Business Incubation

Business incubation is the process of nurturing small and start – up initiatives or business to relative maturity to become self-sustaining business, healthy and wealth-generating entities.
The failure rate of any start-up business stands at 90% globally.

The main causes of business

  1. Insufficient capital for start-up.
  2. Insufficient knowledge of business and industry.
  3. Lack of Entrepreneurial and business skills.
  4. Lack of Managerial skills.
  5. Inadequate Training.
  6. Lack of credit facilities.
  7. Lack of markets.
  8. Insufficient knowledge of markets.
  9. Inadequate infrastructure.
  10. Non-Empowering political environment.

For these reasons, many businesses which are ill-equipped do not survive. A business incubator is important for precisely those reasons above to provide these support services. Statistics show that the success rate for incubated businesses initiatives is very
high (over 80%) are bound to succeed.

The Incubation Process

  1. Help with business basics.
  2. Networking activities.
  3. Marketing assistance.
  4. Help with accounting and other financial management.
  5. Access to bank loans and other funds.
  6. Link to resource centers such as training institutions.
  7. Link to strategic partners.
  8. Help in the identification of a management team.
  9. Commercializing assistance.

The business incubation programmes are designed to accelerate successful development of entrepreneurial companies through an avvary of support resources and services. Incubators vary in the way they deliver their services in their organizational
structure and in the types of clients they serve. Business incubators differ from research and technology in their dedication to
start-up and early stage businesses. Research and Technology institutes tend to be large scale projects that house everything from corporate government or university labs to very small companies.

The research institutions do not offer business assistance services which are the main objective of business incubation. Unlike many business assistance programmes business incubators do not serve any and all companies. Entrepreneurs who may wish to enter a business incubation program must apply for admission. Acceptance criteria vary from program to program but in general only those
with feasible business ideas and workable business plan are admitted. The time a company spends in an incubation programme vary widely depending on a number of factors, including the type of business and the Entrepreneur’s level of business Expertise.

The Benefits of Incubation.

  1. Creating jobs and wealth
  2. Fosters a community’s Entrepreneurial climate
  3. Technology commercialization.
  4. Diversification of Local Resource.
  5. Acceleration of local development.
  6. Facilitation of Business creation and growth.
  7. Encouraging entrepreneurship especially women.
  8. Revitalization of the community as a whole.
  9. Growth of Private Sector Investment.
  10. Increased Tax Revenue.
  11. Equitable Development.

Government Roles in Promoting Incubation

  1. Creation of an enabling environment through;
    Purchasing consumer products.
    Support programmes financially of the incubation process.
  2. Government policy to buy from incubators.
  3. Give small scale businesses loans and grants.
  4. Launch campaign to sensitize the private sector to work with business incubation initiative.
  5. Take a lead role in the incubation process.
  6. Assist in the coordination, encouraging and streamling the efforts of incubation at National level.
  7. Lobby and Rally with Kenyans in Diaspora together with developing partners to support business Incubation.
  8. To encourage coordination of independent efforts country-wide for better synergy and a more effective Natural impact
  9. To rally universities and other research institutions behind the concept to facilitate research and development in order to enrich business incubation
  10. To provide support to business incubation initiative by providing morale support through Media Initiatives.

Protections of Business ideas & maintaining Secrecy

Most entrepreneurs will not be inventors, at least not in the classic sense but all entrepreneurs are concerned with protecting their business ideas, especially
when those ideas are related to;

  • Un usual production
  • Unique designs et.c

And for this to be done understand the “ patent law” becomes but simply paramount When entrepreneurs want to protect unusual brand name, products business ideas or simply establishing ownership, then understanding trade marks and copyrights if vital as a way of protecting a business idea.

The government law pertaining to;

  • Patents
  • Trademarks
  • Copyrights – are not complicated

Many entrepreneurs file their own patent claims or prepare documentation for trademark or copyright protection without professional help from the Attorney or patent agents. However it is always wise to have professional assistance though the laws are

Ways of Protecting Business ideas

1.A patent
A patent is a grant of property right by the government to an inventor. It is issued thought the commissioner of patent rights, and the most common type of patent is called a utility patent. All patent however, have the distinction of being assets with a commercial value because they provide exclusive rights of ownership the patent holders. Patents are exclusive property rights that can be sold, transferred, or used as collateral much alike other valueable assets.

The patent law stipulates broad categories of what can and cannot be patented and in the words of the statute any person who “ invents or discovers any new and useful process, machine manufacture, or composition of matter, or ay new
and useful improvements thereof may obtain a patent” Anything that is patentable must be new and useful ( must have some
demonstrated function)

The Nature of Patentable Inventions
The terms used give classification of patentable

1. Process – The word process as used in patents refers to new methods of manufacturing or new technological procedures that can be validated as unique.
2. Machine – In patent law means that the patent application if for a specific physical item.
3. Manufacture- refers to physical items that have fabricated through new combinations of materials or technical applications.
The application must explain how the product is made including materials processes e.t.c.
4. Composition of Matter- this category is patent law relates to the chemical compounds such as synthetic materials, medicine, cosmetics etc

Types of Patents
Patent law provides for three categories of patents namely

  • Utility patent
  • Design patent
  • Plant patent.

1. The utility patent
utility patent is granted for new products processes, machines, methods of manufacturing and composition of matter This category excludes, most botanical creations related to plant and agricultural use.
2. The design patents
Are granted for any new or original ornamental design for an article of manufacture. A design patent protects the appearance of an article and not the article itself.
3. The plant patents
In botanical terms any, new variety of plant that have been sexually reproduced can be granted a plant patent. The new plant must not exist in nature or in an un cultivated state. Therefore new plants hybrids and seedlings may be patented.
4. Disclosures
The patent office provides an important service of limited protection through the invention disclosure programme As a first step in seeking protection form the disclosure statement – the aim is to register an idea with the government.
The investor explains what the items is, that it is new and useful and how it is to be used copy is given or photograph. This gives the investors protection as evidence of any legal tassel, or conflicting claims giving the investor priority.

The Patent Procedures

1.The disclosure
When an idea is first reduced to sketches on paper or when it is mocked up, a disclosure should be filed. This is a measure of insurance that precedes the actual patent and provides legal recognition for all aspiring inventors. If someone took the sketches or steals the idea, evidence is on record.

2.The patent sketch
A patent sketch is required to determine whether an inventor’s creation already exists and remains actively protected under the law.

3.The preliminary section
The preliminary search scans the patent summaries for prior claims or invention
Records are accessed to make judgments and diligent decisions are made.

4. Collecting search documents
The application can the collect the approved documents for further processing.

5.Making the patent application
A formal application is now made at the search and is sent to the commissioner of patents and trade market
The application contains three parts

  • A description of the item
  • A set of drawings
  • A formal oath or declaration
  • Payment of patent filing ideas

Trademarks include any word, name, symbol or distinguishing device or any combination thereof adopted and used by a manufacturer or merchant to identify his goods and distinguish them from those manufactured or sold by others.
Trade-marks can be names used in commerce such as KCA it can be a symbol or any distinguishing device artistic in nature. An important qualification for a trademark is that mark, name etc. must be used commercially.

Service mark Is similar to at trademark and can be registered in the same way
with the sale protection A service market can be a name, wording used in advertising symbols or artistic figures that create a distinctive service concept.

Are similar to patents in establishing ownership and protection for creative ideas but they pertain to the intellectual property. The copyright is distinct from patents and trademarks in that intellectual property is protected for the life of the originator plus a further 50 years. This protection affords an extraordinary property right and substantial estates. It extends protection to author, composers and artists.

Trade Secrets
Are proprietary information used in the course of business to gain an advantage in manufacturing or commercialization of products or services.
Trade secrets

  1. formulas
  2. patterns
  3. list of customers
  4. data bases
  5. chemical compounds
  6. combinations of ingredients for commercial products
  7.  process of manufacturing
  8. Complied information.

Every organization must keep their secrets because
Modern communications systems contain so much information which if not guarded, the business may collapse.
Employees leaving may disseminate information to competitors.
In any business to maintain a market Niche, then desire to protect their product.

Trade Secrets
In certain instances the entrepreneur may prefer to maintain an idea or process as confidential, and eventually sell or license it as a trade secret. The trade secret will have a life as long as the idea or process remains secret. A trade secret in not covered by any law but is recognized under a governing body.

Employees involved in working with an idea or process may be asked to first sign a confidential information agreement that will protect against their giving out the trade secret either while as employees or when leaving the organization – this is called trade secret non -disclosure agreement. Most entrepreneurs have limited resources so they choose not to find means of
protecting their ideas or products or services.

Steps to be taken in order to maintain Secrecy in an Organization.

  1. Train employees to refer sensitive questions to designated personnel
  2. Provide proper security measures such as escorts to all visitors
  3. Avoid discussing business ideas in public places
  4. Keep important travel plans secret.
  5. Control information that might be presented by employees at conferences or published journals
  6. Use simple security measures such as locked file cabinets, passwords or computers, shedders e.t.c.
  7. Have employees and consultants sign non-disclosure agreements.
  8. Debrief departing employees on any confidential information.
  9. Avoid faxing any sensitive information
  10. Mark documents confidential when needed.
  11. Unfortunately protection against the leaking to trade secrets is difficult to enforce.

Licensing may be defined as an agreement between two parties, where one party has proprietary rights over some information, process or technology protected by a patent, trademark or copyright. This arrangement specified in a contract requires the licence to pay royalty or some other specified sum to the holder of the proprietary rights in return for permission to copy the patent trade mark or copyright.

Licensing has significance as a marketing strategy to holders of patents, trademarks or copyrights to grow their business in a new market when they lack resources or experiences in such markets. It is also an important marketing strategy for entrepreneurs who wish to start a new venture but need permission to a copy or incorporate the patent trademark or copyright with the ideas.

Product Safety and Liability
It is very important for the entrepreneur to assess whether any product that is to be marketed in the new venture is subject to any regulations under the consumer product. In addition to setting standards for products the commission also has a great deal
of responsibility and power to identify what to consider being a substantial hazard and barring any products that may be considered unsafe.

Any products introduced by entrepreneurs must obtain clearance from the Kenya bureau of standards under the consumers protection Act.

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