Grants are almost a secret capital market. They are a major source of free money but most of industry...
It is not hard to see why. Information about them has long been fragmented and confusing; most people have little idea where to start looking.
This may be a capital market worth about £5 billion a year, but it is one largely without a sales force or coherent marketing strategy. That is why Patricia Hewitt, the new secretary of state at the Department of Trade and Industry, has ordered a review to improve efficiency.
It is long overdue: grants are part of any country's competitiveness strategy. Some business people shy away from them because they think grants are there only to address market failure or prop up lame ducks.
This is true in some industrial closure areas and other economically lagging parts of the country, but many grants are for promoting efficiency, for encouraging innovation, and for helping businesses to export their goods and services. They are worth going for. At the end of the day, this is free money.
Nearly all grants derive from the European Union, the Government, local councils and charitable trusts. They are disbursed rather than "sold", which means that policy is usually more reactive than proactive. There have been advertising campaigns, but with only 7% of businesses using grants, these can hardly be said to be a roaring success.
The structure of the grants market is part of the problem. There are more than 700 grant administrators in government departments, local authorities, quangos and public sector agencies with powers delegated by Government. There are about 1,500 grant schemes that with regional and local variations, cascade into nearly 4,000 capital grants for business.
To ensure consistency, there are rules and red tape. Many businesses fear wasting time on applications that may fail, so they turn to specialised consultants for help.
There are many good ones about - and a number of cowboys. Some consultants work for large accountancy firms, others on a contingency basis, taking a proportion of monies raised. Cowboys usually charge a lot up-front and may or may not deliver useful information and advice. Some have even been gaoled for conning the companies they promised to help. These latter, however, have given the whole sector a bad name.
Then there is the Business Link network. This has been slimmed down and muscled up this year.
There are some excellent advisers on grants in the network and there will usually be a fee to pay for a search to be made. Many consultants and advisers use commercially developed databases for which they themselves have to pay, so there is a charge to pass on to the grant seeker.
Since last January, however, it has been possible start the grant search process from your own desk, free-of-charge online, and with no training of specialised knowledge of the sector.
There have long been some websites where you have to pay to get into a database, but this year saw the start of a new approach when www.j4b.co.uk was launched.
This is free to the grant seeker, who can find a grant and email the grant administrator online to see if it is likely to apply to them.
The search works initially from your postcode. A series of drop-down boxes then prompt for industrial or commercial sector, type of business and grant purpose. In seconds you get a list back of every grant in j4b's database that might apply.
In June, the company behind the idea launched j4b Professional, a password-protected subscription service for intermediaries and business advisers. This has more powerful search and retrieval software to enable fast, multiple inquires to be made. The company has also started offering a "white label" product, so that agencies, business links, advisers and consultants can install a grant search facility on their own websites under their own banners, powered by j4b.
The free-to-user, user-friendly service has, however, caught the public imagination through widespread media exposure of j4b's start-up and rapid growth.
With such raised general awareness of the grants sector, thousands of businesses are now emailing grants providers and administrators directly. Many may still need professional help to negotiate red tape and make sure any rules are met, but the daunting morass of data and grants of yesteryear is now no more.
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