Startups and small business ventures make the backbone of any economy, and the UK is not an exception. According to government statistics for 2021, SMEs (small and medium-sized enterprises) accounted for 99.2% of the total number of businesses in the country. However, these organizations can struggle to expand their operations or even stay afloat for several years after they are launched. Due to their nature, they are often far more susceptible to negative industry trends and worsening economic conditions.
After all, startups and small companies are highly unlikely to have the cash reserves needed to fund their operations during a slow period. At the same time, even profitable operations could find themselves unable to meet their debt payments due to poor cash flow management, leaving them without sufficient liquid funds to cover their short-term needs. One often overlooked financing method that will not straddle the company with additional debt is seeking a small business grant.
However, it is crucial for any small-scale business to be aware of all available types of financing. More importantly, they will need to understand the pros and cons of the different funding methods and pick the best one based on their current state and circumstances. Consulting with professional financial experts or small business accounts such as Howlader & co could provide valuable insight on what is the best approach to securing a much-needed financial boost. With the help of the experts, companies may implement better cash-flow management or learn how to control their expenditures.
What Is A Business Grant?
Business grants are typically government programs aimed at providing businesses with funds for either general purposes such as starting a business in the first place or achieving a more concrete goal – helping companies operating in a specific niche, supplying the capital needed for a business plan, allowing companies to explore certain business opportunities, and more. Grants can also be offered by public or private sector organizations. To secure a small business grant, applying businesses must meet all of the requirements of the chosen scheme. Many grants may exclude companies based on niche, industry sector, business plan, location of operations, financial state, turnover rate, etc. Exploring all available financial support schemes could help companies identify the grant program that best corresponds to their current goals and needs.
Advantages And Disadvantages
The main advantage that may attract businesses to seek grant funding is that the money received via these programs do not have to be repaid. In short, startups and SMEs could receive a cash injection towards reaching a specific operational goal without having to rely on more traditional debt financing options. Being approved for a grant is also a significant boost in confidence. The operators of the grant scheme show publicly that they are endorsing the chosen company and its business plan – a fact that could be used as a great promotional tool.
Small business grants are an enticing option, but there are only so many schemes available. Naturally, this results in fierce competition between applicants, and successful approval is far from guaranteed. Furthermore, candidates must meet strict qualification criteria, and each scheme has its own requirements. Another essential factor is that many grants cover only a portion of the costs, and it is up to the company to procure the rest.
How To Apply
The first step when seeking grant funding should always be to check to qualification criteria and not waste time applying for schemes that you are not eligible for. Second, check the specifics of the chosen scheme. Many grants have clear objectives that may not always align with your company’s plans or needs. Don’t rush the process. Request the grant application pack in advance and make sure that there is plenty of time before any deadlines. Ideally, you would want to have sufficient time to compile and provide all necessary information in order to submit as perfect an application as possible.
To bolster your case, it may be wise to provide solid evidence for any claims or projections made in the application form. Keep in mind that you will need to show that you are the best possible candidate among all the other businesses competing for the same grant. Another smart move might be to hire a consultant or an expert in the field. The knowledge and experience they provide could prove invaluable when applying for grants delivering larger sums or ones that have a more complex application process.