Grant Proposals for Small Business: How to Get Started

When’s the last time you applied for a grant? For many small businesses, cash flow is a bigger problem than ever.  During a recession, it’s very difficult to get credit from banks, and getting paid within 30 days is no longer guaranteed–but you still have to pay expenses and salaries.

government money

One way you can reduce this financial pressure is to apply for government grants. For most of us, the idea of applying for a grant is seems like a headache. The process, paperwork and politics don’t appeal to everyone.  But getting a grant may not be as hard as you think.

Grant Proposals for Small Business: Getting Started

The difficulty in applying for a grant is knowing where to start. Instead of trying to do it all by yourself, try the following:

  • Go to local networking events. Ask around and see who has recently applied for (and won) grants. Invite them to lunch and ask them to walk you through the process. Take notes.
  • Connect with others involved in the grant development process. In many small towns, this may be the town clerk, mayor’s office or some other local governing body.
  • Most government Request for Proposals and Grants are published on the Internet. Identify the main point of contact and see if you can meet the person.
  • Contact successful grant winners. You can find out about these from the local Chamber of Commerce, procurement websites or others in the business community. Unless you’re a direct competitor, most grant recipients will be willing to share lessons learned.

Once you go through this fact-finding process, look at your options:

  • Is it worth your while to apply for these grants?
  • Do you have the skills, experience and knowledge to win the contracts?
  • Who can help you write the grant applications? Maybe you can hire a grant writer for the first bid, see how it’s done, and then write the next proposal yourself.

Let’s say you decide to go ahead. What happens next?

Grant Proposals for Small Business: Identify an Opportunity

You increase your chances of winning government contracts if you put yourself in the shoes of the people awarding the grants:

  • Why are they giving these grants?
  • What underlying problems are they trying to solve?
  • Why are they offering this funding now?

When you see the grant application process through their lens, you can position your proposal to address these concerns.  And remember, many of their concerns won’t be written down in black and white.  Why?  Because they may not have the time, effort or skill to document these problems.

This is the reason you need to network at local business events. The more you do so, the greater insight you’ll get into why grants are offered and how to get one.

How to Develop Your Grant Proposal

The next step is to identify a grant application or RFP that you want to complete.  What’s the difference between a grant application and an RFP?

  • A grant application is a request for funding. For example, if the local authorities have a budget of $200,000 for education-related grants, then you can apply for funding in this category.
  • An RFP is a Request For Proposal. It identifies a list of requirements and then asks you, the bidder, to propose a specific solution or service. The agency will compare bids and hopefully chose the one that offers the best value for money.

With this in mind, consider the following when writing your grant application:

  • Issue. Addresses a local or national issue (e.g. improve public safety). Be specific and focus on an area where the local community benefits.
  • Cost. Outline how much funding you require to complete the project. Be specific. If you want $24,000, then ask for it. Don’t be vague or ambiguous.
  • Duration. Estimate how long it will take to finish the project from the start date.
  • References. You’re not going to get funding without experience. Provide examples of other, similar projects and show where and how you reduced costs and improved operations.
  • Research. If you’re applying for a grant to develop a new product, service or software, then support your business case with research data and other statistics.
  • Team. Include short portraits of the team members. Explain what they contribute to the project and any special qualifications that will ensure the project’s success.

How to Improve Your Grant Success Ratio

Even though you’ve done a lot of hard work, you may not win your first grant application. There’s always a learning curve.  Instead, after the grants have been awarded, see if you can arrange a meeting with the team that awards the grants.  One angle is to ask for a little direction on how you can improve your grant application the next time. This demonstrates you’re committed to the long haul and humble enough to ask for direction.

Of course, it’s all about how you phrase the letter. Don’t come across as feeling slighted that you didn’t win or trying to question their judgment.

By cultivating a relationship with the grant team, you’ll gain a better insight into their thought processes and also understand the values that underpin their awards. Once you’ve grasped these points, you can weave them into the fabric of your next application.

See the difference?

What has been your experience when applying for small business grants? What part of the process was most difficult?

8 Comments ▼

Ivan Walsh


Ivan Walsh Ivan is the founder of Klariti, a popular website with one goal - to help you write more effectively. Every week, Ivan takes the mystery out of business writing and helps you write better reports, plans, procedures and white papers.

8 Reactions

  1. These are some very useful tools to those that are looking to get started. I have found with my clients that it is a simple as a 30 webinar showing them, gives them that “ah ha” moment. Great article.

  2. HI,
    I want to start new bussiness but I do not have safficient money for starting and Also do not have any other property for taking loan then what I m doing , how to get loan from bank

    Kindly requested that if you have any solution then pls help me

    Thank’s

    Ashvini Tiwari
    Student

  3. And I’ll go ahead and say it…after getting all the vital pieces together, be sure your grant is well written. It is a small investment to hire a capable writer if it means having a better chance at the grant.

  4. It’s good to know there are still opportunities out there for businesses with the dedication to pursue them. Thanks for the great resource!

  5. This is a well-written article, but again, what are the grant sources for small businesses? No specific sources or programs were mentioned.

    I think articles like this often lead small business people to think there’s free money out there to be had – when in fact there is not.

  6. I think people should go to their states local SBA and take the grant classes that they have or get the help of a grant writing pro

  7. I want to find out about a grant I have a green cleaning company and I invested about 10000 in already and can’t get any contracts or work how do I move ahead and get started to make money

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