A grant is a sum of money that is given to you or your business.
Who gives them?
Business grants are awarded by central and local government, the European Union, and a number of other bodies. They are designed to implement policy - and in the main support economic development and regeneration.
Information about them is available from a multitude of different organisations. Some provide the funds, some just information. Grant schemes are always changing and being updated to reflect new priorities and initiatives. The result can be information chaos for the small business - which is why Open 4 Business can help you make a first step.
How can I get one?
Use Open 4 Business to explore the types of schemes available and to point you in the direction of the actual grant administrators. You should contact the administrators to check your eligibility and see whether they advise you to make an application.
How do I find out if my business is eligible?
Your business will need to satisfy certain criteria for you to be eligible for any particular scheme.
Does where I'm located matter?
Many grants are location specific. There are several schemes that operate nationwide, but in addition to these there are a myriad of schemes that are administered locally. The location of your business will be crucial, and funding that might be available to you will be strongly dependent on the area into which you intend to grow or develop. Additional support may be available to a business investing in or into an area of social deprivation, particularly if it involves sustainable job creation.
Is my industry sector significant?
Yes, very much so. Funding schemes will be allocated towards the development of particular industry sectors, so what grant you get will depend on what sector your business operates in.
Presumably I can do what I like with the money?
No. Grants are in the main available for specific purposes: for example exporting, relocation costs or perhaps investment in plant and machinery. Open 4 Business organises schemes into these distinct purposes, so you can easily view the ones that match your area of activity.
In order to benefit from funding, your business and your project will usually have to satisfy extra criteria in addition to being located in a particular area and to operating within a certain industry sector. This could range from having to have been trading for less than 18 months to be eligible, to restrictions on what suppliers might be used with a specific project.
How long does it take?
Is it quick?
Sometimes, but on the whole be prepared to be patient. Once a proposal is submitted it can take a while for decisions to be made. Smaller, local schemes may be passed through and decisions made quickly, but for more extensive applications to national funds the application process may take several months. The same applies with European funding, where applications can take up to a year to be completed.
How do I take the next step?
Try to talk to the administrators before doing too much work. Open 4 Business points you in the direction of the administrators themselves, along with the organisations that might be able to help you apply.
Personal contact is very important, and because the application process is sometimes bureaucratic, try and get someone on your side. In addition, knowing what the grant scheme aims to achieve, and what kind of companies have previously been successful in applying can help make more successful applications.
Proposal submission is a vital part of the grant application process, and the success of your written application will depend very much on how well constructed your business case is. Detailed project descriptions, clear analysis of the local economic benefits of the scheme and a well-constructed business plan are key features of a successful proposal.
What will a grant pay for?
Will it pay for anything I want?
No. Funding will usually relate to a specific project. This could be a relocation, the development of a new product, the investigation of a new export market, etc. With some grants the project must become viable within a certain timeframe. The project plan will need to be well defined, with identifiable deliverables. It is likely that a well-constructed business plan will be an important part of the proposal. In some cases you may need to show that without the grant funding the project would not go ahead.
Will it pay for the whole project?
One of the strings attached to a grant is that you'll have to put up some of your own money. It's rare for a grant to cover more than 50% of the cost of a particular venture. In most cases between 15% and 50% will be offered. That means that you will need to find half of the cost of your project yourself... either through your own capital, a bank loan, or possibility work-in-kind.
When will I get paid?
Payment is often done according to a schedule, either at regular intervals throughout a project, or in arrears, upon submission of proof of expenditure. Even though you might have received the grant in principle, you may have to make arrangements to finance the project until the grant is actually paid.
Will I have to pay it back?
Not usually. Be wary though - grants have often been called free money, but they're not. Bear in mind that there will be time and effort involved in applying for grants. There is no interest to be paid and funds are not usually returnable - as long as the terms of the grant are met.