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Looking for Grants ?

When growing an existing business or thinking of starting one, a major consideration is finance.  

Grant funding can help your business to develop and grow, however, finding out about the grants that may be available to your business can be a daunting task.  There are hundreds of different schemes in operation at any one time, many new schemes appearing and others disappearing as time goes on.  Grants may be available from many different sources - central and local government agencies, charitable foundations and private sector bodies.

Key Considerations
Main Types of Grant assistance and Support
Eligibility for grants
Types of projects that  can secure  grants  
Awarding Bodies
Identifying Possible Grants

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Key Considerations

1)     Gradual business development does not normally qualify a company for grant assistance. Grants are usually only available for specified projects.

2)     It is very rare for a grant to finance 100% of the costs associated with any project.  Most schemes require your business to put up a proportion of the cost, with ‘matched funding’ (50%) being typical.

3)     You must be able to demonstrate the importance of the project to your company’s overall strategy.  Your business plan may need to be altered to place emphasis on the specific project concerned.

4)     Each grant awarding body has its own specific remit and objectives, for example, improving skill levels in a certain industry.  As such, grant schemes almost always impose restrictions, according to a number of different factors.  The project must help towards achieving the objectives of the grant provider.

The Main Types of Grant assistance and Support

Direct Grant	This is a cash injection which may be offered for projects such as training, export development or capital investment projects.  Direct grants typically cover 15-50% of the total finance required for a project.
Repayable Grant	Cash funding is offered for a project with the intention that the grant is repaid from future revenues.  The grant is not repayable should the project fail.
Soft Loan	A loan with generous, ‘softer’, terms and conditions of repayment.  The loan may be interest free, or the repayment term may be longer.
Equity Finance	A capital sum is invested in the company, with the fund provider taking an equity share of the business in return.
Free / subsidised consultancy	Schemes that pay in whole or in part, the fees of accredited consultants who possess the skills that the organisation lacks.
Technology Transfer	Technological advances usually come from larger commercial, academic or public sector organisations.  Some support schemes may aim to accelerate the transfer of these technologies to small & medium sized enterprises (SME’s), companies of 1-250 employees.
Packaged Assistance	Assistance is not always delivered through a single support vehicle to the exclusion of the others.  Often a scheme will incorporate several methods of assistance, tailored to the recipient’s requirements.

Eligibility for grants

Whether your business qualifies for grant support is likely to depend on the following criteria:

a) Location:  Your business may have to be located within a specified area to be eligible for assistance.   Since these areas are designated by the grant awarding bodies themselves, and may well differ from each other, it is necessary to consult the particular awarding body to ascertain if your business falls within their target area.  

For example, a business may be eligible for special grant support if that business is located in an economically depressed area, especially one with high unemployment.  Redditch is not considered to be economically depressed, therefore there is no special funding on offer.  However, Business Link can provide advice on the schemes in place available to Redditch businesses, designed to help combat specific local problems.

b) Industry or sector:  Some grant schemes may have been developed to tackle particular problems affecting a specific industry or sector.  It is important to note that not every type of business will be eligible for every grant available in a particular area, and that it is common for retail businesses to be ineligible for financial assistance of this nature.

c) Size: Many grants are only available to small and medium sized enterprises (SME’s), companies with fewer than 250 employees.  Other schemes may restrict applications to businesses employing less than 50, 20, or even 10 employees.  Much government support is aimed at growing businesses rather than ‘one-man bands’.

Types of projects that businesses can secure grants for  

Grants generally focus on supporting specific projects such as:

• Training and skills development
• Research & development
• Improving manufacturing methods
• Reducing negative environmental impact
• Marketing
• Design
• Exporting
• Technology transfer
• New business start ups
• Crafts
• Tourism

Awarding Bodies

Awarding bodies of grants and support are of European, national, or regional/local origin.

European:  The European Commission is the main source of funds provided by the EU.  Grants are usually not available directly to businesses. Instead, the European Commission provides finance to local or regional grant administering bodies via its four Structural Funds:

• European Regional Development Fund (ERDF)
• European Social Fund (ESF)
• European Agricultural Guidance and Guarantee Fund
• Financial Instrument for Fisheries Guidance (FIFG)

However, the Commission does give some grants direct to recipients (public or private bodies - universities, firms, interest groups, non-Governmental organisations - and private individuals in certain cases) for the implementation of other common policies in areas such as research and development, education, training, the environment, consumer protection and information.

National:  Nationally, grants are available from various Government departments and agencies, such as: Department of Trade and Industry (DTI); The Department for Education and Skills; The Countryside Agency; Trade Partners UK;  and the Department for Environment, Food and Rural Affairs (DEFRA).  Grants are also available from organisations such as the Crafts Council and the Arts Council.  

Trade Partners UK provides support to companies to undertake export marketing research, the scheme is managed by the British Chambers of Commerce.

The Prince’s Trust is particularly active in the area of business start-ups, providing grants and loans to 18-30 year old entrepreneurs who have been unable to raise finance elsewhere.

Regional & Local Awarding Bodies: Regional and local awarding bodies include: Advantage West Midlands (the Regional Development Agency for the West Midlands); Chambers of Commerce; and the Learning and Skills Council (LSC)

Government Office for the West Midlands no longer administers grants for Business Development on behalf of the Department for Trade & Industry. This area of work has now been transferred to Advantage West Midlands.

Identifying Possible Grants

If you are looking to find out what grant funding and support is available in your area, the best place to start is Business Link.  Business Link West Midlands will have a directory of assistance available on a local, national and European level, its advisers will be able to put you in touch with the relevant grant awarding bodies and will be able to help you through the application process.

Alternatively, there are several websites that can be searched, a selection of which are listed below.  It should be noted that although these sites provide details of a comprehensive range of grants available, there may be other grants available that are not listed.    

Details of specific European grants and loans available are given on Europa, the official site for the European Union.

The West Midlands Access to Finance site has been developed by Advantage West Midlands to raise awareness of the different types of finance available to small and medium sized enterprises and includes a searchable database of grants on offer.

The Application Process

Once a scheme has been identified, a proposal must be submitted detailing a thorough description of your project.

· Always contact the grant provider before pursuing any application, to ensure that your project meets the specified criteria of the scheme.   

· A detailed business plan, emphasising the project as the cornerstone of your business development, will form the basis of your application.

· The assistance of a Business Link adviser or accountant to help you with your application may be sought.

· Ensure that your application clearly explains how the project meets the objectives of the awarding body, including a work plan and relevant costing.

· Make sure you can prove that you have a genuine need for a grant – and that without the grant the project would be unable to proceed.

·  If your business will need to contribute to the cost of the project, ensure the necessary funding is in place.