What are the key elements of starting a new business?

Key elements of starting a new business include research, planning, and funding.

Expert Answers

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The first key element to starting a new business is research. Before a business officially gets underway, it should know as much as it can about its products and marketplace. Research can help a business determine how to effectively make and market its goods and services so that the business has the best chance of succeeding.

For example, say someone wants to start a coffee shop. They should do research as to where to open the coffee shop and what kind of coffee shop it will be. Maybe they were thinking of opening a quirky coffee shop in a certain area, yet that area, upon investigation, already has multiple quirky coffee shops. Now, thanks to their research, they know to open their new coffee business in a different place where there's less competition.

After conducting research, the fledgling entrepreneurs will need to compose a business plan. A key element of starting a new business is developing a clear, focused strategy. Each new business should have a blueprint that details how the business will be organized, managed, and profitable.

A third key element is funding. New businesses need seed money to get off the ground. The people aiming to start a new business will have to figure out how they'll initially fund their enterprise. Maybe they themselves have the money. If they don't, perhaps they can secure a loan or an investment. It's feasible that the funding will come from a combination of sources.

Besides research, a plan, and funding, other key elements involve picking a name for the business and making sure that the business has acquired any applicable licenses and permits. A new business does not want to start off in legal trouble.

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