A significant amount of funding for small and medium-sized manufacturers (SMMs) in the U.S. comes from grants, loans, and private funders. Every year, about $500 billion in U.S. government spending goes to aid for various sectors, with a significant amount allocated to manufacturing. The amount of capital available to manufacturers has also increased in the post-COVID-19 era, especially with legislation like the CARES Act. It’s easier to secure funding now than ever before.
Below, we’ll share some ways SMMs can take advantage of this funding by applying for U.S. manufacturing grants.
What is a Grant?
In the broadest sense, grants are funds provided to businesses usually with specific qualifications for how they can be utilized to achieve particular outcomes. Grants may fund training programs to focus on upskilling employees or recycling projects to develop greener processes.
However, they do differ from other funding you may apply for and receive as a manufacturer. For example, grants are bound by agreements between funders and recipients, unlike tax credits. Compared to loans, which must be paid back, grants do not have to be repaid (unless you break the aforementioned agreement). And, unlike government contracts with annual or other guaranteed availability, grants tend to be fluid. Grants depend on state and federal budget cycles as well as the current political environment. The specifics of your funding agreement will depend on the kind of grant you apply for and its purpose.
Different Kinds of Grants Available to SMMs
For most SMMs, the primary grants to consider are Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) grants which are both federally funded for research and development (R&D).
There are also Technology-Based Economic Development (TBED) Awards for businesses that can show proof of concept for technology or demonstrate improvements to the workforce.
In total, there are seven main areas in which SMMs can receive grants:
- R&D and commercialization grants support innovative manufacturing process research and commercialization.
- Facilities and capital expansion grants drive investment, especially for growth in number, capacity, or kind of facilities.
- Training grants support upskilling of the manufacturing workforce.
- Recycling grants help divert material from landfills.
- Energy efficiency and renewable energy grants support sustainable solution implementation and projects that promote energy efficiency.
- Exporting grants support international trade efforts.
- Trade Adjustment and Assistance Center (TAAC) grants are designed to help manufacturers mitigate the negative effects of trade by obtaining third-party expertise.
In some cases, states may match federal funding — like reimbursing a portion of an SBIR award. For other grants, such as training, funding is typically provided after the proposed project is completed as a reimbursement.
How to Apply for a Manufacturing Grant in the U.S.
Successfully applying for grants for manufacturing in the U.S. is all about preparedness. The following six steps will prepare you for most U.S. manufacturing grant applications.
Step 1: Register and Submit Financial Information
When applying for state or federal grants, you must first register your business at the federal or state level. Federal grant applications require businesses to have a Data Universal Numbering System (DUNS), which is now being replaced with the Unique Entity Identifier (UEI). Once assigned a DUNS/UEI, businesses register in the System for Award Management (SAM).
Unlike federal grant applications, state grants typically require registration on a portal and proof of business presence in the state to which you are submitting your application.
Once a business is registered in SAM and/or with their state agency, SMMs can identify funding opportunities to which they can apply through grants.gov (for federal grants) or state economic development agencies.
Step 2: Review the RFP or NOFO Thoroughly
For projects that require a Request for Proposal (RFP) — or Notice of Funding Opportunity (NOFO) at the federal level — it is critical to review the proposal multiple times to understand the full extent of its instructions before starting the application. When filling out an RFP or NOFO, SMMs should focus on articulating the strategies and activities they plan to implement to achieve their intended outcomes, ensuring they directly, concisely, and completely address all of the evaluation criteria.
Step 3: Compile a List of Needed Information
Based on the instructions from the RFP or NOFO, you’ll need to identify the specific types of information required to complete the grant proposal.
The information required may include, but is not limited to, the following:
- The number of employees in your business (must be <500 for SBIR)
- Details of the proposed project, including goals and outcomes
- Audited financial statements going back several years
- Social security numbers of trainees for training grant applications
Your business must provide the exact information requested in the RFP or NOFO to increase the chances of a successful grant application. Any incorrect forms may disqualify you.
Step 4: Create an Application Timeline
Once your business fully understands what is required per the RFP or NOFO, it is essential to create a clear timeline that defines which activities must be completed before each due date.
For example, you need to allocate time and resources for information gathering across various stakeholders. Then, you’ll need several rounds of draft reviews and polishing before submitting your application. Ideally, you should be ready to submit a week ahead of the deadline.
Step 5: Execute the Timeline
The to-do list you created when defining a timeline will guide the pace at which your team completes the activities – including when the grant application is uploaded and submitted to the required portal.
Most importantly, you should factor in a sufficient time buffer to make changes and rethink parts of the grant application ahead of the deadline. In most cases, allotting a week before the deadline provides ample time to make any necessary last-minute changes or navigate technical issues.
Step 6: Submit and Wait
After completing the application, the final step is to submit the grant application in the relevant state or federal portal and wait to hear back on a decision. If you’ve followed every other step, this one should be the easiest!
Funding Resources for SMMs
Applying to state or federal government manufacturing grants does not have to be complicated.
Working with partner organizations can streamline the process and increase your chances of receiving an award. Resources available to SMMs nationwide include:
- Procurement Technical Assistance Centers (PTACs)
- Economic Development Centers/Corporations (EDCs)
- Small Business Development Centers (SBDCs)
- The Women’s Business Centers
- Lakeview Consulting
And, in California specifically, CMTC helps to connect SMMs with consultants and partners that can help with the application process.
For assistance with your grant application, contact CMTC today.
About the Author
As President of Lakeview Consulting, Micki Vandeloo helps fund the success of the manufacturing community. With more than 25 years of experience in the manufacturing industry, she has led her clients to success by helping them clarify project goals, plan new services and programs, and secure grant funding to support their missions. Micki’s team of grant professionals at Lakeview Consulting has collectively obtained more than $260 million in grant funding and written over 850 grant proposals.