1. Be first to market
Now more than ever, being first to market is one of the best ways to fight against IP theft. Let’s say that your product really is the next big thing in your niche… it’s going to be ripped off. Once you accept that premise, you can approach this project from a different angle.
We work with hundreds of clients to get their products manufactured and prototyped in China. Big and small clients alike have been adopting an FTM (first to market) approach.
Do the heavy lifting up front and get your manufacturing/supply chain/logistics prepared to run like a Swiss watch. Hit the product launch HARD! If you get out on top of the market and slather it with your brand, copycats are going to have a harder time eating into your market share.
Assume there will be copycats, and make sure that your design and quality will be better than anything they bring to the table.
2. Plan for success
When picking your manufacturing partners and factories, figure out how scalable the production can be. If there really is a demand for your product, you don’t want to be caught with your pants around your ankles in bed with a factory that can only produce 500 units a month when you need 50000.
That doesn’t mean you need to go straight to Foxconn. Just make sure you get an idea of your manufacturer’s ability to scale.
3. Physically protect your IP
Sure, for some products… patents can be effective. But for the vast majority, it is a waste of time and money.
The most effective way to protect your IP in China is to compartmentalize your product as much as possible. Have every component manufactured in its own specialized factory. For a watch, we would have a separate factory for the case/lugs/crown/strap/hands/bezel/dial/crystal/buckle. Then we would have it assembled in a factory that we have a strong relationship with.
This does two things.
1. It protects your IP.
Let no man hold all the keys to your kingdom. The factory making the dial only sees the design files for the dial. They have no clue what the final product looks like. A lot of IP theft comes from factory owners manufacturing the complete product. Once they see your product becoming successful, they can shut their doors to you, and keep pumping them out under their own name.
2. It cuts cost and improves quality.
You’re going straight to the source. If you don’t make a deal directly with the “dial” factory, someone else is taking a cut. Seeing as they only make dials, they are much more focused and experienced with this specific component. You aren’t having to play broken telephone through 3 different people to solve a QC issue on the dial component.
TL;DR People will copy you if your product is successful. Do it better, faster, and be ready to scale.