Manufacturing Grants: An Overview of Federal and State Opportunities

Factory expansion funded by manufacturing grants

Many manufacturers don’t know there are grants available to help them address their challenges and fund projects that will help them meet market needs, grow, and succeed. At Lakeview Consulting, we specialize in connecting manufacturers directly with funding opportunities and improving their odds of earning grant funding.

In this article we’ll answer our four most frequently asked questions, and provide a complete overview of how manufacturers can use grant funding. We’ll define grants, detail specific grants that for-profit manufacturers are eligible to apply for, cover activities those grants can fund, detail the types of manufacturers who can apply, and explain the criteria manufacturers use to determine whether or not to take advantage of these opportunities.

What is a Grant?

Grants are funds paid to a company (non-profit or for-profit) for a specific project with outcomes (what changes as a result of the project) desirable to the organization providing the funding. Grants do NOT have to be re-paid unless the recipient doesn’t do what they said they were going to when they applied for the grant.

State economic development departments and federal agencies such as the National Science Foundation, Department of Labor and Department of Commerce fund the majority of manufacturing grants. These funding entities desire economic benefits such as job creation, investment, new technology development and workforce skills enhancement.

Free Checklist: Is Your Manufacturing Business Grant-Ready?

What Types of Grants do Manufacturers Qualify For and What do These Grants Cover?

Most of the grant opportunities for manufacturers can typically be narrowed down to six types of grants, which include:

  • Training grants to fund workforce development programs (internally and externally delivered) that manufacturers offer to raise their employees’ skills. 
  • Export program grants that cover the costs manufacturers incur to expand their overseas presence, including trade shows/missions; translation of marketing and instructional materials into other languages; and certifications to sell products in overseas markets.
  • Grants to offset the impact of trade imbalances which cover services manufacturers acquire to be more competitive on the world stage.
  • Rural business development grants that fund investments in energy efficient equipment and renewable energy to spur rural manufacturing economic development, profitability and competitiveness.
  • Market expansion grants to fund equipment, prototyping, and research and development manufacturers need to expand their sales by diversifying their markets.
  • Business attraction grants provided by states to entice manufacturers to pursue large investment and job creation in their state. In many cases, the applicants have to show that they are considering more than one state to maximize their benefits from these types of programs.
  • Grants that fund partnerships between manufacturers and education or workforce development to create or expand apprenticeship programs, implement large-scale workforce development initiatives, and create career pathways for underserved individuals.

Who Qualifies for Manufacturing Grants?

Most manufacturers can apply for any or all of the above funding as long as they meet the following criteria:

  • A strong and sound financial history (most startups can’t apply for funding due to this qualification)
  • Business presence in the state offering the grant
  • Willingness to do the reporting required to obtain the funding (which we can help our clients with)
  • A clean legal history, especially for owners and top-level management
  • An ability to provide match (a percentage of the grant award provided in cash or by an eligible means) for the grant, if required

Why Don’t More Manufacturers Apply for these Grants?

That’s a great question, and there are typically four primary reasons why manufacturers don’t apply for grants they are eligible for:

  1. They don’t know the grants exist. This is by far the most common reason. If no one tells them about the grants and they don’t go out looking (which has often been likened to finding a needle in a haystack), they won’t be aware these grants exist.
  2. They think it’s complicated and too much work. The process of finding the grants seems very daunting to many manufacturing leaders. The opportunities are often hidden on state websites, so a simple Google search won’t typically identify them. Once a manufacturing leader finds a grant, the process of applying is often even more intimidating, with many requirements and supporting documents. So, they don’t pursue the funding.
  3. They have heard horror stories. There are always the stories lingering about “someone who knew someone’s third cousin that lost grant funding” and, as a result, they lost their company. Therefore, those who have heard such a story have vowed to NEVER going to take the chance with a grant. However, the reality is that if someone loses grant funding, it is because that company didn’t do what they said they were going to, lied on their application, or falsified evidence to try to get funding.
  4. They know about grants, but choose not to pursue them. Manufacturers must understand where grant funding is coming from, how government budgets work, and make informed decisions about pursuing grant funding. This was the case with one large manufacturing facility in New York. Although grants were available that would increase capabilities and ROI, leadership held the mistaken belief that if they accepted the money, they’d be taking funding away from “more worthy” non-profit organizations. Grants for manufacturing and funding for social services comes from completely different budgets, with neither affecting the other. In other cases, manufacturing leaders simply have a strong aversion to accepting such funding from government sources.

Education and access to resources to find and apply for grant funding can help manufacturers achieve a comfort level for, and desire to, pursue grants. Those who make that mindset switch tend to be progressive and growing companies who are open-minded, and are led by a team who wish to engage in the process. The result is greater profitability and success. It’s no longer good enough to simply survive in today’s manufacturing landscape. The manufacturers who will lead the United States into the future will be those who have a deep bench of skilled talent, who have successfully navigated supply chain trends and onshoring, and who have adopted the technology that will allow manufacturing to thrive.

Free Download: The Complete Manufacturer's Gudie to Grant Funding

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