A young woman closely inspects a 3D-printed model of a product prototype she is working on.
Prototypes determine whether a design will work and whether you need to make any necessary adjustments before spending your valuable budget on mass production. — Getty Images/ Sunwoo Jung

A prototype is a functional, not final, version of a product or service that businesses can use for testing, to solicit feedback, and to introduce to investors before officially launching to a wider market. Prototypes are used to determine whether a design will work and to make any necessary adjustments before spending your valuable budget on mass production.

Prototypes can take many forms. Some prototypes are simple wireframes for a website design; others are made from common household items to demonstrate the idea; others are high-fidelity versions of a final product that could quickly be finalized and brought to market. The type of prototype you create depends on your budget, goals, and expertise. This guide will outline the various options for creating a prototype for your product or service.

Considerations before getting started

The approach you take to creating a prototype depends on certain conditions. There are many ways to create a prototype, from working with a third-party design firm to using Play-Doh to give someone an impression of your idea. Before you get started, think through these questions:

  • How much do you want to spend? Outsourcing your prototype to a professional firm can cost anywhere between a few hundred dollars to $100,000. If you create your own prototype, you can use 3D printing, modeling clay, or something called InstaMorph, a plastic prototyping material that retails for around $15.
  • Who is the audience for your prototype? Investors want to see a close-to-perfect model of your product or at least one that illustrates your ultimate goal. But if you're simply soliciting feedback from friends, mentors, and co-workers, you can keep it simple.
  • Where are you in the design process? It's not worth creating a close-to-perfect prototype if you think there will be many adjustments to the design. Wait until after you've collected feedback from various sources to develop an advanced prototype.

[Read more: 10 Innovative 3D Printing Business Ideas]

With these questions in mind, here are some ways to create prototypes for new products and services.

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Before you move on to an advanced prototype, you'll want to protect your intellectual property. Ask employees, testers, and partners to sign a nondisclosure agreement and consider filing a patent for your design.

How to create a product prototype

The process of creating a prototype may mean you end up with multiple mock-ups, drawings, and models. The goal is to iteratively bring your idea to life.

"When you make your first prototype, it's about bringing your idea into the world to see if it can actually be made. Then, as you progress in the prototyping process, it's about examining the strengths and weaknesses of your product by comparing it to what else is out there," wrote the experts at Masterclass.

Start by creating sketches of your product idea. This can help you envision the size and shape and the materials you might need to design the product. From there, move on to creating a simple version with low-cost materials. "Remember, there are no rules! Give yourself permission to experiment. Look around the house and select materials that you can use to test to see if your idea works," wrote Entrepreneur.

At some point, before you move on to an advanced prototype, you'll want to protect your intellectual property. Ask employees, testers, and partners to sign a nondisclosure agreement and consider filing a patent for your design.

[Read more: How to Protect Your Intellectual Property]

How to create a service prototype

A service prototype is slightly easier to create since you won't need to find materials or make sketches. A service prototype considers the before, during, and after of the customer experience.

What's difficult about a service prototype is boiling your design down to the basic things you need to test. "Figure out what elements of your service are necessary to show potential users what their experience would actually feel like, and eliminate the rest," wrote IDEO. "For instance, if you want people to feel welcomed to an experience, you might spend more time designing the human-to-human interactions, and less time figuring out the design of the space where the interactions take place."

Think about the people, space, and virtual or physical objects you need to make this experience match your vision. Then test each of these things individually to find the combination that works best for customers.

Costs and timelines: What to expect when prototyping

Of course, the cost and time it will take to bring your prototype to life depends largely on what you're hoping to create. Sketching a rough design of a new product on a bar napkin costs very little; the cost of turning that idea into a more complex prototype with electronic components may reach between $10,000 and $50,000.

"On average, prototyping can be done between $3,000-$10,000," wrote the LA New Product Development Team (LA NPDT), a product development company. "The cost usually depends on the iterations that go into the product prototype. And that is often a function of the complexity of the product at hand." The company offers a prototype cost calculator that can help you estimate how much your prototype will cost.

The same logic applies to your prototype timeline. The more complex your product idea, the longer it will take to develop. Partnering with a development team like LA NPDT can help speed up the process since they have tools and access to equipment that most entrepreneurs lack.

"For prototyping that is done mainly via 3D printing, it might take several hours in a day or sometimes spill over into a few days," wrote LA NPDT. "But we usually spend between 1 to 2 months to build an invention prototype. And this is the standard for most prototyping done."

What to know about working with third-party prototype developers

Many prototype development companies act as thought partners and work quickly to bring your idea to fruition. Before working with any collaborator, protect your intellectual property by trademarking your design or filing for a patent. You may also decide to ask partners to sign nondisclosure agreements if the market for your idea is highly competitive.

Working with a third-party prototype developer delivers the advantages of speed, resources, and expertise. These developers have access to equipment and talent that would be cost-prohibitive for most entrepreneurs. They can also help spot design flaws and improve upon your original idea.

However, working with a third-party developer is more expensive than doing it on your own. Finding the right partner can be challenging, especially if you try to save money by working with an overseas supplier. Offshore design is cheaper but more labor-intensive since it often involves overcoming language barriers and time zone differences.

"When hiring third parties, you should do it to get better designs, improved insight, faster service, improved productivity, all totalling up to a great investment. Otherwise, you're just trading one issue with another," wrote Relab Academy.

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