Lifetime Brands looks outside for inventions
Thaddeus Alemao says he was "cocksure" about his invention: an odor-absorbing splatter screen for cooking. Lifetime Brands Inc. made it pay off.
Alemao, a former banker and now full-time entrepreneur from Oceanside, had spent five years and $50,000 of his own money developing the screen, which can be placed on top of a skillet while frying fish, for instance. Then he brought it to Lifetime, the Garden City-based maker and designer of housewares and kitchen tools. In just a year, Lifetime revamped his invention and, since 2009, has been selling several versions to major retailers such as Bed Bath & Beyond and Wal-Mart.
Lifetime, which launches as many as 5,000 new items a year, is on a mission to find the next big hits in kitchenware. And some of those ideas have sprung from the garages and home workshops of the tinkering masses.
These inventions aren't necessarily world-transforming products like the television or the iPhone. But they are the kinds of ingenious everyday products -- a colander with a hinged door on the bottom; Misto, a gourmet olive oil sprayer -- that make life a little more convenient.
They have paid off for Lifetime, which reported profits of $20.9 million on revenues of $486.8 million in 2012.
And while many of Lifetime's products are designed in-house, its collaboration with independent inventors like Alemao has also paid off: Products from its "open innovation" program have generated over $50 million in retail sales since 2009, the company said.
To that end, the company courts outside inventors, participated in the Food Network's "Invention Hunters" show and hosted an "Inventor's Day" at its headquarters last year.
"We believe in having newness and innovation," said Dan Siegel, Lifetime's president. "Every retailer wants the next new thing, and we will find that in any way we can, because that's part of Lifetime's culture."
Even with Lifetime's large staff of about 100 industrial engineers and designers, the contributions of outside inventors are essential in today's competitive environment, experts said.
"Getting ideas for new products is a numbers game," said David Robertson, a professor at the Wharton School at the University of Pennsylvania and the author of "Brick by Brick: How LEGO Reinvented its Innovation System and Conquered the Toy Industry." "The way to have a great idea is to get lots of ideas."
Focus on open innovation
This open innovation concept is decades old but has received attention in recent years as more companies announce initiatives to open up their methods of generating new products. Procter & Gamble, viewed by many as a leader in open innovation, established its Connect + Develop program more than a decade ago and, in February, launched a new website designed to make collaboration with inventors outside the company more efficient.
Other companies have drawn headlines by attempting to crowdsource ideas for new products and even split royalties among hundreds of contributors.
Lifetime's program was partly inspired by Procter & Gamble's efforts and also has its roots in a broader, companywide system called "Ideas of a Lifetime." This initiative has solicited ideas large and small, including ways to save the company money. Many of those suggestions have been put into action.
"Taking that logic, we thought, 'What if we opened it up to the United States?' " Siegel said. "You have a population of 320 million or so. They have ideas related to what we do, which is food preparation. How do we make it easy for them to come to Lifetime?"
Warren Tuttle, an independent consultant, serves as the company's scout and liaison to the outside inventor community. He describes Lifetime's external product development program as the opposite of crowdsourcing models, in which many people contribute to a concept and get credit.
It's a highly selective process, Tuttle said. Of about 100 submissions, he might choose about 30 concepts to present to Lifetime. Over the last year, the company has signed about 15 inventions that have resulted in more than 30 different products, including the Farberware Seasoning Stick, which Indiana inventor Mary Hunter designed to eliminate long marinating times and permeate meat or fish with seasonings while cooking. Another product, Farberware Produce Freshies, invented by Brenda Patterson and Amber McBride from Gold Canyon, Ariz., is a packet designed to extend the freshness of fruits and vegetables.
Inventors and their ideas come to Tuttle, who is also president of the United Inventors Association, in all stages of development. Before finding Lifetime's program, Alemao said he had created prototypes, tried to sell his odor-absorbing splatter screen in South America and weathered his family's worries that he was throwing money down the drain.
Inventors should thoroughly research their idea, looking to see if there are already similar items on the market, Tuttle said. The company wants inventors to have a utility patent or a provisional patent, which is good for a year, as well as a working prototype, "even if it's rudimentary and it's ugly," said Tuttle, who has a questionnaire on his website,
Monasheemarketing.com, for inventors who want to commercialize their products.
"They own their idea, so if it doesn't work out with us, they have what they put their heart into and they own that," Siegel said.
Inventors negotiate a deal, which typically involves a small advance on royalties of about 2 percent to 5 percent of sales. Then the invention receives the full focus of Lifetime's teams, who make sure the patent adequately protects the invention, test and improve the product, find suppliers for the materials and design different versions of the concept to be sold at different retailers. Independent inventors say the company takes over a process that often is a challenge for them on their own, especially getting their products into stores.
"I was ready to hand it over to someone to handle in a professional way," said Daniel Greenberg, 59, an architect by training from Cold Spring in Putnam County. He has partnered with Lifetime to produce and sell his PermaLid food storage containers under the Farberware brand. The lids are attached, solving the issue of mismatched containers and tops.
"I decided this is taking too long, and I don't want to go to China and deal with a factory, especially if I don't have a good agent who already knows who is safe to deal with or not."
From idea to model
Lifetime's design team can take an idea and turn it into a model "in no time flat" using prototype machines and 3-D computer-aided design software, said Bill Lazaroff, senior vice president of product development and design. "They know how to solve problems," he said. "They know how to build things and improve things."
Engineers revamp the product, taking into account the different pricing calculations and the various brands under which it will be sold. They created about 10 versions for the splatter screen, adding features such as a folding handle. "They made it beautiful," the device's inventor, Alemao, said.
In turn, the odor-absorbing splatter screen gave the company entree to new retail customers, Lazaroff said. "Because it was so unusual, it became irresistible to them," he said. "We could design something just for them."
Coming up with more than one hit in houseware gadgetry is extremely difficult for the lone inventor. But for Alemao, 61, the payoff from his odor-sborbing splatter screen has been significant, he said. Lifetime had the professional expertise and the infrastructure to develop, market and distribute his device on a large scale -- a process that would have been difficult, at best, on his own.
The royalties he earned from his one invention allowed him to start a 15-person company, Bombay Innovative Products Pvt. Ltd, in his native Goa, India. It manufactures and sells devices and products to eliminate mosquitoes, a public health menace. And he has enough funding to give away one of his company's products, called the Mosqui Trap, for free.
The Mosqui Trap allows gasses to escape septic tanks, the main method of sewage disposal in India, but keeps mosquitoes from entering and breeding, he said.
"It's a childhood dream," Alemao said. "The money to do this comes from my royalties."