Applying for small business grants in the UK: 7 steps to success

You may be wondering how to apply for a business grant. Receiving a grant can be a great confidence boost, easing the financial pressure of running your business. Applying for grants in the UK can be increasingly competitive, so it’s best to be prepared. There are various business grants available from both the private sector and the government.

Before you start to apply for a business grant, you will need to be sure that you:

  • Understand the needs and requirements of the contract awarding body
  • Know your business including its strengths and weaknesses
  • Are clear about why and who you are writing the proposal for and how you intend to spend the money.

Grants can provide you with a much-needed financial subsidy. However, some may require you to match the grant amount awarded if successful. For example, if you’re given a £5,000 grant, you may also need to invest £5,000. If this is the case, it will be detailed in the grant specification.

What’s the difference between a small business grant and a loan?

If you’re trying to secure funding for your business, you might have considered applying for a loan. However, if you take out a loan, you’re expected to pay this back within an agreed time frame.

Typically, you’ll be given a lump sum which will need to be repaid in instalments. An agreement will be made between the lender and your business, such as monthly repayments plus interest.

For start-ups and SMEs, the possibility of large repayments can be daunting. Especially as failing to repay the loan or breaching your arrangement in some way could lead to potential penalties.

On the other hand, a small business grant doesn’t have to be repaid. This will be a relief for start-ups and SMEs that would otherwise be faced with the financial pressure of repayments.

However, it’s important to remember that some small business grants require you to match the awarded amount if successful. So, when you apply for business grants in the UK, you need to bear this in mind. If you aren’t prepared to invest that amount, this will impact the grants you can apply for.

What type of grants are available to small businesses in the UK?

There are plenty of grants and funding opportunities available in the UK. Ranging from cash grants for small businesses to funding for start-ups to SMEs to the self-employed.

Not only that, but there are grants and funding opportunities available across many different business sectors.

Grants and funding for start-ups

If you want to apply for a business grant as a start-up, there are different opportunities available for you. These include:

  1. Direct grants

Direct grants are the most well-known type of funding available for start-up businesses. With a direct grant, a cash award is awarded to a business for a specific project, idea or initiative.

For most direct grants, you’ll be required to match the grant amount yourself. For example, if you’re awarded £5,000, you’ll be expected to invest £5,000 of your own money. There are also regulations in place to dictate how your business spends the money.

  1. Resource and training grants

Before you apply for a business grant, you might also be interested in resource and training grants.

Start-up businesses often find themselves unable to afford certain resources or training programmes that are needed to develop certain projects. For example, you might require a particular level of expertise or access to publicly owned facilities.

Luckily for you, there are grants and funding opportunities available to help businesses in this position. For example:

  • Innovation vouchers. With this grant, the government can offer up to £5,000 for you to enlist the help of an external expert.
  • Local advice and support. Across the UK, local authorities run their own business support grants. These grants offer financial support, as well as advice, workshops and training.

  1. Tax relief

For many new businesses, the cost of taxes can be debilitating. To combat this, the government has introduced a number of schemes, such as:

  • Business rates relief. You’re eligible for this funding if your business only occupies one property. In addition, the rateable value of the property must be less than £15,000.
  • Employment allowance. With this funding, you are able to reduce your national insurance contributions by up to £3,000 a year.
  • Corporation tax relief. This funding is available to start-ups that are investing in a research and development project.

Grants and funding for particular entrepreneurs

As well as grants for start-ups, there are also grants for particular entrepreneurs. If you want to apply for a business grant, you might be interested in one of these:

  1. Business grants for women

As male-owned businesses are more likely to attract funding, more grants are being aimed at women in business. This gives women in business more opportunities to succeed.

  1. Grants for young people

Awarding bodies are keen to support young people in business. These grants often offer financial support and mentoring to entrepreneurs aged 18 – 30.

  1. Business grants for social entrepreneurs

For those starting a social enterprise or charity, this type of grant will interest you. Awarding bodies offer funding to businesses that will positively impact society, such as charities.

  1. Grants for unemployed entrepreneurs

The government started this funding scheme for entrepreneurs claiming Jobseekers Allowance, Employment and Support Allowance, or Income Support. The aim of this type of grant is to fund their business initiatives.

  1. Business grants for bad credit

Generally, your credit score won’t impact your ability to apply for grants or funding opportunities. In fact, government bodies will want to boost the economy through supporting SMEs with their business growth. For that reason, there are business grants out there specifically for entrepreneurs with a poor credit history.

However, it’s important to note that many awarding bodies will expect you to match the funding they give you. This is something to bear in mind if you want to apply for a business grant of this type.

Where can you find grants and funding opportunities for your business?

Finding grants and funding opportunities for your business can be tricky. Not to mention, time-consuming! That’s why we’ve decided to simplify the process, making it easier for your business to find relevant grants and funding.

Our Grant Tracking Service hosts all business grant and funding opportunities for UK businesses. Our team manually track grants from over 1,500 data points. Once they’ve identified an opportunity, they upload each one to our Discover Grants platform.

Then, you can filter the results by keyword, sector or price. Making it easy to find the perfect grant for your business.

Do you want to know the best part? It’s completely free! To gain access to over 1,700 business grants and funding opportunities, all you have to do is register your details.

Why should you apply for a business grant in the UK?

Before you apply for a business grant, you might be wondering how it will benefit your business. Especially if you’re a start-up business or SME.

Here are four advantages to applying for a business grant in the UK:

  1. You don’t have to repay the grant

One of the most attractive advantages of applying for a business grant is that they don’t have to be repaid. This will place your business in a much better financial position than if you applied for a loan.

  1. It increases your chances of success in the future

If you apply for a business grant and are successful, the funder views you as a reliable candidate. Basically, this means that you’re more likely to be awarded business grants in the future. This is because other organisations will trust that your company is worthy of the funding.

  1. Winning a grant increases your credibility

Depending on the business grant that you apply for, winning a grant could increase your credibility. This is because organisations and stakeholders will believe that your work is worth investing in.

It could also increase your credibility among existing clients and future leads too. Winning a small business grant suggests that your goods and/or services are worth it.

  1. Grants help you expand your business

We already know that a small business grant will benefit your business financially. But did you know that when you apply for a business grant, the grant can help you expand your business?

Funders often want to see particular initiatives or ideas in your application. To meet their specifications, you might need to develop areas of your business that you might not have considered before. Not only will this increase your chances of success, but it can encourage your business to explore new angles.

How to apply for a business grant in 7 steps:

  1. Get in touch with the grant awarding body

When thinking about applying for grants in the UK, you should first contact the grant awarding body. You will be able to get a better idea of your chances of submitting a successful application. This is also a good opportunity to go over any aspects of the specification you’re unsure of. If you have any additional questions once you’ve read over the specification, this is a good opportunity to ask. They’ll likely be more than happy to answer any questions or provide you with more information.

When you apply for a business grant, try and secure a contact at the awarding body. Securing will benefit you should there be any problems with your application. For example, if your grant application doesn’t seem to be progressing, you can call your contact for advice.

  1. Read the grant specification and objectives

Reading the grant specification and objective properly is an important step when applying for UK grants. You should be taking the time to understand why this fund is being awarded and what it aims to achieve. This could range from hiring staff to tackle unemployment to developing environmentally friendly, innovative solutions or training equipment. If a grant is suitable for your business, both its objectives and yours should align well.

When applying for a small business grant, you should be referencing the objectives closely throughout. This can help strengthen your proposal and increase your chance of success. Clearly signposting each objective will enable a funder to see you’re addressing each objective.

Reading the specification thoroughly can also help you check your eligibility. There may be certain qualifications or criteria that you need to have to be eligible to apply for the grant. You must establish this early on before you start applying or planning your response if you’re eligible to apply.

  1. Start planning and applying early

It is crucial when you apply for a business grant that you have impeccable time management and planning. Completing your proposal may take weeks or even months depending on the size of the grant you’re competing for. You should take note of what grants are suitable for your business. Some are only open at certain times of the year, so it’s best to put the date in your diary. You could plan backwards to ensure you have enough time to formulate a winning bid for funding.

You should be realistic when planning and set achievable internal deadlines when applying for grants in the UK. Breaking down the grant specification can help with this. Give plenty of time and allow extra time for any unexpected delays or issues to arise. Make sure you give enough time for your co-workers to gather any information, especially for data and statistics. Having facts and stats will strengthen your response.

A helpful way to formulate a response is by using the P.E.E method:

  • Point
  • Evidence
  • Explain.

It is always better to be over-prepared, than underprepared! You could make a checklist of requirements of what’s needed for the application. For example, you could make a note of:

  • Submission deadline date and time
  • Format of the proposal
  • The number of questions that need to be address and their word or page count
  • What additional documents need to be attached
  • The number of copies required
  • How to submit (via a portal, email, hardcopy, etc).

  1. Have a flawless business plan

A business plan is an essential part of any grant funding proposal. Funders want to know who and what their money is going to be spent on. The more in-depth information you provide, the easier it is for a funder to understand how they can help. However, you should keep it clear, using short sentences and paragraphs.

Don’t assume that the funder knows anything about your business or any technicalities unless specified. This is not the time to use overly technical jargon to impress the funder. They may get frustrated with this, particularly if they are not experts in that area.

Some grants for business start-ups will include mentoring and working with you to develop a solid business plan. This can help you organise your business before applying for funding.

If you’ve already started to trade, you’ll likely need to provide examples of your business’ position and balance sheet. You should clearly explain how both you and your funders will benefit from you receiving funding. Applying for grants in the UK can be daunting and comprising a business plan can take time.

Questions to consider for your business plan:

  • What is the nature of your business?
  • What products and services do you offer?
  • Who is the target market or audience for your business?
  • Do you have any advantages or a unique selling point that your competitors do not?
  • What needs will your company fill?
  • How will you fill those needs?

For new businesses:

  • Experience and background – What led you to start this business? Where do you hope your business will go?
  • Description of the company – What does your business stand for? This is a great opportunity to make a good impression, ensuring your business sticks in the funder’s mind.
  • Research and analysis – Show that you’ve done your research. Data and facts backed by stats are an effective way to convince a funder that you mean business. Demonstrate the gap or need in the market for your offering as well as why and how it meets that. What’s your unique selling point? How will your approach be more successful than other attempts?
  • Needs and market – Describe your target market, and why you believe you will be able to provide and fulfil their needs. Not only that, but how you will do it successfully and exceed expectation.
  • Financial projections – Ideally, you’ll include your financial projections once you’ve analysed the market, setting clear objectives.

For existing businesses:

  • Information about the company – Basic information such as when the business was founded, by whom, how many employees and where you’re located.
  • The business’ mission statement – Explain what your company is about. What difference would you like to make to your community/problem? What are your short and long-term goals? What do you stand for?
  • Highlights – How has your company grown? You could include market and financial highlights and other measurables.
  • Products and services offered – What does your company offer in terms of services and products?
  • Financial information – You could include your current investors and financial position
  • Plans for the future – what are your business projections and where do you see it going in the next several years?

  1. Focus on grant use – what will the grant be spent on?

There’s a wide array of grants available across an extensive range of sectors. For example, there are grants for fisheries and seafood, green funding for trucks and busses and research and development. Additionally, there are cash grants for small businesses that will only contribute to some equipment expenses or broadband installations, for example. You should clearly detail within your application how you will use the funding, providing breakdown costs. You should also demonstrate how it will help grow your business and benefit others.

Justify your expenses

Provide a full justification for all expenses, but don’t take advantage or over project. For example, don’t say you need 20 Apple Macs when a computer of a cheaper make and model will suffice. Do the research and back it up with evidence. When you apply for small business grants, having a high-cost projection can lose you the grant. It can be seen as profiteering. It would be a shame to lose out on funding because you thought you could ‘get away with it’.

In the same light, don’t underquote your needs. It may result in a win, but you might not be able to deliver on your proposal. Depending on why and what grant you’re applying for, this could have a knock-on effect on your project or business. Although underquoting may appeal to a funder, asking for additional funding at a later stage might not go down well. This could be playing with fire, damaging your reputation and your relationship with the funder.

Ensure that the grant benefits are tangible, measurable and benefit a wide spectrum of your community. Moreover, how they will benefit your business and the positive knock-on effects from that as a result.

  1. Double-check your finances

Funders want to know that their money is in safe hands. They want to be assured that you aren’t going to waste your money on unnecessary things. They’ll be expecting you to demonstrate sound financial management, and you should realistically evaluate your running costs. You should exhibit good value for money.

Including past examples of projects when you’ve managed cash flow successfully can help strengthen your capabilities. When you apply for a business grant, you may want to realistically consider the following running costs:

  • A fully costed project
  • The financial controls and safeguards you have in place
  • A business plan for the implementation of the project or funding
  • The degree of financial knowledge and skills within your organisation
  • A cash flow analysis for the use of the grant
  • A previous annual report
  • Your company’s annual income and expenditure.

  1. If unsuccessful, ask for feedback and try again

It can take a while to be successful with grant funding and bear in mind that it can take a while to hear back. Especially when you are applying to a large funding opportunity. However, applying for grants in the UK can be greatly competitive. You may not be successful with every grant application you submit and that’s only natural.

Try not to be put off or feel defeated, dust yourself off and try again. There are ways you can improve for next time. Asking for feedback from the awarding body and continue to apply for small business grants to help fuel your business. A lot of successful companies have faced rejection and unsuccessful attempts at funding before they succeed.

Persistence pays off at the end of the day. Ensuring that you have a lot of grant applications on the go can increase your chances of success. This is because it can take a while before being successful with receiving grant funding.

A grant writing consultant can help optimise your grant application efforts. They are experts in grant proposal writing and know what funders are looking for and how to best convey it. Outsourcing your grant proposal can help.

So, now you know how to apply for a business grant. This 7-step plan should get you on the path to success when it comes to applying for grants in the UK. Don’t give up and remember that your perseverance will pay off.

Tips for success: How to write a successful grant application

So far, we’ve covered the different types of grants available, and the stages required to apply for one. Now, it’s time to look at how to write a successful grant application. If you’re going to apply for a business grant, try these tips for success:

  1. Tell the truth

When you apply for a business grant, it’s important that you tell the truth in your application. As we’ve already established, funders expect you to outline exactly how you will spend the grant on your business. If you lie about how you will spend the funding, you will struggle should you be awarded the grant.

If you aren’t telling the truth at any point in your proposal, you should find another grant for your business.

  1. Do your research

To increase your chances of success, it’s important that you do your research before you start your funding proposal. The funder will be expecting you to research more about them and their background before you submit your application.

This is especially important for grants at a higher price point, as these will be more competitive. So, you need to make sure that your application stands out. Researching the funder will help you do this, as you will learn more about their expectations.

It also gives you the opportunity to make sure that the grant is right for you. If you don’t think you’re what they’re looking for, applying for the grant could be a waste of time.

  1. Give yourself plenty of time

To apply for a business grant and win, you need to give yourself plenty of time. Depending on the funding opportunity at hand, producing your proposal could take weeks, or even months.

Remember, deadlines for grant applications are final – the funder won’t accept a late submission. So, it’s vital that you manage your time efficiently throughout the grant writing process.

To help you do this, you should take the following into account:

  • The first draft
  • Rewrites
  • Proofreads
  • A secondary read
  • Technology malfunctions
  • Any unexpected delays or setbacks.

By giving yourself plenty of time, you can avoid submitting the application at the last minute. Portals can be temperamental, and you don’t want to risk missing the submission deadline because of a technology malfunction.

This is especially important if the funding is awarded on a first-come, first-serve basis. If that’s the case, submitting your application early will increase your chances of success.

  1. Adjust your writing style to suit the grant

If you want to apply for a business grant and win, this next tip is really important. When writing your grant application, you need to adjust your writing style to suit the funding opportunity at hand.

For example, a grant proposal for charity funding will be completely different to that of a business grant. The charity funding will require emotive language and heartfelt examples. This is because you want to pull on the heartstrings of the funder, as this will increase your chances.

On the other hand, a proposal for a business grant will need to focus on the outcomes of your business. In this case, you’ll need to keep the proposal business-centric, focusing on your projects and initiatives.

  1. Pay attention to the details

Finally, when you apply for a business grant, you need to pay attention to every detail. This is particularly important when it comes to writing your application.

There’s a good chance that the funder won’t be a specialist in your area. So, to ensure that they know exactly what you’re talking about, you should explore every detail of your idea. It’s helpful to use laymen’s terms to make sure that you cover all bases. This will help the awarding body understand your application.

You also need to pay attention to every detail to ensure your proposal is completely free of errors. The funder won’t be impressed if you submit an application full of spelling and grammatical mistakes. It looks lazy and unprofessional. Thoroughly proofing your proposal will prevent this, and increase your chances of securing the funding.

Need help with writing your grant application?

Our Grant Writing Service is for businesses who want to start applying for grants, but don’t know where to begin. If you don’t have the resources or the time in-house to write a winning grant – we can help. Our Bid Writers have over 60 years of experience in bidding for funding and grants. They can take care of the whole thing for you – they’ll even submit it on your behalf.

Get in touch to find out how we can help your business grow!

Grant Tracker

You can find this grant and others like it on our Business Grant Tracker. Currently, we have over 1,770 live business grant and funding opportunities. Our team have manually tracked 1,500+ data streams searching for business grant opportunities. Each one is then uploaded to one central system, streamlining the process.

All you need to do to gain access is sign up for free.

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