Trade Secrets have a Time Value

Trade Secrets Can Have A Time Value

In many cases, trade secrets have value because of time.

If you are planning on launching a product, your trade secrets will eventually get into the open, but they have more value during the planning phase.

All products should address a weakness in the market.  Your product or service may address an unmet need that you sense.  That unmet need may be a completely new way of doing something, or may be a cost reduction or other improvement of an existing product.

As you work through the issues with the unmet need, you want to keep the entire concept under wraps.  This gives you a competitive advantage of timing.

Your trade secret is that you sense the unmet need and have a solution.  Once you launch that solution, that trade secret will disappear, but you will have the tactical advantage of preparation over your competitors.

These types of trade secrets can have less and less value as you get ready to launch.

For example, let’s say your product has a three year development cycle.  When you are three years out, the trade secret can be very valuable, since any hint of it will tip your hand to a competitor.  The trade secret represents a possible three year jump on your competitors.

As you get nearer to launch, your competitors are already three years behind you.  They will have to spend three years to design a product, tool up for manufacturing, etc.

In many cases, a trade secret may be valuable to build hype as part of a marketing campaign.  These types of trade secrets can be very tightly held until the Big Reveal, where you build the public into a frenzy and drop the bomb of the big product.

The point here is that trade secrets can come in a huge number of forms and sizes.  Businesses use the trade secrets in many different ways to establish a competitive advantage.