A small business grants guide for 2017
Here, Peter Fleming takes a look at a range of options for funding your business through grants this year.
There are many European and UK-wide government business grant schemes; there are also local business funding schemes provided through Local Enterprise Partnerships (LEPs) or through local authorities and organisations such as the Chambers of Commerce. However there were 512 registered schemes at the last count! So a good place to start your research is on the government website.
Business grants are available at a local and national level and usually sector specific. They offer between £1,000 and £100,000 for SMEs, but funds can be unlimited for larger businesses within EU state aid programmes.
With grants you don’t pay the money back. However, it’s worth noting there will be clawback terms if you falsify claims in respect to expected outputs set by the grant scheme. Therefore, ensure your application is captivating and thorough as it will go through a due diligence process.
Normally there are two stages, submitting an Expression of Interest (EOI) to ensure your business and grant application meets the scope of the grant call and then a full application process whereby you will need to supply, market research, a business plan and at least 1-3 years of financial forecasts.
Throughout the process, you will need to justify there is additionality i.e. not just the reason why you need funding, but by obtaining a grant, how many new jobs you will create, if you’re opening up new markets or export opportunities or that your idea could be a game changer.
It is always worth getting a second opinion regarding the feasibility and strength of your application against the grant objectives and any regional strategic economic plan. Therefore speak to your accountant, a local business adviser or the Growth Hub.
The larger grant opportunities can be competitive and therefore be a long-drawn-out process, taking several months in some cases to receive just an offer. So if you are looking for subsidies and money quickly a grant may not be the right solution for your business.
It is also worth noting if your application is successful, grant moneys are not paid upfront but claimed normally at the back end of the project or even after any intervention is completed.
Therefore you will need to use your own cash reserves and any other funding prior to drawing down the grant money. I have even known businesses take out bridging loans till they have received their grant funds.
Some key areas of your business whereby you could access business advice or a grant;
Business advice and support, whether you are pre-start, a new start or an established business, there are regional Business Growth Hubs across the UK whereby you can obtain free or funded advice. You can normally obtain specialist support to devise a business growth strategy, do market research to create a sales and marketing plan, implement social media management or even get advice on how to apply for further funding.
Note each UK region may have a focus on specific business sectors, business sizes and locations, as eligibility can be even post code specific.
Skills and development
The Skills Funding Agency oversees the current apprenticeship scheme, however on May 1st 2017 the new Apprenticeship Levy scheme starts whereby your business could access subsidised training and development to upskill existing employees to even Master’s degree level.
Many regional Universities, Colleges and further education organisations will be offering a multitude of subsidised short courses or funded degree level programmes which will help you develop your existing staff to be the managers and directors of the future.
If your business is within a rural development area and looking to grow, invest in infrastructure, machinery or seek specialist advice to diversify. Or if your business is involved with forestry and land projects the government have a scheme called LEADER managed through Local Action Groups.
Green Business Fund
The Carbon Trust Green Business Fund is a new energy efficiency support service for small and medium-sized companies in England, Scotland and Wales.
It provides direct funded support through energy assessments, training workshops, equipment procurement support and up to £10,000 capital contribution towards the purchase of energy saving equipment.
Manufacturing is an area which is increasingly supported through grant schemes. Therefore if you manufacture textiles, specialist tooling, operate in the digital market, within the nuclear supply chain or need support for international trade, or manufacture in many other sectors, there is likely to be a grant scheme that your business can access.
Take a look at the government business funding support finder website.
Innovation, Research and Development
Innovate UK, offers support and funding to help businesses develop new products and services and bring them closer to market, this may be to bring people together to share ideas, tackle challenges and make new technological advances.
They targets technologies and areas with the greatest scope to improve business, the economy and society.
Local Enterprise Partnership
For anyone looking for grants at the moment, the go-to people will be their Local Enterprise Partnership (LEP). One of the main functions of the LEPS is to generate economic growth and so many have their own grants programmes.
In addition, most provide some form of business support and advice. As part of the business advice service they collate information on local and national grants and will signpost business owners to the relevant organisations.
Another great source of information is the government ‘Business is Great’ website which has a page dedicated to a number of funds to support innovation.
There is also is an EU tool which does a better job than anything I’ve seen of clarifying what finance is available across the EU including although is does require some persistence in searching to get to the information.
For companies and individuals with ground breaking research which may require significant funding there is also Horizon 2020:
Key thing to remember
Grant funding is not for everyone but could give your business the boost it needs. Proper preparation, thorough research, getting professional advice and being able to clearly explain why you require your grant funding is more likely to lead to a successful application. And, as a result, help you obtain the financial support for a better, bigger and more profitable business for you.
This article was provided by Peter Fleming of BusinessDoctors.co.uk.