MERITT MODEL

The Meritt Model is a business model that was first introduced in 1997 by Ron Meritt, the inventor of the “Portable Video in a Car”. In 1998 Mr. Meritt applied the model to his new invention and created a $250 million per year market within three years.

The model is very simple – identify or create a need (like entertaining children when driving in cars) that can be satisfied with a new product or an improved version of an existing product. This can be a consumer or commercial product, and it must have potential sales exceeding 100,000 units. Then, design and patent a product that would satisfy this need. Use contract design and manufacturing companies (preferably in Asia) to engineer and produce the product as efficiently and inexpensively as possible. Finally, license one or more companies that are leaders in the field of similar products to sell and distribute the product in multiple global markets.

From the beginning in 1998, Mr. Meritt managed a global market with a staff that never exceeded 10 employees. He partnered with very large corporations, including Nissho Iwai, a $56 billion Japanese trading company with a worldwide network of 175 offices in over 70 countries. This partnership enabled Meritt to sell his products to major retailers, including Wal Mart, Best Buy, Target, Sharper Image, K Mart, Sky Mall, Fry's Electronics, Circuit City, and many other large retailers.

Mr. Meritt continued to improve the Meritt Model over time. More than 20 versions of the portable video system were developed over six years, and as time went on, Mr. Meritt convinced suppliers to share development and tooling costs. He also discovered that providing and overseeing contract manufacturing services for large corporations was another opportunity to generate revenue.

The Meritt Model is not a product; it is a unique approach to business that netted Mr. Meritt royalty checks that sometimes exceeded $500,000 in one month. His model has become the focus of multiple media reports including the cover story of Forbes Magazine in 2003 and Entrepreneur Magazine's 2004 Buyer's Guide. The Meritt Model is a low cost approach to bring new products to market with limited risk and minimal expenses.