A prototype is an example of your product before it goes to production with the goal of testing its feasibility.
With a prototype you can see problems before you go to production and weed out any approaches that don't work. You can also streamline the production process before you start. The smoother the production process, the more money you will save.
Better Understanding of the Design
Your idea is easier to conceptualize if you can see the product. When you can see and feel and manipulate the product you can better understand its limitations as well as its possibilities. It also helps your team to better understand what they are working with, from helping with the design to the marketing and packaging of the product.
Testing and Evaluating
With a prototype you can get early feedback from potential customers. What parts need to be revised? What did customers like or dislike? You can also test out the use of other materials. The material you thought you would use in the beginning may turn out to not be the best fit for your product. It gives you a chance to refine your design and test out new materials.
When investors see a product they can conceptualize what they are investing in and if it is worth their investment. Some investors may even ask for a proof of concept. If they see a validated working prototype it is less risk. It is also easier to sell to potential customers if they can see the product and manipulate it.
Getting a Patent
You can sit down with a patent attorney to see what aspects of your design are patentable. On the flip side a patent attorney can then tell you what aspects might be violating a patent. You can also test out different variations to make your patent stronger.
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