Almost all great ideas start with a sketch. Even if you are not particularly good at drawing, you'll still probably want to jot down some quick sketches to help you better visualize your idea. Danny P. wallets grew out of a single sketch. You can see that the final product turned out a little bit different from that first original sketch, which had the case on the top of the wallet instead of inside it.
After producing a sketch you are satisfied with, turn your idea into something tangible with a prototype. Sketches are good starting points, but eventually you'll want to (literally) wrap your hands around your idea. I made the first Danny P. prototype using paper and a staple. Although it looked nothing like the final product, it gave me a real sense of what my idea could (and would) eventually become. The prototype was the approximate size of the wallet and case I had visualized, and I was easily able to slip my iPhone into it.
Your prototype doesn't need to be perfect. It just needs to serve its purpose, which is to give you a better idea of how to make your dream a reality.