Even in these troubled economic times, there are so many grants available to small businesses, some local, some regional, some national. Currently the Government website lists 150 different schemes for business support, offering finance, advice, or grants. Applying for these schemes can be a laborious process though, and success is not guaranteed. So choosing the right one is vital.
Find a grant that works for your business: https://www.gov.uk/business-finance-support
Step 1: Identify the right grant
Would your business benefit from an injection of cash? If so how much? And how much can you afford to pay back? Would you prefer a package of advice and support? Every business is different. Most schemes also require you to supply at least 50% of the capital towards the project you are funding, so that you are invested in the scheme as much as they are. So you have to plan properly, and make sure the funding will go towards a successful project, whether it is a new business or an expansion.
Step 2: What can you give in return?
Currently, business grants and schemes follow three themes:
If you can show your capital will go towards reducing the carbon footprint of your business, there are significant grants available. If you can supply a portion of the capital, and prove it is being invested in a carbon reduction project, you can make a huge saving on your investment.
Many grants and loans, particularly local schemes, are intended to help businesses employ more people, and to shorten their dole queues. This is a win-win if you can find the right people and have an opportunity to put their skills to good use.
New business support
If you are creating a start-up business, the best options are the government start-up loans. These currently have a 6% repayment rate, which is lower than the rate of inflation, meaning the government is virtually giving away money to help you start your business! However, a viable, sustainable business plan and a personal responsibility for the finance is a pre-requisite. Your business doesn’t even have to be that new. You can apply for a start-up loan if your business has been running less than 3 years.
Step 3: Putting together a plan
You will need to show the body that runs the scheme that you are sincere and honest in your application. If the application is for a start-up, a detailed business plan, with financial projections, costs, and expected revenues, is mandatory. If the scheme is environmental, showing energy usage reductions and how you are going to minimise carbon emissions will be the deciding factor as to whether you are awarded your grant. Each grant, and each panel that awards the grant is different, so failure in an application for one grant does not necessarily mean you will not be successful elsewhere.
How much can you get?
Government-backed start-up loans range from £500-£25,000, although there are usually local options, which offer more. Almost all loans require a detailed business plan, and the grants also require additional capital to be supplied by yourself, to demonstrate your commitment to the project mooted. However, for certain projects, involving restoring historic buildings, or for job creation, you can access funding in the millions.
It's not just about money
There are also a range of superb support schemes, which offer impartial and intelligent business advice. These schemes can often be more valuable than the financial support available. As they are government-backed themselves, they will know all the avenues of support accessible to you inside-out. We also have a variety of small business guidance here at DotGO, with news and advice on business growth.
The paradox of government grants and loans is that of you need one, it is often too late to apply! Most of these awards are not here to help a business that is struggling. Having available capital to match a grant award, or a sound business plan to back up a loan, is the most important asset in your application. There are many templates available online for making a business plan, and these often come with guidance for making your plan as realistic and attractive to investors as possible.
If you have considered all risks, and have a well thought-out strategy, you may not even need a grant to be successful!
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