For novice inventors, however, we do offer further advice. This section is aimed at inventors and small businesses inexperienced in electronic prototype product development. The potential profit may make the risk acceptable to the inventor but unless prepaid, it is usually not to the engineering firm doing the prototype because they have less control, less knowledge of the market, and less potential profit. To reduce financial risk, the development is divided into stages or phases. The initial stage has the highest risk but also the lowest cost.
Later stages have increasing costs, but the risk of failure is less.
Government and commercial projects are often done is three stages, but projects supported by individuals are often divided into more parts with payment due after reaching each milestone. Some information on typical project costs follow. Bringing an invention from the concept stage to a profitable product is difficult and the probability of success is uncomfortably low. We recommend that a business plan be prepared with the help of local legal and business advisors, before investing in a prototype development. Be aware that many invention promotion companies have a poor reputation for effectiveness.