Yes – they can be, but you need to ask yourself 10 key questions to help you decide:
10 Key Questions to help you decide
1. What do you want to do? Is what you want to do (‘the project’) eligible? Many (but not all) business grants tend to focus on capital expenditure.
2. What is the time frame for your project? If you need to get down to the machinery auction next week, then a business grant is not going to help. Your planned expenditure usually needs to be measured in months, not weeks, to allow time for a business grant application to be submitted, assessed, and then, hopefully approved.
3. What sector are you operating in? It may be that a particular business grant programme specifically excludes your sector, so do your homework. For example, business to business (‘B2B’) with an ‘added value’ component will often ‘tick the box’, whilst retail is invariably excluded.
4. Are you planning on creating jobs? This is usually a vital outcome, albeit jobs do not need to be created immediately. The number of jobs created usually affects the amount of grant available to you.
5. Business grants are matched funding. In other words, grants will only fund a percentage of the total project, usually up to a maximum of 50%, and often a lot less than this. You need to find the rest of the funding, and show why you really need that helping hand.
6. The application process may be competitive. How strong is your case compared to the firm down the road?
7. Business grants are not free. It will take time to apply for one. Are you willing to put the time into the process? The grant authority often has limited resource available to help you. Are you willing to pay someone else to help you? A word of warning: avoid the firms of ‘box tickers’ who have no commercial knowledge or understanding of your business! Do you really want your application in their hands?
8. Your application is not guaranteed to succeed. Ultimately a group or committee will decide the outcome.
9. Do not commit until you get a decision! A successful application will be, in part, based on need. If you decide to place an order before you get a grant decision, your application is at risk of rejection, as you are deemed not to ‘need’ the grant.
10. Assuming you are successful, you can only claim your grant award once you have incurred the project expenditure, and proved it to the satisfaction of the grant authority. Can your cash flow cope until you receive your claim?
Do not be put off!
Please do not let this put you off applying for a business grant! Based on my practical experience in running a business, I work with a range of micros and SMEs, helping them with practical, hands-on help and advice, including planning, forecasting and preparing them to access finance, and this includes business grants. My clients often tell me how much value and knowledge they gain about their businesses as we work closely together on a grant application process. So, yes, grants can be a helping hand! If you would like to explore whether a grant could help you grow your business, please give me a call on 07774 548822 or email me at Ralph@drs-business-solutions.co.uk.