Send in the Clones Will competitors' knockoffs destroy your products' edge? Not if you don't let them.

The BIZ Experiences: JaySorensen, 45, founder of Java Jacket in Portland, Oregon

The Product: Sorensen'sproduct, the Java Jacket, is a patented, honeycombed insulatingsleeve that slides over a paper cup filled with a hot beverage.Java Jackets are used in coffeehouses, specialty stores andconvenience stores nationwide. Sorensen's was the firstinsulating jacket on the market, and his first customer was CoffeePeople, a small chain of coffee shops in Portland, Oregon. ThoughStarbucks uses another type of insulating sleeve made by acompetitor, Sorensen's Java Jacket continues to dominate themarket.

Start-Up: $15,000 in 1993,which Sorensen used for product development and a production run ofmore than 100,000 units

Sales: $12 million to $15million projected for 2003

The Challenge: Establishingyour innovative product in the market and not backing down whenlarge and established competitors release their own variations ofyour product

Developing an innovative product is every inventor's dream.Finding success selling that product is even better. But this kindof success often breeds emulation-from large corporations, no less.When you're still growing your business, how do you stand apartfrom the knockoffs released by big corporations? Is it possible tobecome-and stay-the market leader? The answer is a resounding"yes." Just ask Sorensen. He knows firsthand how to fightthis fight, and here's what he's done to protect his placein the market:

Steps toSuccess
1. Find an advantage people willnotice. Sorensen first got his idea after spilling a hotcup of coffee. The cup was handed to him with a napkin around it,but it slipped out of his hand. He realized a cardboard or papersleeve that could easily slide around the cup would be a greatidea, but his unique advantage was in the design. "I wentaround Portland to a dozen paper suppliers to see what theycarried," he says. "I found a supplier who had embossedpaper [with] a honeycombed look to it. It had a quality image, andit was better than a simple sleeve."

2. Create a catchy name that sticks incustomers' minds. Java Jacket is a perfect name. Itdescribes what the product does, and it's a name customersremember. "Java Jacket has such a dominating market awarenessthat sometimes people who [meant] to call the competitor call usinstead," Sorensen says. "The trademarked Java Jacketname is worth more than our patents."

3. Find a fast way to reachcustomers. In 1993, while waiting in his firstcustomer's office for a check, Sorensen saw a trade magazine,Fresh Cup, on a table. "It listed [an upcoming] tradeshow in Chicago, and I called up and took a booth." At theshow, he met hundreds of potential customers. "It was the mostexciting three days I've experienced in business," herecalls. "I walked away with orders from more than 100 stores,and I had 200 customers by the end of 1993." When youdon't have a lot of money, you need a way to get in front ofcustomers at a minimum cost. Trade shows can be a great way to dojust that.

4. Keep overhead low. Thingscan turn against you when you compete with a big company, sominimize your investment and operating costs in order to quicklydownsize if needed. With the Java Jacket, Sorensen says, "Weoutsource all our production, and we only have six employees."That's low overhead when you're turning more than $12million in sales.

5. Promote your brand identityrelentlessly. "We attend eight to 10 trade showsper year, and we advertise regularly in all the industry trademagazines, including Fresh Cup, Specialty Coffee Retailer andthe Tea and Coffee Trade Journal," Sorensen says. He wantsthe Java Jacket name in front of prospects all the time.

6. Don't ignoreopportunities. A growing company needs to do whatever itcan to prevent a competitor from getting a foothold in a newmarket. In the past few years, many convenience stores startedoffering specialty coffees-and Java Jacket made sure to be rightthere. "Much of our growth has come from conveniencestores," he says. "They like the jackets because it stopspeople from double-cupping. A cup costs 6 cents vs. 3.5 cents for aJava Jacket." Convenience stores weren't Sorensen'soriginal market, but he went after them anyway to stop competitorsfrom gaining an easy market-entry point.

Lessons Learned

1. Don't think all the advantageslie with the big guys. While it's true growingbusinesses have trouble breaking into a market established by bigcompanies, they have plenty of breaks if they can get into a marketfirst. Customers like supporting the small company that created theinnovation, and they'll support that company as long as itspricing and delivery are right.

2. Drive customers todistributors. At one time, before he added distributors,Sorensen had more than 5,000 customers. That's too manycustomers for one small company to support. When customers call youdirect, find out if their distributor will furnish the product tothem. Tell customers that ordering will be easier if theirdistributor will carry a product. Distributors will add a productif they get enough requests for it. While distributors cut intoyour profit margin, they make up for it by stocking and deliveringyour product, and they can also help you rapidly expand yourmarket.

3. Don't waver onsupply. Customers will stay even if you'resmall-unless they fear you won't be able to supply them.That's when a big competitor has the chance to step in. If youcan't afford to support rapidly increasing sales, make a dealwith a manufacturer, seek a loan from a bank, or take on a partnerto be sure you can ship enough products to keep customershappy.

4. Keep your visibilityhigh. Attend trade shows, trade association meetings andindustry conferences, and maintain a prominent advertising presencein trade journals. Buyers are concerned that a small supplier mayrun out of funds and go out of business, so it's important tomaintain your visibility. If you drop out of sight, some of yourcustomers might think this is a sign you're in financialtrouble.

5. Be vigilant about patent andtrademark violations. When you're sitting on a hotnew market, competitors will test to see how vigorously you'lldefend your intellectual property. They might try to test-market asimilar idea, or they might try to market another product with aname similar to yours. A quick response from your patent attorneyis enough to stop many companies. Your best chance at minimizingyour legal fees is to stop these companies before they getstarted.

Don Debelak is the author of BIZ Experiences Magazine'sStart-Up Guide #1813, Bringing Your Product to Market. Write tohim at dondebelak34@msn.com.