing fee winchester charged? I don't want to do anything potentially illegitimate and would not mind paying If I could afford it and it was reasonable, I've heard licensing is typically 8-12% of sales price.
Yes, I do know since I was the one who set (negotiated) the fees, which have probably changed since I left. That was because many of the licensees started as infringers that I decided actually made quality stuff and should be allowed to continue under license as they would enhance the brand. When I was there, it was 5-25% of gross depending on whether the name was what sold the product or the product sold itself. I generally figured 25% of the expected net profit of the licensee on the item, and worked up or down from there depending on whether the Marketing Dept was eager or not eager to have a license issued. It is often very hard to estimate net profit in advance, but that was our goal at the time. However, it was always expressed as a percent of gross revenues so we did not have to rely on honesty of the licensee in reporting their net and could audit easier. There are also usually minimum fees, since it costs money to administer a license. For example the NFL might have a minimum of $100K or even $1M on a hot item. Minimums are always confidential so as to not jeopardize future deals. At the time we would not have licensed a scope since Winchester owned Weaver scopes. However, for something like you are describing, it would have been 10-15% if we did not have to do the marketing and 25% if we did. I would have done it under the Weaver brand unless it was Walmart, Cabellas, Bass Pro or some other big customer asking and then all bets were off and I would then let the Marketing team call the shots, within limits I set for them, so they could trade low license fees for larger ammunition orders or even exclusive positions on their store shelf. KMart, back when they were equivalent in sales to Walmart, got several zero fee licenses in return for dropping Federal & Remington and instead selling Winchester ammo exclusively. Of course, that doesn't apply to you. So I would suggest budgeting at 25% of estimated net profit and translate that to a % of gross sales to get a ballpark number, likely around 10%. Since it is just a model number, if you have a good negotiator, you get that lowered to around 5%. So, that is some free specifics that you need to realize are all negotiable.
Oh, and if Remington let eoScope do a Model 551, then Remington has indeed gone soft. Good chance neither will do much now, but the license lets you transfer the risk to someone else.
wow, those details fall in line with what i've learned from school. I'm a small business owner who decided to get into online retail to pay for a degree in business. I'm very happy to see that there may be a way for me to negotiate with them. And I will definitely try to do that. I wonder If they would just as well have their own people decide to market the product for airsoft. But I will have to see what I can do. Thank you for all your expertise and time it is quite enlightening.
Depends on how busy and how well staffed they are. My guess is they would prefer to concentrate on what they know and just charge licensing fees for this. Your problem is making it a big enough deal for them to even let you "pitch" to them. If you get an attorney, they will nearly always at least figure it is worth listening to the "pitch." Get your elevator speech ready!
good link, Ill have to see how this situation develops. I definitely see a benefit in a eotech style scope product for airsoft. Due to the popularity of such scopes with the fact that no one would want the original item on their rifle. In the game the normal toys cost about $150, using a $400 scope on them is unreasonable especially when It would be extremely easy to destroy the optics of the scope do to the airsoft projectiles, which are quite strong. It seems like it could popularize their scopes even more. As long as they were clearly differentiated from combat scopes so as to keep military and LEO safe. I read up on elevator speeches, had never heard that term before, that is somethign I'll have to work ob.
As to "pitching", here is a great video to watch:
emphasing that the most important thing in a pitch is YOU - your integrity, your passion, your experience, your knowledge, your skills, your leadership, your commitment, your vision, your realism and your ability to listen.