Invention Quest: Right Combination

This is a partial transcript from "Your World with Neil Cavuto", March 10, 2004, that was edited for clarity.

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NEIL CAVUTO, HOST: A big invention doesn’t always mean big bucks, but pair of catchy idea with one of the nation’s biggest office supply chains, and your chances for success go up a lot. I’ve got to hand it to my next guest for doing just that.

Joining me now is Michael Miles. He is the chief operating officer over at Staples. And the winner of Staples’ Invention Quest, Todd Basche.

Todd, what did you come up with here?

TODD BASCHE, INVENTION QUEST WINNER: Well, it is a combination lock that allows you -- kids or adults -- to set the combination using words, instead of numbers.

CAVUTO: Can we get a close-up of this? I don’t know, Peter, if you can see this here, but it’s a really wild thing. You just have a word spelled out here.

BASCHE: Right.

CAVUTO: It is so simple. I should have come up with this. What the heck was I thinking.

BASCHE: You should have.

CAVUTO: And so that intrigued you? You thought it was brilliant, right?

MICHAEL MILES, COO, STAPLES (SPLS): Absolutely. At Staples, we make office products easy, and we are always looking for new products to make our customers’ lives easy. We had this Invention Quest that we launched this year, and came up with 8,300 different ideas for office products or other things to make life easy. Todd’s won after a rigorous competition which saw 12 finalists come here to New York.

CAVUTO: So it wasn’t like a "Survivor" deal, was it? That he killed off the other...

MILES: No, but the judging was pretty rigorous.

CAVUTO: Was it really?

BASCHE: Indeed, yes.

CAVUTO: What do you get for this?

BASCHE: Well, there was a cash award of $25,000. And really, a tremendous amount of satisfaction of actually thinking something in your head and having it come all the way to market. I mean, that is really the exciting part.

CAVUTO: Yes, 25,000, that’s nice. But do you get a percentage of the sales?

BASCHE: Well, that is still to be worked out with Staples about trying to make it be a real product.

CAVUTO: Because, Todd, this is brilliant. You know, if I were your agent here, you’ve got to work something here. No offense to Michael, but you’ve got work something here.

So he’s on to something big...

MILES: We’re very excited about selling it. And there are a number of other ideas.

CAVUTO: But you are the sole distributor for this, right?

MILES: that’s correct. We have exclusive rights as a part of this, and we think we can make a big product out of this, and as well some of the other products that came out.

CAVUTO: How much would you sell that for?

MILES: I’m not sure what the product cost of that will be. Have you thought through that yet?

BASCHE: Yes, the product cost is actually identical to any other combination lock. So you can charge a premium for it if you want to and still make the same gross margins.

CAVUTO: OK. And you would get some gross margins.

MILES: He has it all figured out.

CAVUTO: Todd figured this all out, but he’s just not going to discuss it here. But he’s figured it all out.

Well, Michael, it is a good idea and smart marketing idea for Staples, because you send people this reminder that Staples has new and different stuff.

MILES: Sure.

CAVUTO: Did you fear that maybe between you and Office Depot that the office supply segment was kind of getting exhausted? You needed a fresh idea? What?

MILES: Oh, no. We have seen a lot of growth in office supplies. But I think what you are looking for and what we are looking for is always a reason to come to Staples, as opposed to one of the competition. A reason to drive by. And having unique and different products, in addition to being the easiest place to buy office supplies, is a key part of our strategy.

CAVUTO: Indeed. I think you have had, what, nine straight quarters of growing at, at least 12 percent...

MILES: Plus-20 percent. Yes, sir.

CAVUTO: Todd, let me ask you this, how have the other contestants, if you call them that, been treating you?

BASCHE: Well, like I say, the Staples Invention Quest was really a wonderful contest. It really reached out to all of America to try to get sort of the brightest people to come and submit ideas. And it was really a terrifically well-run process.

Several of them we had dinner with last night as part of the event. We are actually taking one of the other couples out to dinner as part of it.

CAVUTO: Really?

BASCHE: We’ve really become good friends with them. So it’s...

CAVUTO: Who treated?

BASCHE: Well, we...

CAVUTO: You got the check.

BASCHE: The bet we made at dinner last night was, "If you win, you buy, and if I win, I’ll buy.:

CAVUTO: All right. Todd Basche, thank you very much. Congratulations on this.

BASCHE: Thank you.

CAVUTO: Michael Miles, a great idea. We’ll see where it all goes.

MILES: Thank you.

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