Fishing Equipment Business Plan Leave a comment

Seacliff Products (Seacliff), an innovative company, has created a patent-pending fishing hook. Seacliff developed an easy-to-use kit to sell until they found a business partner to license the product. Seacliff forecasts strong sales in year one, and a steady increase in year two.

Seacliff’s Supreme hook is an innovative live bait holder. According to tests, there is a noticeable increase in fish catch up. Having increased fish hookups allows the user to have greater enjoyment while fishing.

The Business Model

Seacliff will have a laser-focused approach to business. This allows them the freedom to be focused on their core competencies, while outsourcing those that are not of significant value. Seacliff is a design company, therefore they will concentrate on the design of useful products. They will search for a strategic partner, who can manage production, marketing and distribution. The outsourcing of non-essential activities will allow Seacliff to realize significant profits without the liabilities of marketing, manufacturing, and distribution. Seacliff will benefit from steady revenue streams without having to pay the capital costs of selling a product. Seacliff makes good profits, and the product is supported with a professional marketing team and an established distribution system. Seacliff is currently in search of a strategic partner. It expects to enter into negotiations with them soon.

Market

The Supreme hook is a popular choice for fishing. The total market is estimated at $300 million. The U.S.A has more than 39.1million anglers who have fished for 618 million fishing days and taken 807 million trips. The industry’s growth rate is even more remarkable. Between 1955-1996, the number and growth of anglers was twice that of the U.S.

Management

It is important to focus on what you are best at. This is the foundation of the business model. Seacliff is a firm believer in this principle and has focused on design. Willamette University JD/MBA degree is the education of the owner. This dual degree provided valuable insight into business development, and also gave him the opportunity to use patents/licenses as a legal tool. He was uncertain about his future career path after graduation so he went to Oregon to become a fly fishing guide. He was hooked on fishing for 2 years and knew he wanted to stay in the industry. On the assumption that he could design and develop fishing products, he went back to school and obtained a Masters of Engineering. He developed the Supreme Hook right at the end of his final graduate degree. On the basis of his JD/MBA degree, he was confident to start his own business and find a licensee for his soon-to-be patented product.

Seacliff is an innovative company that avoids the traditional need for significant start-up capital to produce a product. Instead, it licenses a patented item. Seacliff’s time can be used to focus on future designs and other value-added activities by licensing the product. Profitability will be attained in the first month.

1.1 Mission

Seacliff’s mission is to maximize the profits from its Supreme patent-pending fish hook invention and to develop new products that are suitable for the fishing gear market.

1.2 Keys for Success

The key to making this patent license profitable is:

1. To seperate the manufacturing and marketing of the Supreme.
2. Find a manufacturer that can produce the hook, and offer them exclusivity.
3. Choose a marketing company with significant fishing gear knowledge who is willing and able to allocate the necessary marketing budget.
4. Seacliff and the marketer should create a fair, well-thought out, and exclusive licensing agreement. This will ensure a mutually profitable partnership arrangement.

These are the keys for success when profiting off the patent in make–it-yourself form.

1. Recognize there is a wider market for the product.
2. Follow the time-tested price structure that offers attractive margins to every member of the distribution channel (manufacturer representative, wholesalers, and retailers).

1.3 Objectives

The main objectives of the program are:

1. Find a manufacturer that is willing to make the Supreme hook on an exclusive basis at a fair price. At retail, the Supreme hook would be sold for less than 150% of a regular hook of similar size.
2. Locate a medium-sized fishing gear marketing company who recognizes the potential of the patent and is willing to commit the resources to successfully mass-merchandise the Supreme, both domestically and overseas. A three percent royalty will be paid on all purchases made by the exclusive manufacturer under an exclusive license arrangement.
3. Market successfully the product in kits form. Within three months, reach break-even point (370 kits). Sell 8,333 kits in the first year.
4. Complete the website design.
5. Join the American Sportfishing Association to secure a booth in the ASA trade show at Los Vegas in July.