Small business owners don’t take advantage of the funding available to them when it comes to focusing on innovation. In fact, 60 percent of small business owners don’t even try to pursue small business capital, whether it’s in the form of grants or loans, according to a BMO Wealth Management study.
Why Innovation is Important
In today’s internet-dependent world, businesses tend to thrive when they take advantage of all the technological innovations available to them – whether they are using apps, creating websites, using artificial intelligence, or promoting their business on social media. Without it, they don’t have as high of a profile, losing out on the viral spread technology can give them.
When it comes to tracking finances, inventory, or records, or simply finding a new and better way to do business, proper innovation can save you time and money – and potentially make you more profitable. Innovation doesn’t necessarily need to include technology, however. It ultimately applies to any way you can make your offering new and interesting for your customers, employees, and business.
Why Don’t Small Business Go After Funding for Innovation?
If innovation is so important to whether a business succeeds, why aren’t businesses pursuing funding for it?
Part of the issue is many small business owners don’t know they qualify for such funding or where they should even apply for the funds they’d like. Of those who don’t apply for funding, they gave a variety of reasons in the report.
Not wanting the overhead of a business loan was the reason 36 percent gave for not seeking funding. Another 22 percent didn’t think they would be accepted anyway, so they didn’t try at all. Fear of how complicated the process was going to be kept another 21 percent from applying for funding.
With government grants, the reasons for not applying were different than they were with loans. Many small business owners, or 34 percent, said they didn’t know grant money was an option for them. But out of the 44 percent who were aware there was grant money available, they weren’t sure where they should apply to try landing some of the money.
What Small Businesses Can Do to Innovate
Even without funding to back them up, small business owners can find ways to continue to innovate that won’t necessarily affect their bottom line. The BMO offered ideas in their report that small businesses can follow.
One idea is to sign up for their area Chamber of Commerce and make sure to attend the meetings every month. That can help business owners network and help shape the business climate in their town.
Another idea is to meet with a bank officer to get some idea as to what small business loans they might qualify for. They might be able to use those loans to help grow their businesses by adding innovations.
Small business blogs are another area of education the BMO report identified as a source that can help business owners. They can be a treasure trove of information when it comes to finding programs that offer funding, whether it’s at a local, state, or national level. LendEDU also has a search tool for small business grants.
Business owners may want to consider these measures to continue searching for ways to improve their businesses. Even successful businesses can benefit from innovation – it isn’t just the struggling ones that need it.