Applying for a government grant
With the banks still reluctant to lend, one possible alternative source of business finance is a government grant.
The government offers a number of business grants, as do Regional Development Agencies and local authorities.
Grants are usually awarded for specific projects or uses, are often related to particular business sectors or geographic locations, and usually require matching funds from the business.
There are various types of grant; some are for business development, some for investment in plant or equipment, others for training. They come with strict terms and conditions, and, given the competition, winning one can be very tough.
That said, a business may find that applying for a grant is a considered and realistic option. If that is the case, you should plan your application carefully.
Any business that decides to apply for a government grant must first make sure that it is eligible and qualifies for the funding.
The business should also be able to demonstrate that the funds are required for a particular purpose; and it should be in a position to contribute money to the project itself.
It is always advisable to enlist the help of a professional advisor before putting together a detailed application. They will guide a business towards the most appropriate sources of funding and those that the business will have the greatest chance of success in securing.
Once a business has determined which type of grant is most suitable to its needs, it must next assemble its application.
In submitting an application, a business must fully acquaint itself with the notes issued by the grant-giving body. These will describe what the body wishes to know about the business that is making the application.
To be successful, a grant application should normally include a number of documents. There should be a comprehensive description of the project for which funding is being sought, along with details of the aims and benefits of the project.
To back up the project description, there should be a full costing plan, showing how and why the money will be spent. A business biography setting out the experience and expertise of the owners/directors, and of any key personnel, is also important. An intelligent and thought-through business plan that demonstrates how the grant will help the company develop will add a longer-term perspective to the application. And, if this is required, there should be a persuasive outline of the economic advantages the project or investment will deliver to the local area.
Those assessing the application will look for particular indicators. Among other criteria, they will want to see that there is indeed a requirement for a grant. They will want to be convinced of the expertise of the business owners. They will judge the innovation of the project. And they will evaluate its significance.
So it is vital that all the relevant information, and important support material, are presented clearly and unambiguously. As your accountants, we will be able to offer guidance and help in putting together the application so that it presents a cogent business argument.
If anything needs clarifying, a business should get in touch with the person or people who are administering the grant. Often they will be able to answer any questions or supply advice.
Where a grant is dependent on matching funds, a business should begin the process of getting its portion of the funding in place before the grant application is submitted.