How does 'royalty' works?

Question

Just say, i have a design... i want to introduce it to manufacturer or design companys, how does royalty works? ... i get paid for what? .. and when do i get paid? .. do anyone know about IP ... please help... thank u!

Answer 1

Say you have a Patent / Copyright .... (ideas are cheap .. about 10 a penny :-) )

.. you MUST have Patents / Copyright to protect your IP rights,  otherwise 'they' will simply 'copy' your design and give you nothing ...

You will need to sign a Contract with the Manufacturer / Distributor etc. and if this is based on Royalties, you get paid a percentage of the sale price on each one that is sold.

How the Royalty is calculated depends on the exact Contract details - if your agreement is with the Manufacturer, you would typically be paid a % of the 'factory door' sale price = which is obviously less that the retail price BUT you get paid irrespective of it actually being sold to the public .. end sale Royalty might be better, but if the products fail to sell, you get nothing (and if sold at a discount you get less)..

MOST Book authors have Agents to organise all this for them (and charge a %) .. I guess there must be specialists who can do the same for inventors .. see if you can find an 'inventors forum' or similar on-line and find out what others do .. (do NOT reveal exact details of you inventions BEFORE applying for Patents or you will be refused)