Free Government Grants for Small Business
Small businesses are essential for stimulating the economy. To help businesses start or expand, the government awards grants that do not have to be repaid. The application process for government grants can be long, but the free money can help cut out-of-pocket expenses the small businesses encounter. All businesses that meet eligibility requirements are encouraged to apply for free government grants.
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Size
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Before a small business can apply for a small business government grant, the business must ensure that it meets the size and annual income requirements for the "small business" classification. The type of small business determines what the standards are. For instance, a small manufacturing and mining business is considered a small business as long as it has fewer than 500 employees, but a small wholesale trade business consists of fewer than 100 employees. A few federal, state and local government agencies may make exceptions to the standards, but they are not guaranteed.
Registration Process
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Small businesses must register their business prior to applying for grants. The registration process could take as little as three days or as long as five weeks. Before a small business can register with the government to apply for grants, the business needs to obtain a DUNS number from Dun and Bradstreet and register with Central Contractor Registration. This process allows the government to verify the business's identity. The government also verifies that the small business representative applying for the grant is authorized to do so. All applicants must be legal U.S. citizens who are at least 18 years old.
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Consideration
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Government agencies require small businesses applying for grants to produce business proposals. The purpose of the proposal is to outline the details of the business, including products or services that will be offered, but more importantly to describe how the grant money being applied for will be used if the business receives it. Writing a business proposal can be complicated. A small business owner should consider contacting the local Small Business Administration office for assistance developing a well-structured business proposal.
Factors
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The ownership behind a small business can be a huge factor in applications for government grants. The government awards grants to owners who are women, minorities, individuals with disabilities or single parents or who demonstrate other specific personal characteristics. For example, the Office of Public Health and Science awards $300,000 to small businesses providing education about HIV/AIDS to women.
Types
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Government agencies categorize government grants by the type of service a small business provides or the type of products it sells. Some categories include transportation, health, criminal justice, and food and nutrition. For instance, a business that performs high-tech research may apply for money from the National Science Foundation, which awards $100,000 to businesses that conduct long-term integrative research. The location of the business can also determine what type of grants it can apply for. For example, a small business that provides care to patients in underserved areas may be eligible for a Service Area Competitions grant.
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