Every new business needs finance when they are first starting up. You will need to buy equipment and your workplace will need to be set up as well as all of your marketing costs being sorted out but it doesn’t just stop here; when you are officially set up and your business starts making money you will need to cover all of your businesses bills and your staffs wages.
When it comes to finance needed to establish your business there are a number of options available to you. One of these options is grant finance. So what exactly is this grant finance? Grant finance is some of the money that is given to individuals or businesses for a specific project or purpose.
Grant finance however only covers part of the cost involved in your business project but the money that is given to you doesn’t need to be paid back. Grants are given to businesses to help with specific aspects of business development and they are available from a wide range of sources such as the Government, European Union and regional development agencies. These business grants are only given to businesses for a specific reason and there are a number of factors that may affect whether you are able to gain a grant such as your business activity or your specific business industry sector, some are also linked to certain geographical areas, which are in need of economic regeneration.
Business grants are notoriously hard to gain and there are only a certain amount that are available to businesses every year so the competition for these business grants is strong, which is why if you are hoping to gain one you need to clearly outline what the grant will be used for and how it will benefit your business as well as how it will benefit your local community. You will also need to clearly show that the specific project you want the money for hasn’t already started to take place and that you are able to put the rest of the money needed for your specific project to the grant money because, as mentioned earlier, a business grant only covers part of the money needed for a specific project.
A business grant will cover between 15% to 50% of the total costs involved in your business project so you will need to get hold of the rest of the money. If you gain a business grant when you don’t have the other half of the money available or you have already started the business project then you will be made to pay the grant back in full as you are breaking the terms of your business grant.
If you are hoping to make an application for a business grant then you need to make sure that you check what grants are available. Also there are a few factors that could affect you gaining a business grant such as the size of your business. Some grant providers will only give you access to a grant if your business is a small to medium business, ideally with less than 250 employees. As well as the size of your business you also have to think about your industry sector. This is because funding can often be limited and subject to restrictions in certain sectors, which are defined by the European Commission. Other restrictions include the location of your business and the purpose of your grant.
If you are going to apply for a business grant it is advised that you make your application well in advance of when your grant is needed as the applications can often take a while to process.
