One of the most challenging part of the EDG grant application process is the actual application itself. Many people usually struggle with the projection numbers (financial and manpower) that are mandatory. I hope this post can give you a heads-up on what to expect. If you spend time preparing the right prepare documents and numbers, this submission should be effortless.
For those who do not know what is EDG, it stands for 'Enterprise Development Grant'. Unlike the Productivity Solutions Grant (PSG), this grant is not based on pre-scoped or pre-approved solutions. If you are looking at securing a higher grant support for 'larger' projects like consultancy, rebranding, customer insights, process redesign and improvement, large scale IT implementations, or even expansion overseas, then this may be a grant worth exploring (if you meet the eligibility criteria).
The maximum support can be up to 80% of qualifying cost (as of Nov 2021). Please note the key word here - Qualifying. Not everything is supported at the full 80% quantum. For example, hardware will typically get the minimal support. It would be around 10% based on my past experience. The highest quantum typically goes to consultancy, training or any form of knowledge transfer activities from the vendor to you. My experience is that if the grant can cover 45-55% of the overall project cost, that will be a good result. You can read more about the EDG here: https://www.enterprisesg.gov.sg/financial-assistance/grants/for-local-companies/enterprise-development-grant/overview
The EDG grant can be applied online at https://www.businessgrants.gov.sg/
A Corppass is required in order to login and fill up the form. You can apply for Corppass here: https://www.corppass.gov.sg/
The various sections of the application form
These are five sections to fill up. The 'Eligibility' section allows you to declare that you are eligible for the grant. Fill in the main person's contact and mailing address in the 'Contact Details' section. Typically this is the project leader or whoever you had 'arrowed' to head this project. :) Do note this person will be contacted by ESG to clarify or answer certain questions regarding this project.
Uploading your proposal
Get your business plan, excel sheet with your various projection, and the vendor's proposal & quotation ready. This is the section to submit all these. There are two parts in this 'Proposal' section.
The first part provides spaces to fill up your project title, the start and end date of the project, and finally the project description. I usually pull out all these information from the business plan itself. You can check out the various business proposal and plans templates in this website, or you can drop me a hi for help.
In the second part, you can upload various documents such as:
1) The business plan in PDF.
2) Vendor's proposal and quotation in PDF.
3) Financial or manpower projections such as your excel sheets that you used to calculate the numbers.
4) Any productivity projections such as your excel sheets that you used to calculate the numbers.
Key in the Financial Projections
The next section is probably the part that gives the most headache. I often spend the most efforts helping friends with this section. I wonder how smaller companies will be able to fill up this section on their own. It is a pretty daunting task projecting the numbers. Often, the challenge is to balance an aggressive forecast with realistic expectations. Check your financial statements and report to fill up the 'Now' column.
As the form requires you to fill up the 'Net Operating Profit/Loss (before tax)' for the next 3 years, you can't only project your revenues. You also have to project your expenses including manpower, rental, operations and other administrative costs. Use your past financial report as a basis for some of these expense projections.
There is also a need to project your manpower for the next 3 years after implementing the project. Break them down into PMET and non-PMET roles. If there are any increase in workers, they should be factored into an increased manpower cost. You can think of the new required roles for this project and then add in their annual salary package (including CPF) into your existing manpower cost. For existing staff, I typically factor in a 3-5% increase from previous year. All these are keyed into the 'remuneration' boxes.
For the 'Rationale for Projections' portion, I typically explain using the assumptions that I had made, the expected business environment and the key reasons driving the increase/decrease in the numbers.
Key in the Workers' Outcomes
This section provides an assessment of your workers' outcome. Worker outcomes include increase in wage increment, job creation, job re-design, or training for existing staff. You can tick the outcome/s that is/are relevant for your project.
Provide the project costings
This section should be completed based on your vendor's proposal and quotation. Ask your vendor to break down his quotation into the various components as per the screenshot below. Each of these components attracts different level of grant quantum. Hence, it is important that instead of giving you a lump sum quotation, the vendor should break down into the various components accordingly.
What comes next after submission?
You can expect an ESG officer reaching out to you. He or she may want to clarify your business plan or projections. The officer may also discuss with you on certain KPIs to meet e.g. At the end of the 12 months, your revenue can achieve $XXX. If all is smooth, you will get a Letter of Offer (LOF) stating the grant quantum, the KPI to meet and deliverables of this project. The timeline for approval typically takes 8-12 weeks.
Final Thoughts
I am always happy to help SMEs in their grant application. But I often faced challenges when helping them with the projections. First I don't come from their industry, hence some of the projections are simply based on my gut feel. Next, the companies may not have proper financial reports which can aid me in understanding the company's business better. This understanding can help me to give a more realistic projection especially for the expenses portion. Thirdly, I am always fearful that the company over rely on me for the projections. Ultimately, I am just an outsider. The business owners have to answer to ESG and explain the business plan and the numbers submitted.
I hope this short post will be useful for those planning to apply for the EDG grant!
If you are an SME, and if there is any area you may want some help, or an opinion, or just simply a chat, do drop me a message!