You Can Access Government Grants, You Just Have To Understand The Game
by Business Money Today - December 7, 2009
Government grants, or any grants for that matter, are probably one of the most sought after resource by business owners.
Grants are essentially free business capital (money that does not have to be paid back) and, if acquired, can go along way in providing needed resources to help businesses with immediate cash flow issues or to attract and win new business.
But, these grants, especially government grants, are extremely hard to get unless your business is tax exempt or a non-profit organization.
You hear this from nearly every expert or official on the planet - from Business.gov to SCORE and even from the Small Business Administration (SBA). They constantly state that there are no grants programs (government or otherwise) for 'for-profit' businesses - the government (federal, state or local) does not provide grants directly to businesses to either start-up or cover operating expenses.
And, for the most part this is very true. The government (any government entity) does not usually provide grant funds directly to businesses. But, businesses can access these funds in an indirect manner as most grant funding is allocated to government entities and departments (federal, state and local) for distribution within their local areas.
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Take an example from the federal transportation grants as part of the recent stimulus package. Let's say your city wants to purchase new buses for public transportation. Your city can apply for these stimulus grants to get the funding to purchase the new buses. The federal government agrees with your city and prepares to send the funding but stipulates that any purchase with these funds have to comply with the new emission standards - meaning the buses have to be green.
Now, when your city receives the grant funds, it has to go to a non-government company to purchase the buses as no government entity manufactures buses. Your city officials will request bids from local and national transportation manufacturers outlining the emission standards that need to be met as well as their process for accepting bids.
If your company can meet those standards and win the bid, your company will essentially indirectly access those federal grant funds.
Keep in mind that your city, county, state or even federal government departments use grant funds to make all types of purchases from durables goods like buses, computers and office furniture to services like building construction, road maintenance and in-house child care; just to name a few. In fact, these government entities make all types of purchases from for-profit, non-governmental business organizations to include landscaping, window washing and even commercial cleaning - again, just to name a very few.
To find out what type of programs your local and state governments are requesting bids for, simply call your mayor's office, county administration offices, state governor's office or visit your local chamber of commerce and ask about their community development grant or other grant programs. All of these groups can point you to the right information for your local or state area. For federal opportunities, simply visit Grants.gov or look into Small Business Innovation Research (SBIR) or Small Business Technology Transfer (STTR) grant programs at SBIR.gov.
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You Can Access Government Grants, You Just Have To Understand The Game - Business Money Today