Funding Small Businesses in Canada: A Situational Analysis
Small scale entrepreneurs across the globe report that obtaining financing is often the most challenging aspect when starting or expanding a business venture. When looking to finance your business, the first step should be learning about the types of small business grants Ontario offers. From there, you can, depending on the nature of your business, decide on the one that best meets your funding needs.
Grants provided by the Canadian government offer businesses support in the form of a non-repayable contribution channelled to a project. Typically, such types of grants are tied to a specific aspect of your project like capital investment, R&D, business expansion, or hiring/training. It’s also worth noting that the majority of such programs come with comprehensive processes of application and reporting to ensure transparency and compliance.
Government Grants for Small Businesses
According to a recent PwC report, nearly 50% of all Canadian small businesses are not leveraging any government sources of funding. PwC research at the same time shows that accessing funding forms a key barrier to growth in the business sector. Obtaining small business grants remainsout of reach for lots of SMEs for a several reasons—many are not aware it exists, how to access it, or they lack the time to assemble funding proposals.
According to the report from PwC, tax credits like the hugely popular SR & ED credit program remain the best used Canadian government program. About 36% of businesses make it a point to include their SR & ED claims when making their tax filings. Other than that, 48% of small businesses across Canada are not taking advantage of any form of government aided funding, like vouchers, repayable funding or grants.Nevertheless, the most popular government grants for small businesses programs in Canada is the Industry Research Assistance Program (IRAP).
Small Business Grants
A major impediment to funding is that lots of small businesses are not even aware of what is available to them. There are many small business grants Ontario that are available each coming with its own unique eligibility criteria and proposal requirements.
The best route that small business can use to leverage Canadian government funding is probably through the project-based funding approach. Several programs are available designed to support general expansion projects, training projects, and equipment implementation.
With the Canadian economy experiencing major shakeups, a changing international business environment and federal government regulations, businesses cannot afford to take anything for granted. Businesses must be ready and willing to go that extra mile to stay alive.
To access government business funding does take work. Getting grants for small businesses takes as much effort as required to secure private funding. Small businesses need to work on developing their networks and relationships with funding agencies, within agencies, and most importantly, deliver a persuasive, compelling argument why their business idea deserves getting a government grant. The Ontario Centres of Excellence website has more online resources available.